OQ showcases strategic directions and priorities at Sohar Investment Forum

Business Tuesday 27/February/2024 15:15 PM
By: Times News Service
OQ showcases strategic directions and priorities at Sohar Investment Forum

Muscat: OQ, the global integrated energy group, participated as a strategic sponsor at the Suhar Investment Forum, showcasing its commitment to bolstering investments and creating opportunities for investors in the plastics industries. Ashraf bin Hamed Al Mamari, Acting Group CEO of OQ, presented a paper at the forum outlining the group's strategy aimed at facilitating the energy transition and embodying its vision to maximise the value of Oman's energy resources, transition towards a sustainable future and achieve the government's objectives of enhancing sustainable economic diversification in the energy value chain, in addition to realising OQ values of Perform, Collaborate and Care.

Al Mamari delved into OQ Group's strategic priorities, highlighting a comprehensive approach aimed at achieving operational excellence and sustaining competitiveness across all fronts. These priorities encompass:

  • Operational Excellence: Ensuring the application of best practices to maintain a competitive edge across all assets and fostering a performance-driven culture within the organisation.
  • Financial Discipline: Upholding financial discipline by maintaining capital structures and enhancing operational efficiency, thereby ensuring prudent financial management.
  • Exploration of Economic Growth Opportunities: Proactively exploring economically viable growth opportunities across all strategic business units to drive sustained expansion.
  • Enhancement of Business Environment: Strengthening the business environment by providing managerial and operational competencies, thereby fostering an environment conducive to growth and innovation.
  • Energy Transition: Targeting a transition in the energy sector to mitigate carbon emissions through improved energy efficiency, investment in renewable energy sources, and the adoption of carbon capture, storage and utilisation technologies.

In addition, OQ's strategic priorities include leveraging technology and fostering innovation. This involves the continuous development, evaluation and implementation of new technologies to enhance operational processes and overall business performance.

The Acting GCEO further highlighted that OQ Group's strategic directions, particularly in its upstream segment, entail OQ's commitment to continued growth, maintaining a robust portfolio of successful investments and ensuring strong cash flows. Moreover, it involves enhancing collaboration with partners who share aspirations for responsible utilisation of oil and gas resources and reducing carbon dioxide emissions through clean energy initiatives.

In the commercial and downstream segment, Al Mamari elucidated that strategic priorities revolve around multiplying the value of current investments and fostering partnerships. This includes a commitment to furthering the value of the hydrocarbon sector in Oman by competitively investing and reducing carbon emissions.

Additionally, in the commercial sector, strategic directions involve increasing the value of hydrocarbons while assuming a leadership role in supply, marketing, carbon trading operations, and expanding the group's portfolio to increase investments in liquefied natural gas (LNG).

Regarding the retail sector, the focus is on doubling the value of the local retail sector through non-fuel revenues and value-added growth internationally through the Oman Oil Marketing Company.

Ashraf Al Mamari further elaborated on OQ's strategic focus, emphasising a dedicated approach towards alternative energy. This includes:

Excellence in Alternative Energy: OQ aims to excel in the field of alternative energy by reducing emissions from its current assets while improving energy density.

Clean Electrons Utilisation: Within its strategic priorities, OQ intends to utilise clean electrons to supply its assets with clean energy, thereby reducing emissions.

Integration of Low-Carbon Projects: By incorporating numerous low-carbon investment projects, OQ seeks to diversify its portfolio while reducing its carbon footprint.

Deployment of Negative Emissions Technology: OQ is committed to deploying negative emissions technology aimed at reducing atmospheric carbon dioxide to mitigate the effects of climate change.

He also highlighted OQ Group's financial results for the first half of 2023, showcasing its excellence in improving financial performance. Furthermore, he outlined the group's achievements between 2023 and February 2024, among which the following stand out:

Inauguration of the Duqm Refinery under the auspices of His Majesty Sultan Haitham bin Tarik and His Highness Sheikh Mishal Al Ahmad Al Jaber Al Sabah.

Opening of the Bisat Oil Field and OQ's Ammonia Plant in Dhofar Governorate.

Progress of the OQ-operated Oman Tank Terminal Company (OTTCO), which manages the Ras Markaz Oil Storage and Export Terminal.

Upgrade of OQ's credit rating by Fitch Ratings from B+ to bbb-, which is an investment-grade rating, with long-term IDR rating upgraded to BB+ from BB.

Successful public offering of shares for Abrar Energy Services and OQ Gas Networks, marking the largest initial public offering in the history of the Muscat Stock Exchange.

OQ's designation as champion of renewable energy development in Oman.

Recognition by the Ministry of Energy and Minerals for OQ Gas Networks as the company responsible for hydrogen transportation and tasked with planning, developing and facilitating a hydrogen transportation network in Oman.

Increase in Omanisation percentage to 84%.

Achievement of over one billion US dollars in local spending by the group.

The Acting Group CEO also reflected on OQ's journey, tracing its beginnings back to 1982, and highlighted its evolution and growth alongside advancements in refining, petrochemical industries, exploration, production and alternative energy.

Regarding OQ's priorities related to environmental, social, and corporate governance (ESG) practices, he emphasised initiatives such as carbon removal, water management, diversity, equality, responsible procurement practices, health and safety and effective social investments.

In discussing the value chain of the plastics industry sector, Ashraf Al Mamari underscored the significant impact of the downstream segment on increasing value-added through manufacturing processes. He noted that a million square metres have been allocated to the plastics industries for a debtor complex, with investments totaling USD 88 million through the signing of nine agreements.

Al Mamari highlighted that OQ has adopted four clear pathways to enhance the resilience of its core businesses and facilitate opportunities for growth and income diversification. These pathways include strategies focusing on carbon removal and energy efficiency, clean electrons and low-carbon particles and the mitigation of negative emissions.

The paper also addressed the growth in clean energy capabilities, with the Acting GCEO of OQ Group pointing out the potential to produce renewable energy reaching 2.6 gigawatts by 2028. During the first phase, projects exceeding 500 megawatts will serve OQ's assets and workers in the oil and gas sector by 2024. The second phase includes a portfolio of projects approaching 840 megawatts for customers in the Sohar Industrial Zone, where carbon removal is needed. The third phase involves covering other industrial areas with a capacity of 1053 megawatts.

The discussion extended to alternative energy projects in locations such as the Oxy Block, producing 70 to 140 megawatts, and the Oman Independent Power Project, with a solar energy capacity of 200 megawatts at 100%. The Amin Plant, with a production capacity of 125 megawatts, in which OQ contributes 30%, was also highlighted, along with projects currently underway.

Promising prospects for alternative energy projects were noted, including the Hyport Duqm (under development) with a production capacity of 1.3 gigawatts, the Green Energy Oman Project with a production capacity of 25 gigawatts, the Liwa Solar Power Station (under development) with a renewable energy capacity of 93 megawatts, the Block 60 Solar Project (under development) with a renewable energy capacity of 35 megawatts, and the Salalah2 Project (under development) with a renewable energy capacity of 3.8 megawatts.