Project Valued at USD 124 Million

OQ, the global integrated energy group, today celebrated the groundbreaking ceremony of the strategic fuel reserve project in the Dhofar Governorate, marking an investment of over 47 million Omani Riyals (equivalent to USD 124 million). The ceremony was held under the patronage of His Highness Sayyid Marwan bin Turki Al Said, the Governor of Dhofar, and attended by various officials and dignitaries from the governorate.

The strategic fuel storage facility aims to enhance the local fuel supply in Dhofar and ensure preparedness for emergency situations by storing key petroleum derivatives, including MOGAS-91, MOGAS-95, Gas Oil and jet fuel. With a storage capacity exceeding 110,000 cubic metres, the facility is designed to secure a 30-day fuel supply for Dhofar, thereby enhancing the governorate's resilience to potential energy crises.

This initiative is part of OQ’s broader efforts to meet the nation’s demand for petroleum products, aligning with the growing population and the surge in commercial and investment activities.

On this occasion, His Highness Sayyid Marwan bin Turki Al Said, Governor of Dhofar, praised the project, stating, "This project is a culmination of the efforts made by various entities in the Sultanate of Oman, led by the Ministry of Energy and Minerals and OQ Group, aimed at enhancing the infrastructure for sustainable energy in the Dhofar Governorate in particular and the Sultanate of Oman in general. It ensures the growing demand for petroleum derivatives is met. We are confident that this investment will significantly contribute to supporting sustainable economic development in the governorate and securing various needs, including during emergencies.”

His Excellency Eng. Salim bin Nasser Al Aufi, Minister of Energy and Minerals, emphasised that: “The groundbreaking of the strategic fuel reserve project in Dhofar is a significant step in reinforcing Oman’s strategic fuel reserves, ensuring the availability of essential products, and securing supplies during emergencies. This development is crucial in guaranteeing our petroleum product needs are met.”

His Excellency further highlighted that a similar strategic fuel reserve project is scheduled to commence soon in the Musandam Governorate, with a planned capacity of 14,536 cubic metres. Upon completion, this initiative will elevate the nation’s total fuel storage capacity to over 350,000 cubic metres, encompassing key facilities such as the 160,000 cubic metre Jifnain station in Muscat Governorate, the 19,700 cubic metre Suhar station in North Al Batinah Governorate, and the 37,000 cubic metre Raysut station.

In a speech delivered at the ceremony, Ashraf Hamed Al Mamari, Group CEO of OQ, stated: “The strategic fuel storage facility, with a capacity of 110,000 cubic metres, is another milestone in OQ’s investments in Dhofar Governorate, complementing our existing projects such as the liquefied petroleum gas (LPG), ammonia, methanol plants, and gas pipelines.”

He explained that "The strategic fuel reserve project in Dhofar has been initiated under the directive of the Omani government, represented by the Ministry of Energy and Minerals, which places great importance on ensuring the supply of petroleum products across all governorates in the Sultanate.

He noted that all aspects related to the project’s commencement, such as engineering contracts and land usufruct agreements in the Salalah Free Zone, have been finalised. Al Mamari further emphasised that OQ is committed to securing the supply of petroleum derivatives for Oman, with a total refining capacity of 530,000 barrels per day. This includes the production capacity of the Duqm Refinery at 230,000 barrels per day, the Mina Al Fahal Refinery at 116,000 barrels per day, and the Suhar Refinery at 198,000 barrels per day.

The project consists of three key components: a fuel reserve facility within the free zone, a pipeline connecting the pumping station at Salalah Port to the fuel storage tanks in the free zone, and the expansion of the existing pumps at Salalah Port. Additionally, the new Salalah station will be connected to the existing Raysut station.

The reserve facility will be built on an area of 150,000 square metres, with the construction phase set to span 36 months, encompassing engineering works, procurement, and construction activities, culminating in the initial operation.

The facility will feature tanks, a warehouse, a control room, an administration building, a maintenance workshop, a pump area, a tanker loading zone, firefighting and safety facilities and other complementary components. Provisions for future expansion and increased storage capacity have also been considered.

OQ continues to secure the production of petroleum derivatives, which play a vital role in supporting Oman’s industrial sector. In 2023, OQ Refineries and Petroleum Industries produced over 15.7 million barrels of MOGAS-91, 11 million barrels of MOGAS-95, 32.4 million barrels of gas oil, 9.8 million barrels of jet fuel, and 7.8 million barrels of LPG.