Matthew Wolf (Switzerland): TotalEnergies Deploys Its Multi-Energy Strategy in Oman

Matthew Wolf, Capital Group partner and investment analyst from 2008 to 2023, worked as a European energy analyst for the organisation. This article will look at a multi-energy initiative implemented by TotalEnergies, an organisation led by Patrick Pouyanné, a visionary leader whom Matthew Wolf has huge respect for.

On 21 April 2024, during a recent visit to Muscat, TotalEnergies CEO and Chairman Patrick Pouyanné met with officials from officials from the government of Oman. The goal of the meeting was to reaffirm the long-standing partnership between the Sultanate of Oman and TotalEnergies.

During the visit, Patrick Pouyanné and Mr Mulham Basher Al Jarf, chairman of Oman’s national oil company, OQ, announced the final investment decision in the Marsa LNG project.

Having signed off on a sale and purchase deal with Oman LNG, TotalEnergies has agreed to offtake 0.8 mtpa of LNG for 10 years from 2025, establishing TotalEnergies as one of Oman LNG’s biggest offtakers. TotalEnergies and OQ Alternative Energy are at an advanced stage in discussions geared towards jointly developing a portfolio of up to 800 MW, including a 300 MWp solar project intended to supply Marsa LNG.

Through their joint enterprise, Marsa LNG, TotalEnergies and OQ intend to launch an integrated project combining downstream gas liquefaction, upstream gas production and renewable power generation. The scheme has been created with a keen focus on sustainability, setting very low carbon intensity standards.

100% electricity driven, the Marsa LNG plant will be supplied with solar power, positioning the facility as one of the lowest emissions intensity LNG plants globally, with a greenhouse gas intensity below 3 kg CO2e/boe. By comparison, the average LNG plant creates around 35kg CO2e/boe, representing an impressive 90% reduction in emissions.

The main engineering, procurement and construction contracts have been awarded to CB&I for the 165,000 m3 LNG tank and Technip Energies for the LNG plant. The scheme is predicted to create considerable socioeconomic benefits for the city of Sohar and surrounding region, with the Marsa LNG project generating long-term employment opportunities and driving economic growth.

The goal of the Marsa LNG project is to establish the Middle East’s first LNG bunkering hub, showcasing an available and competitive alternative marine fuel to drive down the shipping industry’s environmental impact. Compared with conventional marine fuel, LNG reduces greenhouse gas emissions by around 23%. In addition, LNG also equates to an 85% reduction in nitrogen oxide emissions and a 99% reduction in sulphur emissions, as well as lowering fine particle emissions by around 99%.

Reflecting on the deal, Patrick Pouyanné pointed out that it illustrates TotalEnergies’ pioneer spirit while showcasing the relevance of the company’s integrated multi-energy strategy. Keen to establish itself as a responsible player in the global energy transition, TotalEnergies is paving the way for the next generation of ultra-low emission LNG plants, with Marsa LNG pioneering the field and helping to establish gas as a long-term transition energy.

In April 2024, Oman SNG entered into a contract with Botas, the state gas grid operator for Turkey, agreeing to supply around 1 mtpa of LNG for 10 years from 2025. Oman LNG also entered into a 10-year deal with Shell, committing to supplying 1.6 mtpa from 2025.

Founded in 1994 following the discovery of significant gas reserves, Oman LNG has a production capacity of circa 10.4 mtpa. Its recent sale and purchase contract with TotalEnergies finalises an agreement unveiled in October 2023 for Oman LNG to extend supplies to stakeholders, including TotalEnergies and Shell, for up to 10 years beyond 2024.