Duqm refinery on track for financial close

Oman Oil Company (OOC) on Tuesday announced it is in the process of completing shareholder agreements with Kuwait Petroleum International (KPI) for the Duqm Refinery and Petrochemicals Project.

Set to be built in the Special Economic Zone at Duqm, the company expects a final investment agreement on the project by mid-year.

KPI, the international investment arm of Kuwait’s NOC, came on board in a 50/50 joint venture announced in November 2016. The Kuwaiti company stepped in after Abu Dhabi’s International Petroleum Investment Company pulled out of its 2012 joint venture with OOC to develop the Duqm Refinery and Petrochemicals Project.

Isam al Zadjali, CEO of OOC, told reporters at a Ministry of Oil and Gas event on Tuesday, “We are hoping to start construction activities before year-end or early next year.”

Zadjali also said that work had progressed significantly with the previous partner, and that no delays were expected due to the change in structure.

The project is likely to be 60% equity- and 40% project-financed.

Duqm Refinery is set to process 230,000 barrels of crude per day, and will primarily produce jet fuel, diesel, naphtha and LPG.

In other news, KPMG this week announced the results of its Oman CEO Outlook Survey 2017. Based on 24 interviews with Oman CEOs, the study found that 81% share a positive outlook about the growth of their businesses over the next three years.

Ninety percent of CEOs interviewed said their businesses had grown over the previous three years. Key areas of focus in the short term included innovation, though 16% indicated this would need to come from outside sources through alliances or acquisitions due to a lack of intellectual capital in Oman. A majority of CEOs – 62 %– predicted their businesses would undergo significant change in the coming three years.