meed-logo

line1 line2 line3
SIGN IN / REGISTER

Oman diversifies hydrocarbons value chain

17 December 2023

Oman’s efforts to diversify its hydrocarbons value chain and derive more economic benefits from it are gaining traction.

State energy conglomerate OQ is pushing ahead with oil and gas projects aligned with its Oman Vision 2040 goals of achieving energy security, increasing revenues for the sultanate, and expanding its business portfolio into new energy frontiers such as hydrogen.

Oman aims to become a leading green hydrogen hub, producing 1 million tonnes a year (t/y) of green hydrogen by 2030 and 8.5 million t/y by 2050. Achieving this will require a total capital expenditure budget of $140bn, with a further investment of $230bn to unlock the hydrogen export economy.

While Muscat takes steps to establish a thriving green hydrogen ecosystem, OQ and its partners are also moving forward with plans to realise the sultanate’s blue hydrogen potential.

Hydrogen foray

OQ Gas Networks (OQGN), a subsidiary of OQ, is understood to be making progress with a project to build a cross-country hydrogen transport pipeline network, following its initial public offering (IPO) and listing on the Muscat Stock Exchange in October.

“While most discussion surrounds green hydrogen, there is also the potential for blue hydrogen production … which would provide additional long-term support to gas flows through the natural gas transportation network (NGTN) and is increasingly likely given the probable surplus upstream gas capacity,” OQGN said in its IPO prospectus.

“Blending hydrogen into gas streams could be an interim strategy to kickstart hydrogen production before demand is sufficient to justify investments in dedicated hydrogen pipelines,” the company added.

To that end, OQGN commissioned a feasibility study in 2022 to assess how much hydrogen could be introduced into the NGTN “before adverse effects would be noticeable and too expensive to mitigate”.

The company is understood to have advanced the study in 2023, and is expected to firm up the project’s engineering, procurement and construction tendering schedule in 2024.

OQGN also signed a memorandum of understanding with Belgium-based energy infrastructure company Fluxys International in October to jointly explore cooperation in developing hydrogen and carbon-capture projects in Oman.

Separately, the UK/Dutch Shell is studying the prospect of establishing a blue hydrogen and blue ammonia production facility in Oman, according to a local media report.

The company is considering Duqm, located in the southeast of the sultanate on its Arabian Sea coastline, as the location for the proposed project.

Shell is understood to be collaborating with the majority state-owned Petroleum Development Oman (PDO) for the planned blue hydrogen and blue ammonia production complex.

Through the project, Shell intends to tap into the recovery and storage of carbon dioxide discharged from its operations, while PDO plans to produce blue hydrogen.

Oman’s Energy & Minerals Ministry is supporting Shell in its study of the technical and commercial feasibility of the project, according to the report.

Raising upstream capacity

Maintaining oil and gas production capacity in the long term continues to be a priority for Oman.

In November, OQ awarded Canada-based Enerflex the main contract for a project to expand the production potential of the Bisat oil field in the sultanate. Enerflex will undertake the project, estimated to be valued at $200m, on a design, build, own, operate and maintain (DBOOM) basis.

The project represents the latest expansion phase of the Bisat oil field, situated in central Oman’s Block 60 hydrocarbons concession. Discovered in 2017, the Bisat oil field consists of about 165 oil wells and three crude oil processing plants.

The first crude oil processing plant at the field started operations in August 2019 and the second began running in September 2021. The third plant was commissioned on a trial basis in November 2022.

OQ raised production at the Bisat oil field from 5,000 barrels a day (b/d) in 2019 to 55,000 b/d by the third quarter of 2022. This is understood to be the fastest annual growth in oil field production in the Middle East. 

In January 2023, OQ announced that the Bisat oil field development had attained a production milestone of 60,000 b/d.

Gas production project

The majority state-owned PDO is preparing to issue the main tender for a project to build an integrated facility to produce gas from the Budour and Tayseer fields in 2024.

The project aims to expand the capacity of the existing gas production and processing facility at Tayseer. It represents the second development phase of the gas field. PDO also seeks to appraise, produce and process sweet gas from the Budour field, about 50 kilometres west of the Tayseer field.

