MUSCAT — E.ON, one of the world’s biggest gas and power companies, is keenly exploring investment and business opportunities in the Sultanate. A team of top executives led by the boss of the Düsseldorf, Germany-headquartered international energy conglomerate was in Muscat late last week for discussions focusing on a number of energy-related areas, spanning LNG processing and supply, gas exploration and production, natural gas and coal-fired power generation, and renewable energy development.The visit headed by Dr Wulf H Bernotat, Chairman of the Board of Management and CEO of E.ON AG, further underscores Oman’s growing international appeal as an investment destination. E.ON is by far the largest privately owned utility company in the world, generating annual sales of just under EUR 87 billion in 2008. With operations in more than 30 countries, the company boasts a global workforce of roughly 93,500 employees. Its business interests span the spectrum of the energy chain, encompassing gas exploration, production, transportation, storage and distribution; LNG supply; natural gas, coal, nuclear and hydro power generation; power transmission, distribution and retail sales; and renewables and carbon sourcing.Speaking exclusively to the Observer, Dr Bernotat said his three-day visit was aimed at assessing opportunities for business and investment in areas linked primarily to the company’s core power and gas business. Talks with high-ranking government officials focused on, among other areas, prospects for sourcing liquefied natural gas (LNG) from the Sultanate, as well as potential partnership opportunities in LNG processing schemes. “We are trying to establish opportunities to buy LNG from Oman on a spot or medium term basis.We are also interested in principle in getting involved in LNG schemes in general, as a partner in LNG projects. In this regard, we are talking not only to Oman, but also Qatar in particular,” E.ON’s Chairman and CEO said. “Secondly, we are also gas producers ourselves, and therefore we are interested in the upstream E&P (Exploration and Production) business. We understand there are some opportunities here in Oman with regard to licences that have not yet been awarded for acreage to be explored.”Power generation is another key area of potential investment interest for E.ON, Dr Bernotat said. The energy utility is weighing opportunities linked to the expansion of existing power projects, notably the Ghubrah Power and Water Project, which is proposed to be revamped and modernised. Likewise, it has set its sights on Oman’s first coal-fired power and water project — a 1,000 megawatt plant planned at Duqm on the Sultanate’s Wusta coast. “(Duqm) is a new project where we could also get involved as developer and operator of the plant, since we have quite a number of coal-fired stations under operation, as well as four huge ones under construction in Russia, Germany, Holland and the United States.We are very experienced in building and operating especially coal-fired plants, but also gas fired plants. We have around 80 power stations around the world that we operate, so there is a very broad base on which we have expertise,” Dr Bernotat said. In talks with Omani officials, the CEO said he had also highlighted E.ON’s considerable process in the field of coal-fired power generation and the modern technologies being developed to make such projects environmentally friendly. “We talked about carbon capture and storage (CCS) technology — the process of extracting CO2 from the emission stream and storing it in reservoirs — as an attractive option. We are involved in seven different projects to test the technology — and it could be something interesting for Oman to join in the development of this modern technology.”Duqm, Dr Bernotat says, has all the key ingredients that would allow for the successful development of a coal-fired power project. “You have a location that can receive large seagoing ships that import coal, say, from South Africa, Indonesia or Australia. Because you have reservoirs, you have the potential to store CO2. This means you have all the economics principally in place.” Another area of interest for E.ON is renewables. “We talked about renewables in the form of wind power potentially, and solar power in two different forms: photovoltaic – which is the direct conversion of sunshine into electricity; and Concentrated Solar Power (CSP) which involves the use of mirrors to reflect the energy of the sun on to a heat exchanger to produce steam that runs a turbine.”Oman is actively looking at renewables, chiefly solar and wind energy, to help meet the country’s growing energy needs. In addition to a number of small, pilot schemes planned in the rural areas, a large-scale solar energy project is also envisaged over the next few years. Significantly, any eventual investment by E.ON in the Sultanate will be the energy giant’s first in the wider Gulf region. “Oman has been described, first of all, as a well-organised country and a very attractive country to invest – much more than many countries in which we have invested at the moment. From that point of view, it’s a good country to consider for investment,” Dr Bernotat noted.E.ON highlights:74 Gigawatts of installed power generation capacity33,000 km of power transmission lines1 million km of distribution lines10 billion cubic metres (bcm) of equity gas production11,600km of gas transmission lines9.2 bcm of gas storage capacity30m power and gas customersSales of EUR87 billion in 2008Operations in over 30 countries
By Conrad Prabhu
© Oman Daily Observer 2009
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