Oman Energy Situation

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23.6000° N, 58.5500° E

Total Area (km²): It includes a country's total area, including areas under inland bodies of water and some coastal waterways.


Population: It is based on the de facto definition of population, which counts all residents regardless of legal status or citizenship--except for refugees not permanently settled in the country of asylum, who are generally considered part of the population of their country of origin.

4,576,298 (2022)

Rural Population (% of total population): It refers to people living in rural areas as defined by national statistical offices. It is calculated as the difference between total population and urban population.

12 (2022)

GDP (current US$): It is the sum of gross value added by all resident producers in the economy plus any product taxes and minus any subsidies not included in the value of the products. It is calculated without making deductions for depreciation of fabricated assets or for depletion and degradation of natural resources.

114,667,360,208 (2022)

GDP Per Capita (current US$): It is gross domestic product divided by midyear population

25,056.79 (2022)

Access to Electricity (% of population): It is the percentage of population with access to electricity.

100.00 (2021)

Energy Imports Net (% of energy use): It is estimated as energy use less production, both measured in oil equivalents. A negative value indicates that the country is a net exporter. Energy use refers to use of primary energy before transformation to other end-use fuels, which is equal to indigenous production plus imports and stock changes, minus exports and fuels supplied to ships and aircraft engaged in international transport.

-206.19 (2014)

Fossil Fuel Energy Consumption (% of total): It comprises coal, oil, petroleum, and natural gas products.

99.96 (2014)

Source: World Bank


Oman is situated on the Arabian Peninsula bordering the Arabian Sea, the Gulf of Oman, and the Persian Gulf, as well as Yemen, Saudi Arabia, and United Arab Emirates. This location grants Oman access to some of the most important energy corridors in the world. Oman’s climate is dry and hot in the desert and hot and humid along the 2,092 km long coast. From May to September strong southwest summer monsoons are common.[1]

Politically, the Sultanat of Oman is a monarchy. Since 1970, after an overthrow of his father, Sultan Qabus Ibn Said has ruled the country. Along with his position as sultan, he is prime minister, defense minister, finance minister, foreign affairs minister and chair of the central bank. As the chief lawmaker, he approves all laws and treaties and adopt them in the form of "Royal Decrees". Moreover, the Sultan appoints and dismisses the members of the government.[2] In 1996, the Sultan issued a royal decree which is basically considered as the basic law. The current bicameral legislature also results from this royal degree. It consists of an upper chamber with advisory power, the State Council (Majlis al-Dawla) having 75 member appointed by the sultan, and the lower chamber, the Consultative Council (Majlis al-Shura), which had replaced the State Consultative Council (SCC) in 1991. The SCC in turn has been established in 1981 as an appointed body that had solely an informal role. Generally, Sultan Qaboos is know for his politics of a careful and gradual development and modernization.[3]

Economically, Oman depends on oil resources. Due to a decline of oil resources, the country increasingly seeks to diversify, industrialize and privatize the economy. In Oman's 8th five-year plan (2011 – 2015), the government puts a special emphasis on the economic diversification, the creation of jobs for Omanis, the encouragement of foreign investment and an expansion of the private sector’s role as the key components of the move toward a post-oil economy.[3]

Oman's export products are petroleum, reexports, fish, metals, and textiles. In 2012, the country's main export partners were China (31.9%), Japan (12.9%), United Arab Emirates (10.1%), South Korea (10%), Thailand (4.4%), and Singapore (4.4%). Oman imports mainly machinery and transport equipment, manufactured goods, food, livestock and lubricants. In 2012, products are primarily imported by the United Arab Emirates (23.6%), Japan (12.6%), India (8.5%), China (6.4%), and the US (6.1%).[4]

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Energy Situation

According to the data of the International Energy Agency mentioned above, Oman has not installed any noteworthy capacities based on renewable energy. Solar energy is only used for water heating systems for tanks located on the roofs of private houses. Additionally, solar energy is used by the oil production industry. On the one hand it is used to power small equipment which is located in remote areas. On the other hand, solar energy is important for the steam production to extract oil from oil fields in the desert.[5]

