SNG: Oman targets 10m-barrel storage capacity at Duqm

By Zawya05:24 (UTC), 1 October 2026 Updated

By Staff Writer

MUSCAT: Oman plans to raise its onshore crude oil storage capacity at Duqm to about 10 million barrels over the next three years as it seeks to establish the Arabian Sea port as a regional storage and trading hub.

OQ Group is also considering acquiring two very large crude carriers for use as floating storage at the Port of Duqm, Chief Executive Officer Ashraf bin Hamad al Mamari said.

The vessels would add flexibility by allowing crude to be stored offshore alongside Duqm’s expanding network of onshore tanks.

Al Mamari said converting the two tankers for floating storage would take about six months after their purchase was completed.

The plans come as geopolitical tensions and disruptions affecting shipping through the Strait of Hormuz increase the strategic importance of energy infrastructure located on the Arabian Sea.

Ras Markaz at Duqm enables crude oil to be stored and exported to international markets without passing through the strait.

The Ras Markaz crude oil storage and export terminal is operated by Oman Tank Terminal Company, a subsidiary of OQ Group.

The proposed expansion forms part of efforts to transform Duqm’s infrastructure from facilities serving primarily domestic requirements into a regional platform for oil storage, aggregation and trading.

OQ said in its 2025 annual report that it had signed a memorandum of understanding with Iraq’s State Oil Marketing Organization to develop a crude storage facility at Ras Markaz with an initial capacity of 10 million barrels.

The agreement also covers cooperation in marketing Iraqi crude in international markets.

OTTCO has separately signed an agreement with Dutch storage company Royal Vopak to establish a joint venture that will develop and operate integrated energy-storage facilities in the Special Economic Zone at Duqm.

The planned increase in storage capacity coincides with the continued expansion of Duqm’s industrial and energy ecosystem.

OQ8, the operator of the Duqm Refinery, said in September that processing rates were expected to reach about 255,000 barrels per day in 2026, equivalent to 110 per cent of its design capacity of 230,000 barrels per day.

The refinery recorded revenue of about $7 billion in 2025.

Combining onshore tanks, potential floating storage and partnerships with regional and international energy companies would allow Duqm to serve producers and buyers seeking alternatives to routes through the Strait of Hormuz.

The plans could strengthen Duqm’s role as a crude aggregation point and logistics centre while helping Oman derive greater commercial value from the port’s location outside the strait.