Oman Qalhat LNG Terminal

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Oman Qalhat LNG Terminal is an LNG terminal in Ash Sharqiyah, Oman.

Location

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Project Details

• Parent: Government of Oman (51%), Shell (30%), Total (5.54%), Korea LNG (5%), Partex Oil & Gas (2%), Mitsubishi (2.77%), Mitsui (2.77%), Itochu Corporation (0.92%)
• Location: Qalhat, Ash Sharqiyah, Oman
• Coordinates: 22.6586, 59.40748 (exact)
• Capacity: 10.6 mtpa, 1.52 bcfd
• Additional Proposed Capacity:
• Status: Operating
• Type: Export
• Start Year: 2000

Note: mtpa = million tonnes per year; bcfd = billion cubic feet per day

Background

Oman Qalhat LNG Terminal is an LNG terminal in Ash Sharqiyah, Oman.

The company was established by the Royal decree of Sultan Qaboos of Oman in 1994. Construction began was in November 1996. It made its first shipment in September 2000.

The LNG plant is supplied from the gas gathering plant at Saih Rowl in the central Oman gas field complex through a 360 kilometres (224 mi) pipeline with a capacity of 12 billion cubic meters per annum of gas. It is operated by Petroleum Development Oman. The gas originates from the Barik, Saih Nihayda and Saih Rawl gas fields.

The LNG plant has two consists two liquefaction trains. The total construction costs were US$2 billion.

In 2005 operating the Oman Qalhat LNG was the largest consumer of Oman's natural gas. It used 40% of total gas production. By 2011, 64% more gas went to the oil fields for enhanced oil recovery.

In October 2013, Oman LNG and Qalhat LNG announced they would merge to become a single entity. This would increase the combined capacity of three liquefaction trains and 10.3 million tons per year.

Oman Qalhat LNG revenue was $2,612 million in 2015. Its production that year was 7.9 million tons. In 2016 there was a fall in prices. Its revenue was $1,925 million in 2016. Its production was 8.5 million tons.

According to the International Gas Union’s World LNG 2017 report, UAE was the ninth largest LNG exporter by share after Qatar, Australia, Malaysia, Nigeria, Indonesia, Algeria, Russia, and Trinidad between 2015 and 2016.

Iran/Oman Pipeline to LNG

In 2013 Oman and Iran signed an agreement to supply gas to Oman through the pipeline in a project valued at $60 billion over 25 years. Iran’s oil minister said in 2017 the pipeline would need a $1.2 billion investment.

The pipeline could connect Iran’s gas reserves with Omani consumers and with Oman's LNG infastructure. Oman's LNG plant could re-export the gas.

The two countries renewed efforts to implement the pipeline after international sanctions against on Iran were lifted in January 2016. The U.S. has pressured Oman to find alternative gas suppliers.

In February 2017 Oman and Iran agreed to change the route of the undersea pipeline. Reuters reported this move was to avoid waters controlled by the United Arab Emirates.

Qatar and Oman LNG

In August 2017 a Qatar shipping company, Milaha Maritime and Logistics, moved its hub from UAE to Oman. Blockading countries, led by Saudi Arabia, had denied Qatar access to their ports. Normally Qatar LNG stopped at the UAE’s Jebel Ali FLNG Terminal, Dubai, or in Abu Dhabi. The LNG then smaller boats in route to Doha, Qatar. Jebel Ali was difficult for Qatar to access during the blockade. Oman announce its desire to take Qatar's LNG through its port and it has remained neutral in the Saudi-led blockade. This move to Oman threatens Dubai’s status as a regional financial hub.

Industry analysts think believe that both Kuwait's Mina Al-Ahmadi LNG Terminal and Oman will financially benefit from LNG trade transactions that used to take place in the UAE. Qatar Petroleum chief told Al Jazeera on July 2017 that at 7 million tons a year his country is the world's biggest LNG exporter.