Gas demand in the Sultanate of Oman is anticipated to range between 37.7 billion cubic metres (BCM) per annum in a low-case scenario to as high as 54.5 BCM in a high-case scenario through to the year 2043, underscoring natural gas’s continued role in sustaining economic growth amid a planned transition to greener energy fuels.
The outlook for gas demand growth in Oman is a key part of a report compiled by UK-based Gas Strategies Group Ltd, an independent leading global gas and LNG commercial advisory firm, which was commissioned by OQ Gas Networks (OQGN) to prepare a market study on the natural gas industry and the gas transportation network in Oman.
OQGN, which owns and operates the country’s Natural Gas Transportation Network (NGTN), has just wrapped up a landmark public subscription covering 49 per cent of its share capital.
Summing up the high-level findings of Gas Strategies’ market report, OQGN said: “Gas Strategies expects gas demand in Oman to remain stable over the next 20 years, with gas supply for LNG exports being an important foundation source of demand. Diversification of gas demand across sectors and geographically across the country provide resilience to total gas demand and, accordingly, to the utilisation of the network on a regional basis.”
It further added: “Gas Strategies expects that flows through the NGTN will continue at least for the next 20 years, with no meaningful reduction in throughput over that timeframe.”
In comparison, OQGN – which oversees the roughly 4,000km long Natural Gas Transportation Network (NGTN) - transported 39.4 BCM of gas in 2022. These volumes came primarily from six producers – Petroleum Development Oman (53 per cent), BP Oman (39 per cent), Dolphin Energy (5 per cent), Oxy, OQ Exploration & Production, and Ara Petroleum. Consuming these volumes were a total of around 130 consumers distributed across critical sectors, including power and water, petrochemicals and refining, industries, manufacturing clusters, and others.
Significantly, Gas Strategies singled out the central-case as the most likely of the three scenarios expected to play out over the next two decades through to 2043.
In this scenario, continued strong activity in the upstream hydrocarbon sector is expected to support strong GDP growth. “The economy begins to pivot towards new energy sectors in the 2030s. Increased penetration of renewable power generation and new industrial and petrochemical facilities being built with green feedstocks leads to reduced scope for gas demand growth in the 2030s. Nevertheless, total gas demand in 2043 can be expected to be higher than it was in 2022. Considering multiple factors, including the continued upstream gas production and the low likelihood of accelerated renewable energy investment, Gas Strategies considers this Central Case the most likely scenario,” OQGN stated, citing the consultant’s findings.
Buoying hopes for higher gas volumes to come on stream is a raft of ongoing exploration projects. They include the following Exploration & Production Sharing Agreements signed with (i) Shell and TotalEnergies in September 2022 covering undeveloped gas discoveries in Block 11 in western Oman; (ii) TotalEnergies and PTTEP in February 2022 for Block 12, and (iii) Eni and BP in July 2019 for Block 77 in central Oman.
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