Oman Oil Company S.A.O.C. (OOC) announced Monday a principle agreement for the sale of a 20% interest in Oman Polypropylene LLC (OPP) to Gulf Investment Corporation (GIC). The joint venture is between OOC and LG International of Korea on 80%: 20% basis respectively. The share of GIC will be carved out from OOC’s 80% ownership in the Company.
“The addition of GIC as an investor in OPP further enhances the company’s shareholding,” said Maqbool Ali Sultan, Oman's Minister of Commerce & Industry and OOC’s Chairman. “GIC’s investment in OPP is in line with one of OOC’s objectives by facilitating foreign investment in the Sultanate,” he added.
OPP was established to construct and operate a polypropylene plant in Sohar Industrial Area with a capacity to produce 340,000 tonnes per annum of polypropylene product. The project, which is started as part of Sohar refinery complex, aims to add value to the “propylene” stream to produce a product that can be used in a large array of downstream industries.
Commenting on its investment in OPP, Hisham Al Razzuqi, the Chief Executive Officer of GIC said, “We are very pleased to be partners with Oman Oil Company in this important project. We are optimistic of OPP future and we will continue to seek feasible investment opportunities that add value to Oman’s economy, and therefore enhance growth prospects.” He added that, “The establishment of Oman Investment Company (OIC) between GIC and the Oman government is a clear indication that GIC is committed to expand its presence in the Omani economy that has growing and rewarding opportunities. This fits perfectly with our mandate to support the development of private enterprise and economic growth in the GCC region.”
Recently OPP secured US$ 219 million loan from local, regional, and international banks at attractive prices. The plant is being constructed on EPC basis by a consortium of LG International Cooperation and LG Engineering & Construction Corporation. The plant is expected to employ 150 people at operation. The Project total cost is around US$ 313 million.
Oman Polypropylene will market production in the Indian subcontinent, Iran, Middle East and east and southern Africa and LG International will be the marketer in the rest of international markets. Ninety per cent of the production will be exported and the remaining 10 per cent will meet local existing and future requirements.
The plant will commence commercial production in the last quarter of 2006. (menareport.com)
© 2004 Mena Report (www.menareport.com )