Petroleum Development Oman is pushing for solar and wind energy to meet the target of 30 per cent energy capacity based on renewables by 2025, says Aiman Al Shukaili, Head – Renewable Energy, PDO, in a conversation with Akshay Bhatnagar.

Below are excerpts from the interview:

Aiman Al Shukaili, Head – Renewable Energy, PDO

What’s PDO’s strategy on renewable energy?

At PDO, we are always looking at new market trends and emerging technologies that could help us achieve our goals more effectively and enable us to be ahead of the curve. Renewable energy has been our focus area for many years. To further strengthen our foray in this, we set-up the renewable energy team back in 2018.

Based on our assessment of our energy needs, we have set a target that 30 per cent of our energy capacity will be met through renewables by 2025. This is a medium-term target. This target has been set based on our expected energy demand and the availability of land, resources and grid in our concession areas. We are fully confident that we could meet our desired medium target.

In the long term, we do have our own master plans but it is too premature to talk about them at this stage. Their implementation will depend a lot on a number of external factors such as the possible shifts in the technology, and the direction and pace of the energy transition globally.

We want to ensure that whatever standards, technology we are pushing, they should be the latest. We are collaborating and sharing the learnings with the relevant industry stakeholders including the Ministry of Energy & Minerals, Nama Group, our shareholders and industry players to support the development of renewable energy in Oman.

How much of your current energy needs are met through renewable energy?

PDO’s overall power generation capacity is around 1.5- 1.6GW. Currently, 9-10 per cent of our requirement is met through solar energy, mainly from the utility-scale IPP project at Amin with 100MW capacity apart from a number of smaller solar projects.

Talking of solar energy, tell us about your key projects in this segment.

In solar energy, we have been the market leader in Oman. Our first major initiative was Miraah, the concentrated solar power (CSP) project. The 300MW solar thermal facility produces steam for usage in enhanced oil recovery (EOR) to extract heavy and viscous oil at the Amal oilfield, located in South Oman.

When it comes to the power, we set up the first Solar Independent Power Project (IPP) in Oman – 100MW Amin Photovoltaic Power Plant. Located near Nimr, Amin is providing power to our interior operations as one of the world’s first utility-scale solar projects to have an oil and gas company as the sole buyer of electricity.

The plant is based to develop, finance, build, operate and maintain a model that attracted highly reputed global developers in the renewable energy industry. It is a testimony to the strong equity of PDO and investors’ confidence in Oman. The installation was built and commissioned in a record time, just under 12 months after signing the EPC (Engineering, Procurement and Construction) contract, providing initial power into PDO’s electrical grid in March 2020, two months ahead of the schedule.

I must mention that in the plant we have used bifacial photovoltaic modules, the latest proven technology in the PV industry, and backtracking facilities to maximise energy production over time. When we were opening the tender, the technology was not so much mature. It was just released and only a few small projects were executed based on it. But we opted for it and it has proven to be quite beneficial to us. It helped the developer to make the tariffs far more competitive compared to other popular technologies. The peak output often seen in any solar plant is up to three to four hours but at Amin, we could see this going up to eight hours also. In fact, the similar technology is now going to be used by Oman Power and Water Procurement Company (OPWP) and Shams Al-Dhahirah Generating Company in their Ibri-II 500MW IPP, Oman’s largest utility-scale solar PV Independent Power Project.

We have also undertaken a number of smaller solar energy projects. The most notable among them is the solar car park project. This was undertaken even before we went ahead with Amin project. In the first phase of 6MW, thousands of solar panels were installed in car parks at Mina Al Fahal to provide power for PDO’s office buildings.

The PV modules were installed on the canopies of over 2,000 parking lots. It requires minimum effort to operate and maintain at negligible operating costs for a projected 25-year life cycle!

The first phase of the solar car park was a huge learning curve for us. We partnered with international contractors as it was our first project in this field. We learned a lot from this project.

In the second phase, we localized almost everything as part of our In-Country Value (ICV) efforts. It’s not easy to localize when it comes to the solar panels, but we made the solar structures in Oman, engineering was done in Oman by Omani consultants, the construction was done by Omani companies, the supervision was done by Omani SMEs.

