Oman's Duqm refinery is considering expanding its nameplate capacity by a further 10pc from 255,000 b/d and is also looking to upgrade its naphtha output for use in gasoline production, according to its operator.
The refinery has already surpassed 110pc of the initial 230,000 b/d nameplate capacity without requiring any additional investment, Omani-Kuwaiti joint venture OQ8's chief executive Abdullah Al Ajmi told Argus.
The firm is evaluating whether the target can be pushed to 120pc, but this will ultimately depend on the economics, he added. The $9bn Duqm refinery reached full capacity in early 2024, following its startup in mid-2023, and has since increased its nameplate capacity by 10pc from 230,000 b/d to 255,000 b/d.
In addition to boosting capacity, Duqm is also exploring ways to extract more value from existing lower-margin products. "We need to go to the bottom of the barrel. The goal is to fully utilise all our product streams, target products that are seen as less attractive, and look for ways to upgrade them," Al Ajmi said, citing naphtha as an example.
Several major Asian petrochemical crackers — including in South Korea, the largest destination for Duqm's naphtha exports — are scheduled for planned maintenance starting in October. Some of the country's operators have also agreed to cut overall capacity, which could weigh down regional demand.
Global petrochemical demand is not attractive because supplies have continued to outpace demand, Al Ajmi said, adding that there are discussions to upgrade naphtha for use in reformate or gasoline production. The refinery is also looking to "optimise the product slate by increasing output of middle distillates while deprioritising lighter products such as LPG and naphtha", although no plans have been confirmed.
The refinery exported a total of 295,000 b/d of products in August, marking the highest volumes shipped on a monthly basis — over half of which were middle distillates, data from global trade analytics platform Kpler show. The refinery produces at least 130,000 b/d of diesel, 61,000 b/d of naphtha, 22,000 b/d of jet fuel, and 15,000 b/d of LPG at full capacity.
Diversifying crude
The refinery is also currently evaluating several third-party crudes as it looks to broaden its feedstock beyond Kuwaiti and Omani grades. It has processed nearly 11 different types of feedstocks so far, including blending crude with lighter grades or other affordable options like Basra crude, Al Ajmi said.
Duqm previously imported Iraqi Basrah Heavy crude and West African crude earlier this year, in addition to processing various other crude grades, before which the feedstock was made up of 65pc Kuwaiti crude and 35pc Omani crude.
"While the advantage can sometimes be marginal, using different crude types or specifications is generally beneficial," Al Ajmi said. Duqm has previously turned to heavier grades to boost middle distillate yields and reduce the output of lighter products, he added.