PDO intends to appoint a contractor to deliver the combined Budour-Tayseer sour gas processing facility project on a DBOOM basis. It is projected to have a capacity of 78.39 million cubic feet a day (cf/d) and 1,167 cubic metres a day (cm/d) of unstabilised condensate.

The facility will handle gas exports of about 70 million cf/d and stabilised condensate exports of 950 cm/d, with a water handling capacity of 340 cm/d.

MEED's January 2024 special report on Oman also includes:

> ECONOMY: Muscat performs tricky budget balancing act 
> BANKING: Omani banks look to projects for growth
> POWER & WATER: Oman expands grid connectivity

https://image.digitalinsightresearch.in/uploads/NewsArticle/11360957/main2307.jpg
Indrajit Sen

Register for MEED's guest program now to access this article.

Click here to register
Exclusive from Meed
Related Articles
  • Lowest bidder emerges for Kuwait Airport Terminal 2 operations

    19 October 2026

     

    Ireland’s DAA International has emerged as the lowest bidder for the contract to operate, manage and maintain the new passenger Terminal 2 (T2) at Kuwait International airport, submitting an offer of KD419m ($1.35bn).

    Official price-opening records released by Kuwait’s Central Agency for Public Tenders on behalf of the Directorate General of Civil Aviation show three international airport operators submitted commercial bids for the tender.

    DAA International’s proposal undercut its nearest rival by about 45%. Turkiye’s TAV Airports Holding submitted the second-lowest offer at KD764.15m ($2.46bn), while South Korea’s Incheon International Airport Corporation bid KD959.48m ($3.1bn).

    All three proposals were marked as approved in the tender committee’s price disclosure.

    The contract entails the operation, management and improvement of training, maintenance and development services across Terminal 2 and its associated aircraft parking aprons.

    The remit also includes corporate management of centralised operation and maintenance across the broader Kuwait International airport model, centralising operational procedures, systems integration and service delivery across the aviation hub.

    Technical documents indicate the winning operator will oversee facility management, terminal operational readiness, passenger processing systems, apron operations and staff development programmes before and after the complex’s commercial launch.

    MEED reported in June 2023 that six airport operators had initially been invited to bid for the Terminal 2 operating concession.

    Terminal 2 is the centrepiece of Kuwait International airport’s multibillion-dollar expansion, aimed at boosting total handling capacity to 25 million passengers a year.

    Turkish contractor Limak Insaat is executing the main terminal building under an estimated $4.34bn contract awarded in 2016.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/20747061/main.png
    Yasir Iqbal
  • Dubai tenders Al-Maktoum-Dubai South drainage scheme

    19 October 2026

    Dubai Municipality has invited contractors to submit bids by 5 November for the construction of a stormwater drainage system connecting Al-Maktoum Airport and Dubai South

    The project, designated TF-06-C2, involves approximately 20 kilometres of pipelines with diameters ranging from 400mm to 3,000mm. The works will use deep trenchless construction and conventional open-cut methods. 

    The scheme is one of four projects, for which a project management consultancy (PMC) tender was issued earlier this month.

    The tender for TF-06-S1 Supervision of Stormwater Drainage System Projects – Package 4 was issued on 6 October.

    The consultancy covers the following projects:

    • TF-06-C1: Construction of a stormwater pond connecting Al-Maktoum Airport and Dubai South
    • TF-06-C2: Construction of a stormwater drainage system connecting Al-Maktoum Airport and Dubai South
    • TF-07-C1: Construction of a stormwater drainage system on Sheikh Zayed Bin Hamdan Road connecting developers
    • TF-24-C1: Connecting developers’ areas to the stormwater networks in Dubailand 

    The projects are part of Dubai Municipality’s wider Tasreef programme, intended to increase Dubai’s rainwater drainage capacity by 700% by 2033 and provide capacity for the emirate’s needs for the next 100 years.

    Investment in the UAE water sector has been dominated by stormwater drainage and network resilience schemes this year, as Dubai Municipality advances procurement under its AED30bn ($8.1bn) Tasreef programme.

    TF-07-C1

    As previously reported, contractors are preparing to submit bids on 22 October for the main construction contract for TF-07-C1.

    The project covers more than 100 million square metres between Sheikh Mohammed Bin Zayed Road and Emirates Road, and from Expo Road to Dubailand.

