OQ, France’s TotalEnergies to build an LNG hub in Oman

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France’s TotalEnergies and Oman National Oil Company (OQ) have agreed to build a liquefied natural gas (LNG) plant that is set to be the first LNG bunkering hub in the Middle East.

The Marsa LNG project, which is 80 per cent owned by TotalEnergies and 20 per cent by OQ, includes upstream gas production, a one million-ton-per-year liquefaction plant to be built in the port of Sohar and a 300-megawatt (MW) solar plant to reduce the facility’s emissions.

The plant will be 100 per cent electrically driven and supplied with solar power, positioning the facility as one of the lowest greenhouse gas emissions intensity LNG plants ever built globally, TotalEnergies said in a statement on Monday.

The LNG project will serve as the first LNG bunkering hub in the Middle East, showcasing an available and competitive alternative marine fuel to reduce the shipping industry’s emissions. The engineering, procurement and construction contracts have been awarded to Technip Energies for the LNG plant and to CB&I for the LNG tank.

The project is expected to generate long-term employment opportunities and significant socio-economic benefits for Sohar and the entire Middle East region.

TotalEnergies and a unit of OQ are also at an “advanced stage of discussions to jointly develop a portfolio of up to 800 MW, including the 300 MW solar project that will supply Marsa LNG”.

The French energy firm also signed a sale and purchase agreement with Oman LNG to offtake 0.8 million tonnes per annum (Mtpa) of LNG for ten years from 2025.

The sale and purchase agreement finalises a deal announced in October for Oman LNG to extend supplies to shareholders including Shell and TotalEnergies for up to 10 years beyond 2024.

“This very innovative project illustrates our pioneer spirit and showcases the relevance of our integrated multi-energy strategy, with the ambition of being a responsible player in the energy transition,” said Patrick Pouyanné, the chairman and CEO of TotalEnergies.

“By paving the way for the next generation of very low emission LNG plants, Marsa LNG is contributing to making gas a long-term transition energy.”

Last week, Oman LNG signed a 10-year LNG supply agreement with Shell, according to state-run Oman News Agency. The deal involves up to 1.6 million metric tonnes of LNG a year and will start from next year.

Read: Qatar’s new LNG expansion plans to squeeze out competitors