Also, project management unlike the first phase was done by PDO itself. We have expanded the capacity by another 3MW in the last quarter of 2020.

To expand our project further, we have also awarded the construction scope for an additional 1MW facility with a tracking system in Mina Al Fahal. Again, the engineering and procurement contract has been awarded to an Omani SME, the construction to one of our Local Community Contractor (LCC).

Our team on renewable energy is gaining a lot of knowledge from these projects’ execution and operations. The learnings are helping our highly qualified professionals to manage the assets more efficiently and plan for the future more effectively.

Apart from the previously mentioned projects of industrial scale, we also have undertaken solar energy projects for the domestic segment in our Ras Al Hamra development project. In 2019, we commissioned 10 villas with the solar panels system with 10kW capacity there. The project was executed by Omani SMEs. The project has been quite successful. Now, we are considering installing the solar systems in 580 low rise buildings in the next phase.

Are you looking at undertaking more projects in solar energy?

Buoyed by the success of Amin PV project, we are looking at undertaking another solar IPP project in the future. In the solar CSP also, we are exploring different opportunities there. We may go for the development of CSP molten salt or follow the technology used in Miraah project. It all depends on the findings through our pre-feasibility and feasibility studies.

When it comes to battery storage, we are closely watching the market and talking to global leaders. My personal opinion is that in the next couple of years, we would see a shift when it comes to the cost of the battery storage and that would be the time we might be pushing further into that sphere.

Are you exploring options in wind energy too?

Absolutely, wind is very much an integral part of our renewable energy plans. I firmly believe that Oman can set a Center of Excellence when it comes to the wind energy. Not many countries in the region would be blessed with the resources we have in Oman and the diverse geography when it comes to the wind aspect.

PDO started the wind measurement campaign in March 2020. We have installed the weather stations in six locations. The data gathered from various locations in the last 9 months has been very promising. We are noticing average wind speeds ranging from 8 to even 11 metres per second which are quite promising from the feasibility perspective. We are also in direct contact with the relevant manufacturers who are quite interested in the Omani market.

We are in touch with Tanweer, the partner of Masdar in the setting-up and running of 50MW wind farm in Dhofar. Our wind measurement campaign is expected to finish in the first quarter of 2021 and based on the final findings, we could move to the development planning. We aim to start awarding the wind projects this year. Our first wind project could be in the range of 80- 100MW.

Are you considering solar and wind hybrids?

Yes, hybrids could be at the grid-scale as solar will be peaking during the daytime because it’s without storage while the wind would be peaking during the night. And we could see that that kind of complimentary setup from our initial assessment.

What about your expected foray in green hydrogen?

In green hydrogen, we have already started our feasibility studies. Our new technology team is looking into where PDO can benefit when it comes to the green hydrogen into our processes.

Some of the possibilities include the use of solar hydrogen in our rigs to replace diesel generators, its production via water electrolysis using surplus electricity, hydrogen injection into gas pipelines and the commercialization of a hydrogen feed to a local off-taker. In addition, we are collaborating and exchanging information with the Ministry of Energy & Minerals and other large companies in Oman on the subject.

Green hydrogen, many call it a new oil, is comparatively new and the outlook on it is still shaping up globally as the related technology available is expensive, not much clarity is there on the efficiency and application areas.

In your opinion, what is going to be the impact of COVID-19 on the energy transition and PDO’s renewable energy plans?

Due to COVID-19, I think the whole world is really going to reprioritize. The energy transition is among the topmost priorities going forward. Globally, there was a slowdown in the last four years mainly due to certain geopolitical developments but I do believe that things will go back on track with the US rejoining the Paris Climate Agreement and the push for cheaper and efficient technologies.

Closer home, we have seen changes in the government’s power subsidy policies. All this augurs well for the adoption of renewable energy and makes solar and wind energies a more compelling proposition.

From PDO’s perspective, our renewable-energy plans are on track as planned. There could be some minor delays in some cases mainly due to logistics related challenges. All our renewable energy projects are intact, all of them are moving forward.

Oman, under the leadership of His Majesty Sultan Haitham bin Tarik, is embarking on a sustainability development path driven by technology and innovation as per the Vision 2040. PDO is fully aligned with Oman’s renewable energy vision and perfectly placed to support the Sultanate’s march ahead.