    It will provide stormwater infrastructure and service connections for more than 20 private developers and Al-Yalayis 5, as well as supporting major roads in the Jebel Ali area. The construction scope includes a major gravity drainage system with pipeline diameters of up to 3,000mm.

    TF-24-C1

    Bids for TF-24-C1 were submitted on 1 October, with Nael Construction & Contracting, Al-Nasr Contracting Company and Al-Kharafi & Sons understood to be among the bidders. 

    The project will connect developers’ areas in Dubailand to the stormwater network. It includes 18km of stormwater drainage pipelines with diameters of up to 1,800mm and 3.5km of gravity sewer pipelines with diameters of up to 1,000mm.

    As MEED understands, the main contract tender for TF-06-C1 has yet to be released.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/20746611/main.jpg
    Mark Dowdall
  • Contractor wins $44m Morocco rail stations deal

    19 October 2026

    Morocco’s national railway operator, Office National des Chemins de Fer (ONCF), has awarded a MD437.6m ($44.5m) contract to local firm Jet Contractors to build five railway stations along the Benguerir-Marrakech corridor.

    The project forms part of the wider Kenitra-Marrakech high-speed rail development programme.

    Jet Contractors will build one high-speed rail station and four regional express rail stations.

    These include two stations in Benguerir, and one each at Sidi Bou Othmane, Sidi Ghanem and Marrakech Stadium.

    The scope of work includes construction and fit-out of the stations and associated infrastructure, including concrete structures, platforms, ancillary facilities, passageways, circulation areas and connection zones within the stations.

    It also covers architectural finishing works; testing and commissioning of electrical networks; and all mechanical, electrical and plumbing services.

    The contractor will also provide all safety, security and protection systems, including alarms, fire detection and firefighting systems, and surveillance systems.

    Morocco awarded multiple civil works contracts in 2024 to international and local firms to build its Kenitra-Marrakech high-speed railway line.

    The rail project is part of a $37bn strategy to connect more of Morocco’s cities, ports and airports by rail. It will stretch 375 kilometres from Kenitra on the northwest coast to Marrakech in the south.

    The project is divided into seven lots, each measuring 36km to 64km. The rail link will pass through cities including Rabat, Sale and Casablanca.

    The link will extend the Al-Boraq high-speed rail line between Tangier, Rabat and Casablanca. The line began operating in 2018 and was Africa’s first high-speed railway system.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/20745963/main.jpg
    Yasir Iqbal
  • Firms submit Dubai multibillion-dollar road scheme interest

    19 October 2026

     

    Register for MEED’s 14-day trial access 

    Contractors submitted expressions of interest on 10 October for a design-and-build contract for a multibillion-dollar new road that will run parallel to Sheikh Zayed Road.

    Dubai’s Roads & Transport Authority (RTA) held an online meeting after the submissions to prepare for the prequalification phase of tendering, expected to start in a few weeks.

    The scope covers about 30 kilometres (km) of works.

    These include about 15km of viaduct along First Al-Khail Street and more than 14.5km of bridge ramps, along with other associated infrastructure works.

    The RTA floated the expression of interest notice to contractors in early September.

    The project is another significant initiative aimed at alleviating pressure on the existing Sheikh Zayed Road section from Hadiqa Street to Hessa Street.

    Dubai has previously explored bold concepts to expand capacity on Sheikh Zayed Road, including proposals to introduce double-decker sections to add extra lanes without widening the existing corridor.

    The idea was discussed in the context of rising congestion and limited right-of-way along one of the city’s busiest arterial roads, with elevated decks potentially carrying through traffic while existing at-grade lanes served local access.

    The plans ultimately became standalone schemes, with subsequent efforts focusing instead on corridor-wide upgrades, interchange improvements and complementary public transport expansions to manage demand more sustainably.

    The latest project aligns with Dubai’s continued investment in upgrading and expanding its road network to keep pace with rapid population growth and rising commuting demand.

    Planning for growth

    Dubai launched the 2040 Urban Master Plan in March 2021, referencing studies indicating that the emirate’s population will reach 5.8 million by 2040, up from 3.3 million in 2020. The daytime population is set to increase from 4.5 million in 2020 to 7.8 million in 2040.

