Prequalification opens for Oman Crude Oil Park contract

International energy infrastructure contractors have been invited to register for a contract to construct a giant crude oil storage terminal at Ras Markaz.

02 June 2015
MUSCAT: International energy infrastructure contractors have been invited to register their interest in bidding for a lucrative contract to construct a giant crude oil storage terminal at Ras Markaz on Oman's Wusta coast.
The mammoth facility, billed as one of the largest crude storage facilities in the world when fully operational, is being developed by Oman Tank Terminal Company (OTTCO), a joint venture between Oman Oil Company (90 per cent) and its downstream investment subsidiary, Takamul Investment Company (10 per cent).

Yesterday, OTTCO announced the start of a competitive process leading to the award of a contract for the Detailed Engineering Design, Procurement, Construction, Pre-Commissioning and Commissioning, on a lump sum turnkey basis, of the massive scheme.

Known officially as 'Ras Markaz Crude Oil Park', the facility will come up at a green-field site covering an area of around 1,600 hectares located 70 kilometres south of the Duqm Special Economic Zone (SEZ), the Sultanate's newest mega industrial and maritime hub.

At full build-out, the crude oil park will have a capacity to hold around 200 million barrels of crude. However, targeted for implementation in the first phase of the project is a capacity of around 25 million barrels, which is slated to come on stream by the end of 2018. Phase 1 capex is expected to amount to a ballpark of $700 million, say experts.

According to industry analysts, OTTCO's invitation to international engineering firms to prequalify for the construction phase underscores the Omani government's determination to press ahead with the implementation of the project despite the continuing slump in international crude oil prices.

Duqm's strategic location, among other geopolitical considerations stemming from current developments in the region, has only helped to further reinforce the strategic and commercial appeal of the project, they argue.  Additionally, the Ras Markaz terminal will serve as a strategic alternative to Oman's only crude oil export terminal currently in operation at Mina al Fahal in Muscat.

Front-end engineering design (FEED) work on the venture is being undertaken by UK-based global oil and gas engineering firm Amec Foster Wheeler. Both onshore and offshore elements of the project are being incorporated into the FEED, although the successful EPC contractor will have to come up with a detailed engineering design before undertaking the construction of the first phase.

Separately, state-owned gas transportation utility Oman Gas Company (OGC) has undertaken a pre-feasibility study of an oil pipeline that will tap into the nation's Main Oil Line at Nahada in central Oman, and transport crude over a 440 km distance to Ras Markaz.

A separate pipeline will connect the Ras Markaz terminal with a new $6 billion refinery currently in the early stages of execution at Duqm SEZ. The 230,000 barrels per day capacity refinery is being developed by Duqm Refinery and Petrochemical Industries, a 50:50 joint venture partnership of Oman Oil Company and IPIC of Abu Dhabi.

Qualified international firms have until June 29, 2015 to register their interest in bidding for the crude oil terminal construction package.

© Oman Daily Observer 2015