Revenues at Oman LNG, the operator of the country’s sole LNG export plant in Qalhat, increased 14 percent to $2.19 billion in 2017.
This is the first time in four years that Oman LNG reported a rise in its yearly revenue when compared to the year before.
The increase was partly attributed to additional feed gas arriving from BP Khazzan development in central Oman.
The collapse of oil and gas prices affected the LNG producers’ revenues and profits for years.
Oman LNG’s revenue slid from $4.49 billion in 2013 to $4.07 billion in 2014 and $2.61 billion in 2015, reaching its lowest point in 2016 of $1.93 billion.
However, despite the slight increase in oil prices compared to the year before, 2017 was “a challenging year for the industry whereby both the company’s revenue and net income after tax (NIAT) were impacted,” Oman LNG said in its annual report.
Net income after tax stood at $642 million, compared to $566 million in 2016.
Oman LNG produced 8.6 million tonnes of the chilled fuel last year, against a production of 8.5 million tonnes in 2016.
The company’s LNG terminal in Qalhat near Sur has a capacity of 10.4 million tonnes per year.
According to the annual report, 134 cargoes were loaded from the plant in Sur: 88 for Oman LNG, 4 of which were spot cargoes, and 46 on behalf of Qalhat LNG.
Oman LNG noted in the report that due to “a significant unplanned advance payment” for feed gas amounting to $230 million as of 31st December 2017, the company expected to take a short-term overdraft facility during the year to cover for any cash shortfall.
“However, through rigorous cash management, this was avoided, resulting in a significant saving in interest cost,” it said.
The company added that due to new feed gas arriving from the giant Khazzan field, the Sur plant’s three trains were now operating at almost full capacity.
“With rising domestic demand squeezing export revenue in recent years, we are now well on our way to recovering a healthier export-domestic allocation balance. If and when the
market strengthens, we will be well placed to extract more revenue from exports without slowing growth at home,” the company said.
Oman LNG is a joint venture company established by a Royal Decree in 1994. The company is owned by the government of Oman that has a 51 percent stake.
The Hague-based LNG giant Shell holds a 30 percent stake in Oman LNG.
France’s Total has a 5.54 percent stake, while Japan’s Mitsubishi Corp. and Mitsui & Co have 2.77 percent stake each. Korea LNG owns a 5 percent stake in Oman LNG, Partex (Oman) Corp a 2 percent stake and Itochu Corporation of Japan has a 0.92 percent stake in the LNG producer.
LNG World News Staff