Oman sent out its first shipment of liquefied natural gas (LNG) on Thursday with South Korea as its first customer, in an important step by the sultanate to reduce dependence on oil revenues.
The cargo of 135,000 cubic meters (4.725 million cubic feet), destined for the Korea Gas Corporation (Kogas), was loaded at the Gulf port of Qalhat, south of the Omani capital of Muscat, an AFP correspondent there said.
Oman's Oil Minister Mohammad bin Hamad al-Romhi was among top officials who attended a sendoff ceremony at the LNG factory at Qalhat, which started production last December.
Romhi told AFP that the factory was "the most important investment project in Oman within a strategic plan aimed at diversifying sources of revenues and cutting down on dependence on oil."
The minister added that the government had guaranteed the sale of all Qalhat's production capacity, put at 6.6 million tons a year. The total cost of the project was some 2.6 billion dollars.
Economy Minister Ahmed bin Abdel Nabi Meki told AFP the project would generate close to 500 million dollars in the year 2000 through exports of 2.2 million tons of LNG and some 50,000 barrels of natural gas liquids a day.
Oman LNG signed a sales and purchase agreement (SPA) with Kogas in October 1996 to supply 4.1 million tons per annum for 25 years starting in year 2000.
According to Omani media, it is the biggest contract signed between a LNG provider and a single client.
SPAs have also been signed with Osaka Gas of Japan, Dabhol Power Company in India, Coral Energy Resources of the United States, and France's Total, which after mergers is now known as TotalFina Elf.
The government owns 51 percent of Oman LNG, the Anglo-Dutch giant Royal Dutch Shell holds 30 percent, TotalFina 5.54 percent, Korea LNG five percent, Partex of Portugal two percent, and Japan's Mitsui, Mitsubishi and Itochu own the rest - MUSCAT (AFP)
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