A US-Saudi consortium, Mera Oil, said on Wednesday it is in the final stages of selecting a location for a new $5bn "integrated refinery and export corridor" that would provide an outlet for Mideast Gulf crude and oil product in the event of future disruption through the strait of Hormuz.
The announcement comes as several Mideast Gulf countries consider multi-billion-dollar investments in pipelines and port infrastructure to re-route crude and oil products around the strait, which has become the focal point of the US-Iran war, and through which oil flows have been heavily disrupted.
The Mera Oil project will comprise a 200,000 b/d integrated refinery linked to deepwater port infrastructure, large scale storage facilities for crude and products, and marine export facilities. Mera Oil brings together Texas-based energy development firm MWG Enterprises, the US-based Patel Family office, which built its wealth in hospitality, and PWS, an associate company of Saudi industrial group AHQ. Initially, funding will be sourced from outside investment and debt, Mera said.
The consortium has narrowed its site selection process to three locations outside the strait of Hormuz, it said, and it expects to confirm a site before the end of this year.
A candidate location will need to meet the project's "route resilience, infrastructure and development timetable requirements," Mera Oil said, without going into specifics.
The refinery's product slate will be focused on high-specification middle distillates, Mera Oil said, including ultra-low sulphur diesel and jet fuel, for selected US, Atlantic basin, Mideast Gulf and other international markets.
Mera said that when a location is selected, the project should move into final site diligence and engineering design, with mechanical completion of phase one of the project due in 2029. This would be followed by commissioning and commercial operations.
