Musandam Power Company (MPC), a majority-owned subsidiary of the Oman Oil Company (OOC), has signed long-term power purchase deal with Oman Power and Water Procurement Company, and a Natural Gas Sales Agreement with the Ministry of Oil and Gas to supply and sell natural gas to MPC, according to a report.

 

MPC has also signed project financing agreements and achieved financial close with Bank Muscat, said the Oman Daily Observer report.

 

MPC is developing a new dual fuel Independent Power Plant (the Musandam IPP) in Tibat — Wilayat Bukha at the Governorate of Musandam with a capacity of 120MW, it said.

 

The selected dual fuel Reciprocating Engines (RE) configuration for the Musandam IPP following a competitive pre-qualification and tendering process to deliver flexible, lowest life cycle costs and sustainable energy to the Musandam Governorate.

 

“The second phase of the project ie the issuance of notice to proceed to the EPC Contractor and construction work of the Musandam IPP started in advance of the signing of Power Purchase Agreement and project financing agreements in order to accelerate the pace of work and the establishment of the plant according to the completion schedule," Isam al Zadjali, chief executive officer of OOC, was quoted as saying.

 

"This cooperation came in light of the commitment of all concerned parties to boosting national economic growth, contribute to ICV and facilitating investments through such sustainable projects,” he said.

 

The Musandam IPP will use clean natural gas as the main fuel to maintain the stability of the local electricity supply and support sustainable development in the Musandam Governorate while significantly contributing to the Sultanate’s energy-production capabilities and long-term economic diversification plans, said the report. 

 

Storage diesel fuel will be used during emergencies as the alternate fuel on discontinuation of natural gas fuel to guarantee the electricity supply for the Musandam Governorate, it said.

 

The electricity generated from this project will be transmitted to the existing medium voltage grid through the new 132KV transmission lines being built by Rural Area Electricity Company SAOC. The generated electrically will serve the power demand of the Musandam Governorate, it said.

 

Meanwhile, MPC has signed the engineering, procurement and construction contract and long term service agreement for the Musandam IPP with Wärtsilä Muscat – an affiliate of Wärtsilä Corporation of Finland, a leader in complete lifecycle power solutions, said the report.

 

Wärtsilä Muscat will design, procure, engineer, construct, and commission the power plant as well as provide on-going maintenance and performance monitoring throughout the project’s lifecycle. The plant is expected to be commissioned by end of next year, it added.