New Energy Giant Takes Shape in Oman

Under the name OQ a new integrated energy group is taking shape in Oman. As part of a master plan to revamp the sultanate’s production infrastructure, the government has decided to roll state-owned Oman Oil Company (OOC), Oman Refineries and Petroleum Industries Company (ORPIC) and six other domestic energy firms into one unit that would also include German oxo intermediates and derivatives producer Oxea.

The Oberhausen-based German company is owned by the now merged OOC and ORPIC.

Oman-based companies that will be part of the new energy giant include OOC's upstream arm OOCEP, Oman Gas (OGC), Duqm Refinery and Petrochemicals Industries (DRPIC), Salalah Methanol (SMC), Oman Trading International (OTI) and Salalah Liquified Petroleum Gas.

The asset merger is part of Oman’s Nakhla national integration program launched in late 2018, which in turn led to the upstream/downstream merger of OOC and ORPIC. The government said earlier it planned to have the organizational infrastructure in place by the end of 2020 and over the next 10 years invest $28 billion downstream of new refinery and petrochemical projects.

One of the seeds of the oil-rich sultanate’s plan to carve out a larger slice of the Gulf region’s petrochemical pie, is a $5 billion project kicked off by ORPIC in 2013, which was initially penciled in for start-up in 2018 but is just now being completed. 

This project includes a $3.6 billion integrated petrochemical complex that would have a mixed-feed steam cracker with capacity of 1.6 million t/y, along with production facilities for 880,000 t/y of PE (both HDPE and LLDPE) and 300,000 t/y of PP. All of the units are expected to go on stream this year.

According to consultants Argus, the new 260,000 b/d refinery to be operated by DRPIC, as part of the same complex, is slated for commissioning in late 2022, followed by the cracker in 2026.

Independent of the asset merger, Oxea’s chief operating officer, Oliver Borgmeier, said the German company’s current business processes will remain unchanged. What’s more, he said, “with a focus on oxo derivatives and specialty chemicals, we invest significantly to serve the global markets better.”

Thanks to the efficiency offered by digitalization and automation, Borgmeier said Oxea will be able to improve its flexibility to meet changing demand. By 2021, the company expects to bring on stream new production capacity for TCD alcohol that is expected to cover anticipated global demand for years to come.

Also in 2021, Oxea said it will start up its sixth world-scale plant for carboxylic acids at Oberhausen, increasing its total capacity by more than 30%.