Oman's Duqm refinery could process heavier, more sour crudes by year end


By Maha El Dahan

DUBAI, Feb 28 (Reuters) - Oman's newly inaugurated Duqm refinery, OQ8, may start processing more crude grades towards the end of the year with studies currently underway, CEO David Bird told Reuters.

"That was thought of in the process of design, to make sure we could process some of the heavier, more sour crudes," Bird said.

The Duqm refinery is a $9 billion joint venture between Oman's OQ Group and Kuwait Petroleum International and located in Oman's Duqm Industrial Zone.

It is now running at full capacity of 230,000 barrels per day (bpd) and processing 65% Kuwaiti crude and 35% Omani.

"Towards the latter half of 2024 and beyond we will be looking at a full merchant refinery model of processing advantage crudes," Bird said.

Economic evaluations are underway that will prioritise from a basket of crudes and once the most advantage is identified, technical evaluations and a test run will be done before taking the matter to shareholders.

"Both shareholders are fully supportive," Bird said.

OQ8 has so far exported 100 shipments, around 4.1 million tons of products globally, since it started operating in May.

Bird said he was "pleasantly surprised" by some of the destinations that have seen the most demand with a lot of volumes going into the east coast of Africa and the Indian subcontinent.

"Because of the proximity to those markets we are very competitively positioned to serve them."

A feasibility study is currently underway for a petrochemicals complex in the Duqm Economic zone with the potential participation of Saudi Basic Industries Corp (SABIC) alongside the two shareholders.

"The feasibility study was put on hold during COVID," Bird said.

"The shareholders launched another feasibility study and the Saudis have expressed interest to come into that expansion."

Bird said the results of the study, that has been running throughout 2023, were "imminent".

(Reporting by Maha El Dahan; editing by David Evans)

((, @mahaeldahan;))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


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