The Ministry of Energy and Minerals, Oman signed a Letter of Intent with Oman Shell company to explore opportunities for the production of Liquefied Synthetic Gas (LSG) in the Sultanate of Oman.
LSG is produced when green hydrogen is combined with captured carbon dioxide to produce natural gas which is then liquefied. This low-carbon gas can be directly introduced to existing gas networks and infrastructure, including the liquefied natural gas stations of the Oman LNG Company, all the way to the end user.
The agreement was signed by Eng. Salim Nasser Al Aufi, Minister of Energy and Minerals, and Walid Hadi, Senior Vice President and Country Chair, Oman Shell.
Commenting on the agreement, Eng. Salim Al Aufi said, “This agreement is evidence of our confidence in the future of the Sultanate of Oman as a multiple energy source hub, as well as the rapid development of its interest in renewable energy and green hydrogen production. The Ministry works with care to achieve optimal utilization of the Sultanate of Oman’s natural resources, by employing capabilities and modern technologies in the fields of energy with our partners in the sector.”
Additionally, Oman LNG LLC and Shell International Trading Middle East FZE announced the signing of a term sheet for the offtake of 0.8 million ton per annum (mtpa) of Liquefied Natural Gas from Oman LNG, for ten years starting from 2025.
Such step marks another milestone in the history of Oman LNG, where it complements the company’s strive to extend its contracts Beyond 2024, with a strong interest to leverage partnership with various firms around the world.
This commitment ensures Oman LNG will maintain its strong position in the global LNG market and contribute to global energy security, delivering clean and reliable energy.
Hamed Al Nu’amani, CEO of Oman LNG, said: “We are delighted to sign this term-sheet agreement with Shell, who has been our partner in the industry for many years. This agreement leverages the opportunities to place Oman LNG in a very competitive market, with strong partners allowing us to grow our market access.”
Further, OQ and Shell International signed a Partnership Agreement for Developing Green Hydrogen in Oman after acquiring a 35% shareholding interest in Green Energy Oman (GEO) project.
The project is expected to be developed in multiple phases to produce at full capacity, around 1.8 million tonnes of green hydrogen.
This agreement was signed by Najla Zuhair Al Jamali, CEO of Alternative Energy at OQ and Walid Hadi, Senior Vice President and Country Chair of Shell Oman.
On this occasion, Najla Zuhair Al Jamali, CEO of Alternative Energy at OQ, said: “The entry of Shell to this vital project constitutes a qualitative step that will enable the consortium to benefit from their advanced global expertise in this field. This will surely contribute to achieving the desired objectives of the project. Shell is a pioneering company in the alternative energy sector and entertains great technical and practical experience that would directly help in developing all phases of the project.
Al Jamali explained that the GEO Project is one of the best specialized projects that seek to provide the necessary green energy sources to meet the increasing global demand on carbon-free fuel.
On his turn Walid Hadi said, “We are pleased to sign these important agreements that will strengthen our partnership with the Sultanate of Oman. This will be Shell’s first long-term LNG offtake from Oman and the agreement supports continued production from Oman LNG into the 2030s. We’re proud of the contribution we have made to the success of the venture to date and pleased to be deepening our relationship.”
He added: “With our entry to the Green Energy Oman (GEO) consortium, we are taking a further step to advance lower and zero emissions energy projects in Oman. The project remains in its early phase, but this is a sign of the potential we see for Oman through the energy transition. We also look forward to working together with the Ministry of Energy and Minerals to explore the sustainable development of the first integrated Liquefied Synthetic Gas (LSG) value chain.”
