in Business
By Conrad Prabhu — MUSCAT: July 24: Gas-based power generation will soon become a reality in Musandam Governorate when the first Independent Power Project (IPP) in the Sultanate’s strategically important enclave in the north — which overlooks the Strait of Hormuz — comes into operation next February. Musandam Power Company (MPC), a joint venture of the wholly government owned investment entity Oman Oil Company and LG International Corp of South Korea, is currently developing the 120-megawatt (MW) capacity plant at Tibat. When brought online in February 2017, the new IPP will supplement diesel-based generation output operated by the Rural Areas Electricity Company (RAECO), a subsidiary of the Nama Group tasked with providing electricity and potable water coverage in areas falling outside the nation’s grid-connected zones.
According to Oman Power and Water Procurement Company (OPWP), the sector’s sole procurer of new electricity generation and water desalination capacity, the new Musandam IPP will meet projected electricity demand growth in the governorate at least through 2022.
RAECO currently owns and operates a string of diesel-based power stations offering a combined installed capacity of around 91 MW in the governorate. The largest of these plants — a 57 MW capacity diesel powered station — currently supplies Khasab town.
Importantly, the IPP is under construction not far from a new oil and gas processing plant at Tibat, owned and operated by Oman Oil Company Exploration & Production LLC (OOCEP), a subsidiary of Oman Oil Company.
The Musandam Gas Plant, as it is known, processes production fluids from the nearby offshore Bukha A and West Bukha fields and has a processing capacity of up to 20,000 barrels of crude, 45 million cubic feet of gas and 75 tonnes of LPG per day. Part of the natural gas output will be used to power the new IPP.
With its anticipated launch early next year, the new Musandam power project will add to the governorate’s growing civil infrastructure designed to leverage, among other features, its geo-strategic location and untapped commercial and tourist appeal. With economic ties with Iran across the Hormuz Strait set to burgeon, coupled with strong prospects for tourism investment, Oman is moving to develop the governorate’s infrastructure to help capitalize on these opportunities.
Khasab, an emerging hotspot for cruise tourism, dhow trips, dolphin watching and adventure tourism, is proposed to be developed into a full-fledged destination. Omran has been tasked with developing Khasab Port into a mixed use waterfront based tourism attraction. Furthermore, to help meet Khasab’s growing potable water needs, OPWP is preparing to launch the tendering process for the procurement of the governorate’s first Independent Water Project (IWP). Khasab IWP, with a capacity of 16,000 cubic metres per day (3 million imperial gallons per day MIGD), is targeted for launch in Q4 2019. “The procurement process is expected to begin in 2016, pending final site approvals,” OPWP said.
