New NGL Extractor Project in Oman: What It Means for Investors and Businesses
BUSINESS REPORTER
MUSCAT, NOV 5
A pivotal gas sales agreement signed this week marks a significant step toward establishing a new Natural Gas Liquids (NGL) Extraction Project at Saih Al Nihayda in central Oman. This development is poised to bolster the long-envisioned petrochemicals complex within the Special Economic Zone at Duqm (SEZAD).
The agreement, one among five contracts and one memorandum of understanding (MoU) finalized by OQ, the global energy investment group, and the Integrated Gas Company (IGC)—Oman’s sole natural gas aggregator and supplier—aims to enhance the resilience and integration of Oman’s gas value chain. This covers the spectrum from upstream exploration to downstream industrial applications, securing a reliable gas supply to fuel industrial expansion across the country.
Under the terms of the agreement, the parties have committed to supplying 48 million cubic meters of natural gas daily over a 20-year period to the Saih Al Nihayda NGL Extraction Project. The initial phase will include facilities for gas separation, storage, and export within SEZAD.
The Term Sheet also outlines a second phase involving gas allocation for the planned Duqm Petrochemicals Complex. This complex is expected to have an ethane production capacity of one million tonnes annually, fostering an integrated industrial ecosystem aimed at boosting in-country value.
This agreement was signed by Ashraf bin Hamed al Mamari, Group Chief Executive Officer of OQ, and Abdul Rahman bin Humaid al Yahyaei, Chief Executive Officer of IGC.
Additional agreements include one allowing OQ Exploration and Production (OQEP) to sell its natural gas share from Block 65 to IGC, enhancing flexibility and sustainability within Oman’s domestic gas supply network and ensuring steady gas delivery to industrial consumers.
In the LNG sector, an agreement enables Marsa LNG to receive and transport up to 150 million standard cubic feet per day of natural gas from its share in the Mabrouk field (Block 10), where it holds a 33.19% stake.
Downstream, Oman India Fertiliser Company (OMIFCO) and IGC renewed a natural gas supply contract for ten years, securing the commercial and operational framework for the sale and purchase of 4.3 million cubic meters of gas daily—equivalent to 161,000 MMBtu/day. This contract ensures uninterrupted feedstock supply for sustained ammonia and urea production.
To support infrastructure sustainability in Duqm, IGC also signed an agreement with Marafiq to supply natural gas to the Duqm power and water desalination plant. This agreement guarantees consistent energy and water services essential for the ongoing growth of SEZAD.
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This landmark set of gas supply agreements positions Oman as a pivotal energy hub with a strengthened and integrated gas value chain, facilitating the development of the Saih Al Nihayda NGL Extraction Project and the Duqm Petrochemicals Complex. For businesses, this creates new industrial growth opportunities and enhanced energy security, while smart investors should consider the long-term potential in Oman’s expanding downstream petrochemical and fertilizer sectors, driven by stable feedstock supply and strategic location within SEZAD.
