OQGN awards EPC contract for RO105mn loop line project
In November last year, OQGN received regulatory approval to construct the new 193km loop line connecting Fahud to Suhar. The pipeline, which will have a diameter of 42 inches, is designed to strengthen Oman's natural gas infrastructure and support regional energy demands.
'OQ Gas Networks is pleased to announce the awarding of the tender for engineering, procurement, and contracting works for the 42-inch second Loop Line Fahud–Suhar Project to The Petroleum Projects Company Petrojet and Partners LLC,' OQGN said in a disclosure to the Muscat Stock Exchange on Wednesday.
The agreement was signed on June 17. 2025, the company confirmed. As part of the project execution strategy, OQGN has also awarded the supply of 193km of line pipe to Jindal Saw Limited.
'It is worth noting that the total project cost is approximately RO105mn, with a planned execution period of 24 months,' the company added.
The project cost will be incorporated into the company's Regulated Asset Base (RAB), and, like the rest of the RAB, the return on this investment will be calculated based on the weighted average cost of capital (WACC). The currently approved WACC under Price Control 3 is 7.79%, and it will remain in effect until 2027, according to OQGN.
The company stated that the Fahud–Suhar Loop Line Project is in line with its growth strategy and vision of leading the energy infrastructure sector.
Described as one of the largest initiatives sanctioned by OQGN since the implementation of the RAB framework, the project is expected to significantly boost gas supply capacity in the Suhar and Ibri regions. It supports Oman's long-term energy strategy and aligns with OQGN's infrastructure expansion objectives.
According to OQGN's earlier disclosure, the Fahud–Suhar Loop Line Project is scheduled for completion in 2027. Once operational, the new pipeline will increase the capacity of OQGN's northern gas network by 9mn standard cubic metres per day, further solidifying the company's role in meeting the growing demand from key industrial and power sectors.
OQGN, which operates the sultanate's only natural gas transportation network, currently manages over 4,000km of pipeline infrastructure across Oman. The network supplies gas to a wide array of critical industries, including power generation, water desalination, cement and aluminium production, fertiliser manufacturing, and petrochemical plants.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Observer
2 days ago
- Observer
OQGN eyes Ibri for carbon capture opportunities
MUSCAT, AUG 11 Pressing ahead with its carbon capture and CCUS ambitions, OQ Gas Networks (OQGN) – the majority state-owned operator of Oman's gas transportation infrastructure – has identified the Ibri Power Project in Al Dhahirah Governorate as a promising candidate for carbon capture in partnership with Occidental (Oxy) Oman. Carbon capture, utilisation, and storage (CCUS), along with green hydrogen transportation, form key pillars of the publicly traded company's strategy to position itself as a leading player in advancing Oman's Net Zero goals. 'The company's strategic stance towards energy transition continues to be a focus, specifically in hydrogen and CCUS,' OQGN stated in its Q2 2025 financial performance report. 'As part of this work, OQGN has signed a cooperation agreement with (Belgian energy infrastructure player) Fluxys to jointly develop hydrogen transportation infrastructure in Oman. On the carbon capture front, the Ibri Power Plant has been identified as a key priority, and OQGN has coordinated with Oxy on the way forward to jointly assess capture opportunities.' The 1,509 MW combined-cycle gas turbine (CCGT) power plant in Ibri is one of Oman's largest gas-fired projects and began operations in Q2 2019. It was developed by Ad-Dhahirah Generating Company, backed by a consortium that includes ACWA Power, Mitsui, and DIDIC as its major shareholders. Oxy Oman is among several local and international entities collaborating with OQGN to advance the Sultanate of Oman's energy transition and decarbonisation goals. In November 2023, the upstream energy company signed an MoU with OQGN to jointly study and develop CCUS projects in Oman, particularly for enhanced oil recovery (EOR) and broader carbon management strategies. Belgian energy infrastructure leader Fluxys is both a strategic partner and an investor, holding a 4.9% equity stake in OQGN. The two companies signed an MoU in October 2023 to collaborate on developing hydrogen and CO₂ infrastructure in Oman. In May 2025, they advanced this partnership by signing a term sheet agreement under which Fluxys will serve as a minority shareholder and co-operator in developing Oman's hydrogen transportation network. In addition, OQGN has joined a Memorandum of Cooperation with Oman's Ministry of Energy and Minerals and other major energy players to form a 'House of Expertise' tasked with developing the regulatory and strategic framework for CCUS technologies and blue hydrogen in support of Oman's Net Zero 2050 targets. Likewise, in collaboration with Hydrom – the architect of Oman's green hydrogen sector – OQGN is conducting technical feasibility studies on open-access pipeline networks for both green hydrogen and CO₂ transport, leveraging its existing natural gas infrastructure to support decarbonisation.
