Majority government-owned Oman LNG, which operates a three-train natural gas liquefaction plant at Sur, has announced revenues of $2.612bn for 2015, down from the previous year’s figure of $4.074bn – a decline attributed primarily to low oil and gas prices, as well as a shortfall in LNG production.
The slump in revenues was the steepest in the last five years, reflective of the negative impact of the oil price decline.
It compares with record high revenues of $4.491bn achieved in 2013, up from $4.342bn in 2012, and $3.963bn in 2011.
Net income after tax (NIAT) also plummeted to $965mn in 2015, down from $1.768bn a year earlier, the company said in its 2015 Annual Report.
Oman’s oil minister Dr. Mohammed bin Hamed al Rumhy, who is also chairman of the Board of Directors of Oman LNG, said: “We enter 2016 with oil and gas prices still languishing at values more than two thirds below their mid-2014 high. To say that this does not present challenges to our company would be to deny the undeniable.”
“The company has shown wisdom in responding to this challenge; as we have had to initiate some serious cost optimisation and take measures to create more efficiencies in all areas of our business,” Ruhmy said.
LNG production slumped to 7.91mn tonnes in 2015 – the lowest since 2011 – as natural gas was diverted by the government primarily to meet burgeoning demand from the power generation and water desalination.
This has led to the underutilisation of Oman LNG’s capacity by 2.49mn tonnes per annum (mtpa) last year, equating to around 15% of the integrated 3-train plant’s total capacity of 10.4mtpa.
However, to help offset part of the impact of market volatility on its revenue objectives, Oman LNG resorted to cargo swaps and diversions to optimise earnings — a strategy that has been aided by Oman LNG ‘s integration with sister firm Qalhat LNG in 2013, the CEO noted.
A total of 126 cargoes (83 from Oman LNG and 43 from Qalhat LNG) were loaded from the integrated Sur plant in 2015.
Meanwhile, production of natural gas liquids (NGL) – a byproduct of gas liquefaction – also suffered its biggest fall in five years to 241,185 metric tonnes last year, down from 145,711 metric tonnes in 2014.
NGLs are typically lifted by state-owned Oman Oil Refineries and Petroleum Industries Company (Orpic) for processing into fuel and other refined petroleum products.
