In Big Oil's Back Yard, a Solar Plant Starts Powering Industry

(Bloomberg) --

Petroleum Development Oman, in which Royal Dutch Shell Plc and Total SA hold minority stakes, has begun receiving power from the Gulf Arab country's largest photovoltaic solar plant.

The 100-megawatt Amin facility, built partly by Marubeni Corp., will supply electricity for PDO's operations, the state-run company said Sunday in a statement. PDO targets producing 30% of its electricity from renewable resources by 2025, Mohamed Al Busaidi, who heads its renewables business, said by phone.

Oman, like neighboring Saudi Arabia and the United Arab Emirates, is expanding into solar energy to diversify its domestic sources of electricity. The nation is the largest Arab oil producer outside of the Organization of Petroleum Exporting Countries.

READ: Mideast Petro-States Look Past Oil Rout to Chase Solar Power

Amin was built at Nimr in southern Oman by a group including Marubeni, Oman Gas Co., Bahwan Renewable Energy Co. and Nebras Power, PDO said.

PDO is developing a much bigger solar plant that will generate power from the sun's heat, as opposed to photovoltaic units like Amin that produce electricity directly from sunlight. The Miraah thermal project was originally planned to reach a capacity of more than 1,000 megawatts.

Another photovoltaic plant is under construction at Ibri, west of the capital Muscat, which will produce power for the national grid. The Ibri project's first phase, for 500 megawatts, is scheduled for completion by 2021, according to Oman Power & Water Procurement Co., the country's sole bulk buyer of electricity.

Oman's push into renewables encountered a setback when U.S.-based Glasspoint Solar, which was building the Miraah thermal project, went into liquidation earlier this month. PDO said Sunday that it's able to operate the facilities without Glasspoint, adding that Miraah units using the U.S. firm's technology will soon be commissioned and have a capacity of 300 megawatts starting in July.

PDO, Oman's largest oil producer, is 60%-owned by the government. Shell holds 34% of the venture, while Total owns 4% and Partex Oil & Gas has the remaining 2%, according to PDO's website.