Observer
05-08-2025
- Observer
Oman advances CO₂, green hydrogen pipeline studies
MUSCAT: OQ Gas Networks (OQGN), the majority state-owned natural gas pipeline operator, has announced significant progress in its mandate to roll out dedicated pipelines for green hydrogen and carbon dioxide (CO₂), in support of Oman's energy transition strategy. Publicly traded OQGN — part of Oman's integrated energy group OQ — stated in its newly issued 2024 Sustainability Report that its initiatives are aligned with national strategies to develop new low-carbon industries focused on green hydrogen production and Carbon Capture, Utilisation and Storage (CCUS) technologies, both of which are key to Oman's Net-Zero 2050 targets. This commitment aligns with OQGN's designation as a National Champion for Green Hydrogen and CO₂ Transportation, conferred by Hydrom, the state-run architect of Oman's green hydrogen industry. 'We are (...) actively exploring opportunities in hydrogen and carbon capture infrastructure, aligning with global energy trends shaping the future of our industry', said Mansoor al Abdali, CEO of OQGN. 'Looking ahead, we are poised to play a central role in Oman's energy future. As we invest in network expansion, digitalisation and decarbonisation initiatives, we remain aligned with Oman Vision 2040 and its sustainability goals', he added in the CEO's Message. In 2024, OQGN began working closely with key industry stakeholders to establish itself as 'the partner of choice for hydrogen and CO₂ pipeline transportation'. As part of this ambition, the company initiated collaborations with CCUS developers to create commercial-scale projects that address CO₂ transportation needs. 'We also launched detailed feasibility studies focused on establishing the technical, commercial and regulatory aspects of the pipeline networks', the company stated. Furthermore, in collaboration with Hydrom, OQGN has been leveraging its extensive pipeline expertise in the development of Oman's hydrogen and CO₂ transportation infrastructure. Central to this initiative is a vision for an open-access pipeline connecting green hydrogen production blocks (powered by wind and solar) with derivative plants located along the coast for efficient processing and export. 'This hydrogen pipeline network is being developed in coordination with Hydrom's planned projects in Al Duqm, Salalah and Al Jazir. As domestic demand for low-carbon hydrogen grows, the network will expand to serve industrial clusters in northern and eastern Oman', OQGN noted. 'In an additional step, an open-access CO₂ pipeline network will also link emission sources to sinks. As natural gas demand declines, stranded natural gas pipelines may be repurposed and recommissioned as part of the green hydrogen transportation network', the company added. According to OQGN, a comprehensive long-term Decarbonisation Strategy is currently in place to accelerate the reduction of greenhouse gas (GHG) emissions across the company. 'The strategy drives us towards the goal of Net-Zero by 2050, with ambitious interim targets: a 42% reduction in GHG emissions by 2030 and 82% by 2040. These milestones have been set with consideration for emerging technologies, evolving regulations, shifting stakeholder expectations and our investment strategy — while also balancing urgency with feasibility', it stated.
Observer
02-08-2025
- Observer
Project to strengthen gas supply in Suhar and Ibri
MUSCAT: Integrated Gas Company (IGC) has approved the implementation of a major gas pipeline project aimed at meeting the rising industrial demand in Suhar Port and Ibri. The initiative includes the construction of a 42-inch diameter pipeline stretching 193 kilometres from Fahud in the Wilayat of Ibri, Al Dhahirah Governorate, to Suhar in North Al Batinah Governorate. It will also feature a lateral connection serving the industrial zone in Ibri. The new pipeline is expected to improve the reliability and availability of natural gas supplies to key economic regions, facilitating sustainable industrial growth both now and in the future. IGC, the exclusive authority responsible for issuing gas transmission orders in the Sultanate of Oman, has fully approved the project and entrusted its implementation to OQ Gas Networks—the owner and operator of gas transmission infrastructure in the country. Following a competitive tendering process, OQ Gas Networks awarded the engineering, procurement, and construction (EPC) contract to Petrojet & Partners, valued at RO 105 million. The pipeline supply contract was awarded to Jindal Saw Limited. The project is scheduled for completion within 24 months. Once operational, the pipeline will expand the national gas network by 4.5 per cent and account for approximately 9.5 per cent of the regulated asset base, underscoring its significance to Oman's energy infrastructure. Abdulrahman bin Humaid al Yahyaei, CEO of Integrated Gas Company, described the initiative as a pivotal milestone in the company's strategy to develop a flexible, efficient, and future-ready national gas network. He highlighted the project's role in meeting growing industrial energy needs while reinforcing Oman's position as a regional energy hub. Al Yahyaei added that the project underscores IGC's commitment to establishing a dependable energy system that aligns with Oman's industrial and economic objectives. It will stimulate investment, promote in-country value, create job opportunities, and support the transition to clean energy. He noted that the pipeline will supply Suhar Industrial Port with around 13 million cubic metres of gas per day, addressing the requirements of future industrial projects. A portion of the gas will also be allocated to Ibri Industrial City to support its upcoming development plans. — ONA Abdulrahman bin Humaid al Yahyaei, CEO of Integrated Gas Company.
