Marafiq was established in 2013 and is Oman's first private integrated power and water utility company. Under which foundations does the company operate?
The name Marafiq means utilities and, as a centralized utility company, that suggests synergy and optimization. This in turn translates into a reduction in costs. Our current main focus is The Duqm Special Economic Zone, as the company signed a centralized utilities services agreement for 25 years with the Public Authority for Special Economic Zones and Free Zones (OPAZ). This agreement gives Marafiq the exclusive mandate to develop, own, operate and provide a full spectrum of utilities in the zone, including but not limited to, all types of industrial water, industrial gases, industrial waste management and electricity in line with applicable regulations. The company was also granted a 25-year exclusive license from the regulator for a drinking water business in Duqm, the first of its kind in Oman. Marafiq has emphasized the importance of the complementary work between the competent authorities to achieve the national strategic goals. The focus of the company is to not only serve the zone investors in Duqm, but to also provide utilities for all the OQ Group, who own 51% of Marafiq.
Duqm SEZ is one of the biggest industrial zones in the MENA region with mixed-land use. How does Marafiq deal with the different requirements?
This is a large economic zone with almost 2,000sqkm. We have residents living inside the zone area, which is challenging as their utility requirements are completely different to our industrial customers. Furthermore, in terms of industrial customers we have heavy industry, with refineries and future petrochemicals, as well as medium and light industry requirements. To satisfy all these customers, ongoing and effective engagement is a standard requirement. We are committed also to fulfilling their requirements and meeting their expectations. This is a challenge as different stakeholders have different mindsets and expectations. We continuously strive to find that happy balance at the right cost.
How the Duqm Integrated Power and Water Plant (DIPWP) will support the sustainable future of Oman?
We have been able to do this in part with our Duqm Integrated Power and Water Project. This project consists of a 326-MW gas-fired power plant and a 36,000 cubic meters per day reverse osmosis plant for water desalination. There is also a huge facility of sea water intake to serve future zone customers with supply capacity of 1.5 million cubic meters per day. Moreover, Marafiq has built an 80-km 132 KV transmission line from Duqm to Ras Markaz serving our affiliate Oman Tank Terminal Company (OTTCO), a crude oil storage facility. This is all to support the zone, which is an isolated area. We do not have access to the national grid, so we operate in island-mode. Therefore, our plant is crucial to help OQ8 (Duqm Refinery) and other energy and industrial associated projects.
Marafiq has signed a power and water purchase agreement (PWPA) with OQ8 (Duqm Refinery). How is this agreement seen from strategic perspective?
The anchor projects in the Duqm zone are OQ8 and the Marafiq Integrated Power and Water Project. Signing the PWPA with OQ8 was important for the refinery to ensure that utilities are served by a competent company. It is important as well for Marafiq to have the first customer and gain that confidence to build its reputation in the market. The PWPA has extensive technical and competency requirements and allows us to demonstrate our capability in the market.
Marafiq has signed Potable Water License with Authority for Public Services Regulation. How will this benefit the community and investors in Duqm?
Marafiq is now responsible for production, transmission and distribution, customer service, billing and collection for potable water. Since signing the agreement, Marafiq has almost tripled the water production capacity in the zone serving approximately 1300 customers, expanded storage capacity and set up a tanker filing station serving an additional 250 registered drivers. We have established a customer service office to facilitate new connection requirements and day to day customer relationship. In addition, the company is currently expanding the distribution network in the Rock Garden area, developing additional production capacity to serve Fisheries and Cement Zones, and introduction latest technology solutions for customer care. Marafiq is also developing a masterplan for provision of wastewater services. A reputed international consultant to develop the masterplan and identify priority areas for development has also been engaged. In collaboration with SEZAD, Marafiq continually monitors the demand requirement for all other utilities in the Duqm zone.
Marafiq has signed a short term power purchase agreement (PPA) with the Rural Areas Electricity Company (Tanweer). How will this agreement support the sustainability of Oman?
Marafiq is delighted to collaborate with Tanweer and partner with GE. The PPA with Tanweer will help Tanweer produce more sustainable electricity in Oman with diesel-to-gas switching through a new 'Power Plant on Wheels'. The facility will be located in the Duqm SEZ. The GE units will replace power currently generated by diesel generators in Duqm with gas which will result in significant environmental benefits. Generating 80 MW of gas-based power instead of diesel-based power is estimated to reduce annual carbon dioxide emissions by up to 90 thousand tons per year - the equivalent of taking up to 20 thousand cars off the roads.
What strategies is the company implementing to contribute to the development of human capital in the Sultanate?
Human capital is our main asset in any development in Oman. From day one, we have been focused on building our capabilities and competency. We have attracted talented Omanis to lead different functions within the company. We are currently in a process of developing an integrated talent management framework to identify the competency requirements for each job as well as develop a personal development plan for each individual within the company. In Marafiq we elevate talents and build a professional workforce that promotes the reliability and sustainability of our organization.
What are your goals and expectations for the remainder of 2021 and going into 2022?
2021 was a challenging year for everyone, with the pandemic impacting our activities. In spite of this, we received the first natural gas in the Duqm SEZ. We commissioned our Integrated Power and Water Plant which is a significant milestone for Marafiq. It is important as it means gas is now flowing into Duqm. Our focus has been to use this gas for customers. We have also completed the performance testing and commissioned a few units of the power and water plant in spite of the difficulties caused by the pandemic. In 2022, we are looking to complete all the engineering and construction activities for the power and water plant and we will be positioned to evacuate and export power and water as well as to transmit power to OTTCO to support the commissioning activities of its facilities.
What are your plans for the long term?
Marafiq is a joint venture between OQ and Gulf Energy Development, the largest private generator of electricity in Thailand. We have an optimistic expansion plan including acquiring other assets, expanding into other industrial and free zones within Oman and the ultimate goal is to launch an Initial Public Offering (IPO).