OMAN - The Refining Sector.

Oman has one refinery in the port of Mina al-Fahal, near Muscat, with a capacity of 85,000 b/d. Operated by Oman Refinery Co. (ORC), it is owned 99% by the Ministry of Oil and Gas (MOG) and 1% by the Central Bank. The plant meets local demand for gasoline, jet fuel, gasoil/diesel, kerosene, LPG and bunker fuel. It has been upgraded and debottlenecked to produce unleaded gasoline and cleaner diesel.

Unleaded gasoline was introduced throughout Oman on Oct. 1, 2001, with Shell Oman Marketing providing its Millenium additive to all local gasoline marketers - ORC's retail affiliate al-Maha, Shell's retailer and BP Oman. ORC's residual fuel oil is to be pumped by pipeline to Sohar where it will be turned into high quality gasoline by the complex refinery which will be on stream later in 2006 (see below).

The refinery has an 18,000 b/d diesel hydro-desulphurisation (DHDS) unit installed in December 2003 by SK Engineering & Construction of South Korea, which has also built amine treating and sulphur recovery units and associated pumps and equipment. The FEED work for them was done by Halliburton's KBR. These units process 50 parts per million sulphur-carrying diesel, producing pure sulphur used in a number of industries including petrochemicals.

In the second phase of the upgrade, ORC will have a 10,000 b/d isomerisation unit licenced by UOP to produce unleaded gasoline. The refinery will soon have condensate, export and storage facilities and associated utilities. The feedstock for the unit will come from a mixture of light naphtha being produced at the refinery and condensate supplied by Oman LNG. The FEED work for Phase-2 was done in 2003 by Granherne & Co. of the US.

The refinery was built at a cost of $107m by Mitsui Engineering and Shipbuilding Co., with Shell Int'l as project manager. It came on stream in 1982 with a capacity of 50,000 b/d. But initially it processed just 18,000 b/d of crude oil. It reached full capacity in 1984. In 1985, ORC decided to upgrade and expand the plant. A $24.4m contract was awarded to Mitsui to raise the capacity to 80,000 b/d and install a sulphur extraction unit. This was completed by end-1987. Capacity has since been raised to 85,000 b/d. Mitsui won a contract in late 1992, worth OR13.8m, to install a continuous catalytic regeneration (CCR) unit supplied by UOP, for ORC to produce unleaded gasoline for export to other GCC states. It was also to extend the period between maintenance shutdowns from once every two years to once every three or four years. The project was completed at end-1993.

A 24-inch, 260-km mixed feedstock pipeline from Mina al-Fahal to the Sohar refinery is being built with a capacity of 116,000 b/d to carry heavy crude oil and residual fuel oil. The FEED work for the $200m project was done by ILF & Partners of Germany. The PMC is Mott MacDonald. This will include a pressure reduction terminal, pumping stations, SCADA controls, and telecommunications and lead detection systems. OGC will be operating the pipeline. The initial 40 km of the pipeline will traverse the main arteries of Muscat municipality. Mott MacDonald's role involves monitoring the EPC contractor's activities including detail design, procurement, construction, pre-commissioning, commissioning and guarantee run. In conjunction with the main pipeline development Mott MacDonald has done engineering work for a gas spurline of about 40 km from Murayrat pressure letdown station to the Oman refinery. Mott MacDonald is also to ensure the project is completed within OGC programme.

The Sohar refinery project, to cost about $1.2 bn, has been delayed for years due to financing problems and hesitation about its ownership and location (see Vol. 62, DT No. 6). The plant is to be owned by an ORC unit, Sohar Refinery Co. (SRC). The EPC contractor for the 116,000 b/d refinery is JGC Corp. which did the FEED work. To be on stream later in 2006, this will process into high-octane unleaded gasoline the residual fuel surplus from Mina al-Fahal, as well as heavy crude oils into low-sulphur gasoil/diesel, jet fuel and LPG.

UOP has done the basic engineering design for a residue fluid catalytic cracker. The refinery will have a topping plant, added to the list of units in late 2001 so it can process crudes into its own long-residue streams, as well as an alkylation unit, gasoline and LPG treating units, a gasoil hydrotreater and a propylene recovery unit. The PMC is ABB Lummus Global of the US.

Under a $45m contract signed in September 2003, LG-Caltex and LG Engineering & Construction, both affiliates of LG Int'l and LG Group, will operate and maintain the Sohar refinery for a period of seven years. The deal includes the training of Omani nationals. BP has the products' offtake contract signed with ORC. Together with Trafigura of the Netherlands, the UK major will take 80,000 b/d of the output to a blending plant being built in Dubai's Jebel Ali Free Zone. (BP used to provide ORC with technical assistance for years).