Muscat: GlassPoint, the leading provider of solar steam generators to the oil and gas industry for applications such as Enhanced Oil Recovery (EOR), is considering setting up a manufacturing facility and supply chain in Oman provided there is a demand for it, said Rod MacGregor, president and CEO of Glasspoint. This is an area, he said, that will generate jobs.
Releasing a new report titled 'Solar Enhanced Oil Recovery: An In-Country Value Assessment for Oman', by Ernst and Young, Rod MacGregor said, "The GlassPoint system being used at an existing thermal EOR project in southern Oman since December 2012 after it was delivered on time and within budget, is performing above target specifications.
"The PDO is very pleased with the performance. The question now is, what's next? So we engaged Ernst and Young to undertake research and write a report which is before us."
He added, "The report found that full-scale deployment of solar EOR by the end of 2023 in Oman could save half a billion cubic feet (bcf) of natural gas per day and generate up to 212,000 jobs throughout the Sultanate. This does not include up to 90,000 construction jobs to support full-scale deployment."
Rod MacGregor further stated that eventually, every oil field will have to go in for solar EOR; it is only a question of how and when. Bahrain, Kuwait and Saudi Arabia have either announced major EOR projects or have started pilot projects. But Oman has a great advantage to get into a leadership position as far as solar EOR project is concerned. We hope the latest report opens up opportunities for Omani companies to adapt to solar EOR technology."
The report puts forward the case for Oman to become a solar power hub in the GCC region, creating a local industry that could benefit the region in gas savings, job creation, carbon emissions reduction and economic diversification. The report projects that towards the end of 2023, solar EOR can add $12 billion to the Omani economy, create 212,400 permanent jobs in Oman and release more than half a billion cubic feet of natural gas per day, which can be diverted to other higher-value uses.
The goal of solar EOR is to reduce the amount of natural gas burned for thermal EOR, releasing gas for higher value applications, including power generation, desalination, industrial development and export.
"EOR is of strategic importance to Oman's future oil production, but its use of natural gas creates a gas supply conflict with other national priorities," said Mark Gregory, EY chief economist. "Using solar energy for steam production will free valuable gas resources needed to power new industries and diversify the economy. Furthermore, if Oman were to localise the supply chain for solar steam generators, solar EOR could contribute more than $12 billion to Omani GDP over the next decade."
Gas not burned for EOR will fuel industrial expansion
Natural gas used for oil production accounts for almost a quarter of Oman's total gas consumption, and that figure is growing rapidly. EY concluded that the full-scale deployment of solar EOR in Oman, in which solar produces 80 per cent of the steam needed for EOR, would redirect up to 531,000mcf of gas per day by the end of 2023.
The gas not burned for EOR can be used for higher-value applications, such as LNG export and power generation. Additionally, gas can be redirected to the Omani private sector, where dozens of industrial projects have been cancelled or stalled in the past decade due to gas shortages.
"Greater access to natural gas is critical to achieving economic diversification," said Ahmed Amor Al Esry, partner and oil and gas sector leader at EY Muscat. "Gas used for oil production means less gas to power Oman's growing economy. Solar EOR can help maximize our existing gas resources, which could have a transformational impact on the future of the Sultanate."
Establishing a world-class solar power industry in Oman
Oman is well-positioned to grow into a hub for solar EOR technologies and supporting industries. As a result, the nation's workforce will develop greater expertise across solar technology innovation, project deployment and manufacturing. Experience with solar EOR development will transfer to other energy-related sectors, fostering broader economic growth.
As the pioneer of solar EOR, Oman can seize regional and global export opportunities which can create additional jobs by localizing the solar supply chain and ancillary industries. Coupled with the impact of gas savings, full-scale solar EOR deployment across the region could create up to 212,000 permanent jobs in Oman, as well as an additional 90,000 jobs to support project construction.