According to the Annual Report of 2012 of the Authority for Electricity Regulation, Oman seeks to diversify the electricity generation and to reduce the current dependency on diesel and gas. In 2012, 97,5% of electricity was generated at gas fired facilities whilst 2,5% amounted to diesel generation. To ensure energy supply in the following decades, "the Authority remains committed to finding ways in which Oman can benefit from its abundant renewable energy resources and thereby reduce its energy deficit in an economic and efficient manner."[6] In the wake of a renewable energy study of the Authority for Electricity Regulation, the Authority and the Rural Areas Electricity Company SAOC (RAECO) sought to initiative pilot project which could not be implemented yet. The Authority is aware of two major barriers. First, there are no policy framework or policy instruments which support the deployment of renewable energy project. Second, Oman subsidizes fossil fuel which renders electricity based on renewable energy more expensive.[6]

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Energy Production

In 2011, Oman has produced a total amount of 73,508 ktoe of energy, which is about 3,078 PJ or 854,898 GWh. Its sole energy sources are crude oil (65%) and gas (35%). Oman has no other energy sources, such as coal, nuclear power, heat, or renewable energy. The following table provides an overview of Oman's energy production in 2011.[7]

Table 1: Total Energy Production of Oman (2011)[7]:

Energy Source in ktoe in PJ in %
Coal and Peat 0 0 0
Crude Oil 47,406 1,985 65
Oil Products 0 0 0
Gas 26,102 1,093 35
Hydro 0 0 0
Geothermal, Solar etc. 0 0 0
Biofuel and waste 0 0 0
Electricity 0 0 0
Heat 0 0 0
Total 73,508 3,078

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Energy Supply

The total primary energy supply in Oman was 25,276 ktoe in 2011, which is consistent with 1,058 PJ or 293,959 GWh (see table 2). Unlike the national energy production, gas accounts for the largest amount of primary energy supply in Oman (18,040 ktoe), followed by crude oil (9,927 ktoe). Oman is a fossil fuel exporting country. In 2011, the country was exporting 39,481 ktoe of crude oil, 2,152 ktoe of oil products and 9,797 ktoe of natural gas.[7]

Table 2: Total Primary Energy Supply of Oman (2011)[7]:

Energy source in ktoe in PJ
Coal and Peat 0 0
Oil 9,927 416
Oil Product -2,690 -113
Gas 18,040 455
Nuclear 0 0
Hydro 0 0
Geothermal, solar, etc. 0 0
Biofuel and waste 0 0
Electricity 0 0
Heat 0 0
Total 25,276 1,058

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Energy Consumption

Oman's total final consumption (TFC) has steadily been increased in recent years. While in 2000 the energy consumption accounted for 588 ktoe (6,833 GWh),[8] energy consumption has added up to 1,591 ktoe (18,512 GWh) by 2011. Comparing various sectors with each other, the residential sector consumes the most energy, namly 49%, followed by the sector of commercial and public services (34%) and the industry (14%).[9] The exact figures are outlined in table 3. The number of electricity customers has been increased from 727,483 in 2011 to 790,277 which is an increase by 8.6%. Electricity consumers are mainly residential demanders, namely 71%.[6]

Table 3: Oman's TFC of Energy (2011)[9]:


Consumption in ktoe

Consumption in GWh

in %













Commercial and Public Services




Other non-specified







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Renewable Energy Sources


Producing electricity by wave energy is possible along the Arabian See coast. But in comparison to other locations in the world and compared to solar and wind energy resources, the energy density and hence the potential is relatively low.[5]

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Solar Energy

Oman has one of the highest solar densities in the world. Solar energy has even the potential to provide sufficient electricity to meet all of Oman’s national electricity demand. So far, solar energy is only used on private roofs to heat up water and in the oil production industry.[5]

