Vienna — Oman plans to still go ahead with a giant $1.5 billion natural gaspipeline linking the sultanate with Iran despite the threat of US sanctionsimposed on the Islamic republic, according to the Gulf Arab state's oilminister.
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Agreed in 2013, the subsea pipeline will deliver 1 Bcf/d of gas to Omanpotentially for processing into LNG and also for domestic consumption.
"We are still going ahead," said Mohammed al-Rumhy, speaking ahead ofOPEC's formal meetings on Friday. "Formally, we are still waiting for thedetail of the sanctions. On paper we're sending the tender documents tocompanies interested all over the world."
US sanctions targeting Iran's energy sector are due to come into force inNovember but are expected to focus on its oil industry. Oman's ongoingcommitment to its gas link with Iran is in contrast with other potentialpartners.
France's Total said in May it would unwind all its operations in relationto Iran ahead of November 4. The company had signed a $2 billion deal todevelop some of Iran's giant South Pars natural gas field.
Oman needs the gas to meet rising demand and to augment supplies fromQatar delivered through the cross-border Dolphin pipeline, which runsthrough the United Arab Emirates. Consumption in the sultanate more thandoubled in the decade leading up to 2016, according to the EnergyInformation Administration.
The country also exports significant volumes via its LNG plants at Qalhatbut has increasingly had to divert supplies to meet domestic demand.
Oman is allied to OPEC despite being outside the 14-member group. Theminister also said the country has capacity to pump 1 million b/d ofcrude and could increase output within weeks if required.
Despite planning to go ahead with the Iranian gas pipeline line, Al-Rumhysaid the state requires more information on the details of US sanctions.
"In fairness we are concerned," he added. --Staff, email@example.com
--Edited by James Leech, firstname.lastname@example.org