Oman to merge oil, petrochemical firms under OQ brand

Market: Crude oil, Oil products, Petrochemicals
18/12/19

Oman's government has announced further details of its planned integration of state-owned oil company OOC, refiner Orpic and seven other domestic energy firms.

A new entity, OQ, will be set up to integrate the operations of the companies. This is the latest step forward in the Nakhla integration programme that was launched late last year, shortly after OOC and Orpic announced plans to merge their downstream and upstream operations.

OQ will comprise OOC, Orpic, OOC's upstream arm OOCEP, Oman Gas (OGC), Duqm Refinery and Petrochemicals Industries (DRPIC), Salalah Methanol (SMC), Oman Trading International (OTI), oxo intermediates and derivatives producer Oxea, and Salalah Liquified Petroleum Gas.

The government said earlier this year that it aims to implement the organisational structure by the end of 2020 and plans to invest over $28bn in the next 10 years.

The integration will enable Oman to streamline its downstream operations before new refinery and petrochemical projects start up in the coming years.

Orpic is in the process of commissioning new polymer plants that are expected to be operational next year. Orpic will produce 300,000 t/yr of polypropylene (PP) and 880,000 t/yr polyethylene (PE), according to Argus data.

The new 260,000 b/d DRPIC refinery is on track to start commissioning in late 2022. DRPIC's planned 1.6mn t/yr mixed-feed steam cracker is scheduled to be operational by 2026, with petrochemical derivative units expected to come on stream around the same period.

Consolidation has been a major theme for Mideast Gulf petrochemical producers in 2019. Saudi Arabia-based Sipchem, a producer of methanol, polymers, and acetic acid, earlier this year merged its operations with fellow Saudi-based firm Sahara Petrochemicals, a supplier of PP.

State-owned Saudi Aramco in March announced plans to acquire a majority stake in state-controlled petrochemicals producer Sabic.

By Muhamad Fadhil

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