A $956 million (Dh3.5 billion) plant that will convert petrochemicals into raw materials used in the production of plastics, polyester fibres and other substances will be built by Oman Oil Co in the Sohar Industrial Port Area.
The project will help develop Oman's petrochemical industry and is in line with the Omani Government's long-term strategy, Maqbool Bin Ali Sultan, Oman's Minister of Commerce and Industry and chairman of Oman Oil, said in a statement to Oman News Agency.
The plant will produce 800,000 tonnes of paraxylene and 210,000 tonnes of benzene a year.
Paraxylene is a key raw material in the production of polyester fibres. The other petrochemical to be produced by the complex is benzene.
Benzene is an industrial chemical used to produce a wide range of plastics, nylons, detergents and other chemicals.
The project's basic engineering contract was awarded to Axens, a French company serving the refining, petrochemical and gas processing sectors.
Bin Ali Sultan and Jean Sentenac, chairman and chief executive of Axens, signed the contract in Oman on Tuesday.
The basic engineering for the plant is scheduled to be completed by the end of September this year.
The front end engineering design will be undertaken by Jacobs Consultancy in parallel with the basic engineering.
Omani companies are expected to participate in the construction and operation of the plant creating jobs for nationals.
Oman Oil's board has approved the sale of a 20 per cent equity stake in the project to state-owned Oman Refinery Co.
Oman Refinery is the owner of all hydrocarbons and utilities produced at Sohar Refinery Co. The plant will use naphtha supplied by Sohar Refinery.
Additional equity investors are expected to be invited prior to the launch of financing.
Dr Mohammad Bin Hamad Al Rumhi, Oil and Gas Minister, deputy chairman of the Oman Oil's board, Engineer Ahmad Bin Salim Al Wahaibi, the company's chief executive, and other officials witnessed the signing of the basic engineering contract.
Oman Oil is a commercial company 100 per cent owned by the Omani Government.
The company was created in 1992 to give the government another vehicle for pursuing investment opportunities.
Axens, which is located in Paris, was formed on July 1, 2001, through the merger of IFP's (Institute Francais du Ptrole) technology licensing division with Procatalyse Catalysts and Adsorbents.
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