The study on renewable energy in Oman has evaluated the solar insolation which varies from 4.5 to 6.1 kWh/m² per day. This corresponds to 1,640 to 2,200 kWh per year. Due to the fact that Oman’s solar insolation is characterized by a significant variance between the minimum and maximum values, a backup system has to be installed for those days with little solar insolation. Oman has the highest solar insolation during the summer period, when the electricity demand is also high. A possible surplus that is generated during the summer period might be exported since a seasonal storage is not available. While the regions in the deserts have the highest solar potential, coast areas in the southern part of Oman have a lower solar irradiation.[5]

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There is only limited potential for biogas electricity production in Oman since the available waste water, agriculture waste and animal dung is used mostly a fertilizers. Animal waste is additionally spread over large areas which makes the collection of sufficient quantities difficult and expensive.[5]

Water waste systems are operated in Muscat and Salalah by the Oman Wastewater Services and Salalah Wastewater Services Company. Both countries have the exclusive concession rights to build and operate waste water systems. Several sewer networks and treatment plant are at work throughout the country and are run by the Ministry of Regional Municipalities and Water Resources.[5]

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Wind Energy

Oman has significant wind energy potentials in coastal areas in the South and in the mountains situated north of Salalah. The highest wind speeds have been identified in the Dhofar Mountain Chain which is north of Salalah. The North and Western parts of Oman are the low wind speed areas. During the summer time, which is the peak period of electricity demand in Oman, the highest wind energy speeds were observed.[5]

Regarding the installation of wind turbine capacity in Oman, the technical future potential will be at least 750 MW. A technical limitation for the installation is the availability of open land without obstacles for erection of the turbines. The best locations for installing a total capacity of 750 MW would be in the mountains north of Salalah and in the coastal region of Sur. In total, an area of 100 km² is required consisting of 375 turbines with a capacity of 2 MW each.[5]

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Geothermal Energy

The potential to for utilizing geothermal energy for electricity production is only limited in Oman. Borehole temperature data and found temperature are below the required temperature to allow the direct use of water for steam plants.[5]

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Fossil Fuels

Oman is highly dependent on its fossil fuel sector. In 2012, 86% of government revenues and ca. 40% of the GDP were made up of revenues from the oil and gas sector. As of January 2013, Oman had 5.5 billion barrels of proved oil reserves. According to those numbers, Oman ranks 7th in the Middle East, and 21st in the world. To capitalize its strategic location, Oman seeks to expand its refining and storage sectors. A bunkering and storage terminal outside the Strait of Hormuz is a strategic location which could make the country an attractive option for international crude shippers.[10]

The country’s average annual crude oil production peaked in 2000 at 970,000 barrels per day (bbl/d). Due to declining production at the country's fields, the productions decreased to just 710,000 bbl/d in 2007. After improved Enhanced Oil Recovery techniques have been applied, the downward trend could be stopped and within the last 6 years the Oman could increase the crude oil production to 919,000 bbl/d in 2012. For the year 2013, Oman aims not only to produce an average of 940,000 bbl/d but also to hold this lever during the forthcoming 5 years. In comparison to other countries, the country is the 7th largest producer in the Middle East and 22nd worldwide with regard to crude oil production.[10]

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Electricity Situation

Oman's power system is not fully interconnected which is why the electricity sector has two major networks: First, the Main Interconnected System (MIS), which is the larger of the two, covers most parts of the North, and second, the Salalah system, owned by the Dhofar Power Company, serves the region in the South. Those areas outside of both networks are supplied with electricity by the Rural Areas Electricity Company.[11]

Oman is additionally connected to its neighboring country through the Gulf Cooperation Council's grid interconnection system, which makes electricity transfers between the six connected countries, including Kuwait, Saudi Arabia, Qatar, Bahrain, the United Arab Emirates, and Oman, possible. The interconnection between Oman and the VAE has been established in October 2011.[10]

