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Duqm Refinery all set to become key player in global energy market

5 Feb 2024 By OUR CORRESPONDENT

Muscat – The Duqm Refinery Project, a joint venture between Oman’s global integrated energy group OQ and Kuwait Petroleum International, with an investment cost of approximately $9bn, has positioned itself as a key player in the global energy market.

Duqm Refinery and Petrochemical Industries Company (OQ8) is setting benchmarks with its provision of high-quality energy solutions that fuel the growth and development of both industrial sectors and daily energy consumption. As one of the most advanced and expansive refineries in the Middle East and North Africa region, OQ8 relies on imported crude oil in its operations, setting it on a strategic path to be recognised as a world-class refining entity.

OQ8 has been recognised as the largest investment project between Oman and Kuwait and is one of the standout industrial ventures within the Special Economic Zone at Duqm (SEZAD) and a major stimulus for refinery-based projects.

OQ8’s commitment to supplying superior petroleum products worldwide will significantly boost Oman’s refining output, elevating the sultanate’s refining capacity to over 500,000 barrels per day.

Mulham Basheer al Jarf, Deputy President for Investment at Oman Investment Authority and Chairman of OQ Group, said that OQ8 is a testament to Oman’s commitment to fostering strategic partnerships, particularly with fellow GCC nations. He further said that OQ8’s objective is to optimize Oman’s natural resources and significantly enhance the value of crude oil.

Constructed to meet the highest international standards and equipped with state-of-the-art technology, the OQ8 project is a cornerstone of OQ Group’s strategy aimed at enriching the Omani economy through diversified investments.

Ashraf bin Hamad al Mamari, Acting CEO of OQ Group, said, “OQ8 marks a pinnacle of achievement for the Omani-Kuwaiti alliance. This collaboration not only merges our economic interests but also celebrates the profound connection and shared legacy that Oman and Kuwait hold.”

He highlighted that the project’s success unlocks further opportunities for future cooperation among GCC countries in developmental and economic initiatives, bolstering the stability of global energy supplies.

Shafi Taleb al Ajmi, CEO of Kuwait Petroleum International (Q8) and Vice Chairman of OQ8, said, “The establishment of OQ8 in Oman serves as a monumental milestone in the evolving economic relations between Oman and Kuwait and reflects the robust support and attention that both governments have afforded to the refinery.”

Ajmi affirmed that OQ8 cements both countries’ roles in the international energy landscape by pooling resources and expertise to foster technological progress and enable infrastructure enhancement, thereby stimulating innovation in renewable energy and other sectors.

He noted that OQ8 significantly boosts Oman’s and Kuwait’s efficacy in the energy sector, notably enhancing the trade flow between East and West. It opens new markets in Asia and Africa, where there is a consistently rising demand for energy.

Ajmi emphasised OQ8’s strategic importance given its proximity to the Arabian Sea and the Indian Ocean. This prime location positions it as a crucial gateway to international markets and maritime routes.

Integration with OQ projects

Duqm Refinery Project’s synergy with nearby strategic projects establishes it as a pivotal industrial center, facilitating the growth of petrochemical and downstream industries within the Duqm region.

OQ8 is seamlessly integrated with a number of OQ Group investment projects, including OQ Gas Networks (OQGN), Oman Tank Terminal Company (OTTCO), Marafiq, and OQ Trading (OQT).

The Ras Markaz Crude Oil Terminal, expertly managed by OTTCO, is a shining example of this integration, as OTTCO provides crude storage tanks from which crude is transported to the refinery via pipelines extending over 80 km.

Marafiq, on the other hand, delivers vital services such as electricity, water, and sewage treatment to support OQ8 and several other projects, enabling the operations of various industries, including petrochemicals, manufacturing, and heavy industries, contributing to the development of manufacturing infrastructure.

Additionally, OQGN’s extensive 221km long gas pipeline, stretching from Fahud to SEZAD, is strategically designed to cater to both the present and future gas supply requirements of the region.

Hilal al Kharusi, CEO of Commercial and Downstream at OQ Group and Chairman of OQ8, underscored the refinery’s strategic significance in achieving the goals outlined in Oman Vision 2040, signifying a critical juncture for the advancement and enhancement of Oman’s energy sector.

OQ8, ranking among the largest and most advanced refineries in the Middle East and North Africa, processes 230,000 barrels of crude oil daily to produce essential products such as diesel, jet fuel, naphtha, and liquefied petroleum gas.

Kharusi emphasised the refinery’s strategic position at the nexus of the Indian Ocean and the Arabian Sea, highlighting its potential to spearhead joint economic ventures among GCC countries, thereby fortifying economic connections.

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