Muscat: Oman Oil Company and its subsidiary Takamul Investment Company have formed a joint venture firm – Oman Tank Terminal Company (OTTCO) - to build, own and operate upto 200 million barrel oil terminal, which is going to be the largest crude storage terminal in the Middle East region, in Ras Markaz in Al Wusta region.
OTTCO will be 90 per cent owned by OOC and 10 per cent by Takamul. The size and strategic geographic location of the terminal provide an excellent opportunity for it to emerge as an important global hub in the Middle East for storage and trading like Singapore in Asia and Rotterdam in Europe.
Also, the Ministry of Oil and gas and OTTCO yesterday signed a memorandum of understanding (MoU) for the construction of crude oil pipeline that will connect Ras Markaz terminal with the main oil line at Nahada.
The terminal will be built in phases and the first phase is expected to be operational by 2017. "The development of this world-scale crude oil terminal will be of strategic importance not only for Oman, but for the whole Middle East and Asia region. The Middle East being the largest exporting region, occupies a significant position in the global crude trade and this will be strengthened in coming years, with increasing trading volumes from this region. Moreover, the terminal will attract the local, regional and international oil companies, traders and both exporting and importing countries looking for strategic crude storage," said Nasser bin Khamis Al Jashmi, undersecretary at the Ministry of Oil and Gas.
The terminal project will be funded by Oman Oil Company, foreign investors and banks, said Ahmed Al Wohaibi, Chief Executive Officer of OOC. Ras Markaz is 70 kms north of Duqm. The natural depth of 32 meters and its location on the Indian Ocean gives Ras Markaz an advantage to handle largest size crude carriers.
The MoU also includes strategic plans to develop storage capacity for Oman crude as it will be stored at Ras Markaz terminal prior to exporting to the international market. "The total storage capacity of 200 million barrels will make this terminal one of the largest storage terminals in the world," said Al Wohaibi. "It is expected that the total investments in Duqm in the coming years will reach approximately $15 billion. The mega projects of OOC like storage, refinery and petrochemicals, with further developments in the downstream value chain will facilitate growth of ancillary industries and services, improve the infrastructure facilities and increase employment opportunities in Al Wusta governorate," Al Wohaibi added.
The terminal will serve the storage requirements for various customers, including the proposed refinery in Duqm and also provide blending facility for crude. It will provide and operate different tank sizes, with a capacity of 755kbbl, 1mbbl and 1,75mbbl each. The terminal enjoys the advantage of being connected via a dedicated pipeline to supply crude oil to the Duqm refinery.
Around 42 per cent of global trade in oil passes through Strait of Hormuz and it is projected to increase to 50 per cent in the next 20 years. "The construction of a crude oil pipeline between Nahada and Ras Markaz for the export of Oman Crude Oil Blend next to Mina Al Fahal is of strategic importance. The Pipeline to Ras Markaz terminal will further boost the export of Oman Blend and increase the reliability of crude supply to the market," noted Dr Mohammed bin Hamad Al Rumby, Minister of Oil and Gas.