    In December 2022, Sheikh Mohammed Bin Rashid Al-Maktoum, Vice President and Prime Minister of the UAE and Ruler of Dubai, approved the 20-Minute City Policy as part of the second phase of the Dubai 2040 Urban Master Plan. 

    In addition to the road projects, the RTA’s Dubai Metro Blue Line extension and Dubai Metro Gold Line form part of Dubai’s plans to improve residents’ quality of life by cutting journey times, as outlined in the policy.

    The policy aims for residents to have 80% of their daily requirements within a 20-minute journey, on foot or by bicycle. This goal will be achieved by developing integrated service centres with all necessary facilities and increasing population density around mass transit stations.

    READ THE OCTOBER 2026 MEED BUSINESS REVIEW – click here to view PDF

    Industry and logistics drive development at Neom; Saudi Arabia’s investment priorities realign amid conflict; MEED’s 2026 power developer ranking.

    Distributed to senior decision-makers in the region and around the world, the October 2026 edition of MEED Business Review includes:
    To see previous issues of MEED Business Review, please click here
    https://image.digitalinsightresearch.in/uploads/NewsArticle/20745908/main.jpg
    Yasir Iqbal
  • Libya seeks offshore contractors for $8bn gas project

    19 October 2026

    Libya’s Mellitah Oil & Gas Company (MOG) has invited companies to prequalify for a major offshore package as part of its Mellitah Complex Expansion & CO2 Management Integrated Development Project, which is estimated to be worth about $8bn.

    The package is estimated at around $3bn and focuses on developing offshore pipelines and subsea systems for the “E” Offshore Installation Project and CO2 project.

    The deadline to submit prequalification documents is 5 November. The contract will use the engineering, procurement, installation and commissioning (EPIC) model.

    MOG is a joint venture of Libya’s National Oil Corporation and Italian oil and gas company Eni.

    This is not the first time MOG has invited submissions for the offshore pipelines and subsea systems package. The company originally launched a prequalification process for the EPIC contract in 2021, but the project experienced delays and the process was eventually cancelled. The prequalification process was restarted nearly three years later, but it was also ultimately abandoned.

    Complex expansion

    As part of the Mellitah Complex Expansion & CO2 Management Integrated Development Project, two offshore structures – Structure A and Structure E – will be developed in Libya’s offshore block NC 41.

    Structure A is in the central-western part of the area, about 80 kilometres (km) from the Libyan coast, with a water depth of 95-105 metres.

    Structure E is located in the central-eastern part of the area, about 130km from the Libyan coast, in a water depth of 205-235 metres.

    The scope of the wider project includes:

    • A new wellhead platform installed in 96 metres of water as part of the development of Structure A
    • A new production platform installed in about 220 metres of water depth as part of the development of Structure E
    • Modification of the existing Sabratha platform
    • Sealines and subsea systems for structures A and E
    • Upgrading the existing onshore Mellitah complex
    Project contract awards

    In June 2024, MOG awarded an offshore engineering, procurement and construction (EPC) contract worth €1.2bn ($1.28bn), which was part of the Mellitah Complex Expansion & CO2 Management Integrated Development Project.

    The contract was awarded to a consortium of three Italian companies: Rosetti Marino, Kerry Project Logistics and Gruppo Antonini.

    In a statement, Rosetti Marino said its share of the project contract was worth €400m ($428m), comprising 33% of the total contract value.

    Rosetti Marino said its scope of work includes EPC and load-out activities to deliver the topside of the approximately 6,000-tonne gas production wellhead platform, named WHP-A, to be installed off the coast of Libya.

    Project setbacks

    During 2023 and 2024, several setbacks affected the Mellitah Complex Expansion & CO2 Management Integrated Development Project.

    In November 2023, MOG restarted the prequalification process for an upstream offshore package worth an estimated $700m.

    The project scope involves modifications to the offshore Sabratha platform at the Bahr Essalam field.

    Less than two months later, MOG restarted prequalification for a second package as part of the integrated development project.

    The scope of the second package covers key sealine and subsea systems.

    No reason was given for restarting the prequalification process for two of the project’s packages.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/20738707/main.jpg
    Wil Crisp