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Project to add value to Oman LPG resources
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Tuesday, 06 Nov 2012

Newly unveiled plans by majority state owned Takamul Investment Company to process Liquefied Petroleum Gas into commercially valuable derivatives, signal a vigorous effort by the Omani government to add value to its hydrocarbon and petrochemical resources.

The downstream investment subsidiary of Oman Oil Company recently took the wraps of an extensive roster of projects for implementation downstream to existing ventures in the petrochemicals, metals and minerals sectors. Investments in these projects, numbering some 30 in all are expected to exceed a billion dollars.

One such downstream venture currently being explored by Takamul centers on plans to process LPG into value added derivatives. It is understood that LPG as feedstock for the proposed venture will be sourced from gas networks that crisscross the length of the Sultanate. The objective is to maximize revenues to the government by extracting commercially valuable ingredients from natural gas before it reaches consumers downstream.

LPG is primarily used as a cooking fuel, as well as an industrial heating fuel. But based on its chemical compositions, LPG can be a useful raw material for the chemical industry and is widely applied in the production of various chemical products. Through chemical processing, LPG can be converted ethylene, propylene, butylene, butadiene and so on, which in turn can used in the production of synthetic plastics, fibres and rubber as well in the manufacture of pharmaceuticals, dyestuff and so on.

The move assumes significance in the context of similar efforts by another Oman Oil subsidiary, Oman Gas Company to study the feasibility of extracting LPG and condensates from the Salalah gas pipeline network in southern Oman.

As the Sultanate's principal natural gas transportation utility, OGC oversees and operates the country's 2,500 kilometers long Government Gas System a critical lifeline that supplies fuel and feedstock to the nation's industries and power plants among other consumers. The pipeline network, together with ancillary facilities, is spread across the length and breadth of the country, extending from Fahud, Sohar and Muscat in the north and from Saih Rawl to Salalah in the south.

In May, OGC announced the appointment of Spanish international oil and gas engineering firm, TECNA to undertake the conceptual engineering design of facilities for the extraction of LPG and condensates from the Salalah segment of the gas network. The study aims to assess the potential recovery of LPG at various points along the Salalah pipeline network. The success of this study will determine whether extraction may be extended across the length of the pipeline grid.

TECNA's study focuses on OGC's Salalah Gas System comprising of 24 inch and 32 inch gas pipeline infrastructure which transports gas from central Oman to Salalah. The southern grid is supplied by natural gas primarily from the Central Processing Plant at Saih Rawl and supplemented with volumes from the Abu Tubul, Khazan and Makarem and Rabab fields. Supplies from the northern grid come via PDO's interlink compressor.

Consumers downstream at Salalah include Raysut Industrial Estate, Raysut Cement, Dhofar Power, Salalah Methanol, Octal and the new Salalah Sembcorp Power and Water Company. Also as part of its brief, TECNA will evaluate options and available technologies for the extraction of LPG, natural gas liquids, C2+ and other condensates from natural gas supplies. The company is also required to develop the scope of work for the front end design engineering and basic engineering of the extraction facilities.

Source - Oman Daily Observer


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