OQ courts other partners for petrochemical complex in Oman as SABIC drops out
Oman's state energy group OQ is in talks with new potential partners for its planned petrochemical complex in Duqm after Saudi Arabia's SABIC withdrew, said OQ CEO Ashraf Al Mamari.
SABIC decided "to withdraw from the project, so now it is us and the Kuwaiti side," Mamari told Reuters in an interview, without giving details on the reason for the decision.
SABIC, whose withdrawal from the project in Oman has not been previously reported, had no immediate comment.
Duqm port on Oman's southwest coast is close to its major oil and gas projects, where OQ and Kuwait Petroleum International last year inaugurated a $9 billion refinery called OQ8, with plans for a petrochemical project close by.
"Currently it's on a 50-50 (shareholding) basis and in parallel, we are discussing with some partners if they would be interested in joining as a third partner," Mamari said without giving any names.
"We are discussing with both technology solutions providers and partners or even financial partners. When it comes to the equity share and split, we did not decide that yet, which will depend on the progress of the project," he said.
SABIC is restructuring as the chemicals industry faces with weak demand. It is 70% owned by oil giant Aramco, which is cutting costs and selling assets as it balances capital expenditure with lower oil prices and shareholder payouts.
OQ is owned by Oman's sovereign wealth fund and has a portfolio of companies ranging from exploration and production to refining, chemicals, trading, hydrogen and renewables.
Mamari said it is also in early talks with foreign investors, including U.S. and Asian firms, about potential partnerships and equity investments in some of its "key projects", citing higher investor confidence as the country's and OQ's credit ratings have improved in recent years.
Oman, a small non-OPEC oil producer, is following other Gulf countries in economic diversification efforts, including with a privatization drive to attract foreign investors.
That, along with fiscal reforms, has helped the Sultanate pay down debt and turn its large fiscal deficit into a surplus since 2022. Credit rating agency Fitch upgraded it to investment grade this week.
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