Kuwait Petroleum International and Oman Oil Company yesterday formed a 50/50 joint venture to develop the $7bn Duqm Refinery and a petrochemicals complex in the Duqm Special Economic Zone.
The project will be 35 per cent financed by the two partners with the remainder to be raised from local and international banks, Oman Oil Company CEO Hilal al-Kharusi said, according to reports.
The Duqm facility will have a capacity of 230,000 barrels per day when completed in 2019 and Kuwait’s oil minister Essam Al Marzouq indicated this could be fully met with oil from Kuwait although initially the country will provide 65 per cent.
Agreements to provide this crude are still being finalised by Kuwait Petroleum.
A joint team from the two companies is also assessing tenders from contractors for the construction and management of the facility.
The two sides first signed a memorandum for the facility, located in Al Wusta Governorate, in November.
This followed Abu Dhabi’s International Petroleum Investment Company’s withdrawal from the project last year after first founding a joint venture with Oman Oil Company in 2012.
The overall site is spread across 900 hectares just north of the port of Duqm and will be connected to a liquid jetty pipeline system designed to accommodate ships with a capacity of around 150,000 deadweight tonnes.
Speaking more broadly, Marzouq said he expected conformity with the OPEC/non-OPEC oil cut deal to have increased in March from rates of 87 per cent in January and 94 per cent in February.