The first phase of Oman's North-South Interconnection project, called Rabt, is now operational, linking the sultanate's two standalone electricity grids.

The majority state-owned utility, Oman Electricity Transmission Company (OETC), completed work on five major grid stations linked by overhead transmission lines over a distance of 670 kilometres.

The network is now fully in place and is operating at voltages of up to 400 kilovolts (kV).

The project required an investment of about OR372m ($966m). 

It enables Oman's Main Interconnected System, serving the northern half of the Oman grid, to connect with Nihada in Al-Dhahirah Governorate and Duqm Special Economic Zone (SEZ) in Al-Wusta Governorate.

Al-Wusta is understood to offer an optimal location for solar and wind projects, which the country aims to develop as part of its green energy ambitions. Oman does not intend to procure additional natural gas-fired power generation capacity.

Also part of Rabt's first phase, the isolated networks of Petroleum Development Oman and the Rural Areas Electricity Company (Tanweer) in Duqm SEZ, have been interconnected.

A second phase is being planned for Rabt. To be launched later this year, the next phase will comprise 400kV transmission lines from Duqm to Dhofar, spanning more than 500 kilometres. 

2021 bonds

OETC, part of the Nama Group, floated $600m of bonds with a tenor of 10 years and an interest rate of 5.8 per cent in February 2021. The issuance is OETC’s first in four years.

Proceeds from the issuance were designed to refinance existing loans, including the shareholders' loan extended to OETC by Nama and State Grid Corporation of China. They will also fund OETC’s capital expenditure programme.

OETC manages the grid in northern Oman and Dhofar at voltages of 400kV, 220kV and 132kV. It was said at the time that one of the major OETC capital expenditure programmes was the execution of the first phase of the 400kV North-South Interconnection project.

The bond proceeds were also used for a 400kV project to connect a 1,000MW photovoltaic solar plant in the Wilayat of Manah, in the governorate of Al-Dakhiliyah, by 2024-25.

In December 2020, Nama awarded State Grid Corporation of China the contract for the privatisation of OETC. Nama divested 49 per cent of its shares in OETC to the Chinese firm, which raised $1bn in capital.

Oman has been planning to sell several state-owned electricity companies as part of the sultanate’s objective to privatise its electricity sector and reduce subsidies.