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Electricity Supply

The total electricity supply increased from 18.5 TWh in 2011 to 21.0 TWh in 2012. This is an increase of 13.2%. Between 2005 and 2012 the supply of electricity has been increased by 11.4 TWh (+120%) and could respond to the fast growing demand of electricity.[6]

The installed capacity has been increased from 2007 to 2011 by 42% to 4,861 MW. In 2012, two power stations were finished, one in Salalah (445 MW) and the other in Rusail (665 MW). With the involvement of KfW and Siemens, the two power stations Sohar 2 and Barka 3 (both 744 MW) went on stream in April 2013. Further power stations are under construction and tender processes for 2 other station are under way.[12]

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Key Problems of the Energy Sector

Renewable energy projects face four major barriers: (1) Cost competitiveness and cost structure, (2) intermittency, (3) scale and (4) the legal framework.[5]

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Policy Framework, Laws and Regulations

General Energy Policy, Energy Strategy

Due to the high dependency on domestic gas and diesel, the Authority for Electricity Regulation (see for a description chapter “Institutional Set-up in the Energy Sector”) seeks to diversify the electric generation process. Besides importing gas, the Authority for Electricity Regulation remains committed to include renewable energy resources into the country’s energy system. Still, Oman lacks a policy framework, policy instruments and fuel subsidies prevent the deployment of renewable energy.[6]

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Important Laws and Regulations

The structure of the Omani energy sector and market was implemented by the Royal Decree 78/2004 which was announced 1 August 2004. In the wake of this Royal Decree, privatization of electricity companies and the establishment of a regulator, the Authority (see for further down), took place. Omani energy companies are governmental and privately owned. Government owned companies are: Electricity Holding Company, Oman Power and Water Procurement Company (OPWP), Oman Electricity Transmission Company, Wadi Al Jizzi Power Company, Al Ghubrah Power and Desalination Company, Mazoon Electricity Company, Majan Electricity Company, Muscat Electricity Distribution Company and Rural Areas Electricity Company (RAECO). Companies which a majority of private shareholders are: AES Barka, SMN Barka, Al Kamil Power Company, United Power Company, Dhofar Power Company, Sohar Power Company, Rusail Power Company.[5]

Specific Strategies and Projects

The renewable energy initiative started in 2008 when the Authority published a renewable energy study. Several projects are planned and were making progress in 2013. Oman's Rural Areas Electricity Company has outlined five projects in its Annual Report of 2012. Two of the shortlisted projects are wind farms in Masirah-Sharqia (2 x 250 KW) and Saih Al Khairat-Dhofar (2 x 2.1 MW). The remaining three solar projects are in Al Mazyonah-Dhofar (304 KW), Haima-Al Wusta (1,000 - 1,500 KW), and Al Mathfa-Dhofar (28 KW).[13]

Following the signing of a power purchase agreement by RAECO, Astonfield and Multitech LLC, the solar power plant in al Mazyunah in the Dhofar Governorate will be the country’s pilot RE project. Within this project electricity is produced in a hybrid system along with the existing diesel power station. It is expected that it can cover most of the city's electricity demand during the winter time.[14]

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Institutional Set-up in the Energy Sector

Relevant Ministries

The Ministry of Environment and Climate Affairs has been established in 2007 and is in charge of formulating environmental policies and prepares plans and programms of environmental protection, pollution control and nature conservation.

The Ministry of Regional Municipalities and Water Resources was established in 2007 according to the Royal Decree 91/2007.

The Ministry of Oil and Gas supervises the infrastructure of the oil and gas projects related to these sectors and coordinates the state's role in the hydrocarbon sectors. Nevertheless,the sultan finally approves policies and investments.[10]

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Relevant Official Institutions

The Authority for Electricity Regulation is responsible for the regulations of the electricity and the water sector. It was established in 2004 based on a Royal Degree (78/2004) and according to article 19 of the Law for the Regulation and Privatization of the Electricity and Related Water Sector. The Authority's duty is to secure the provision of electricity and water services in Oman.[15] The following activities are regulated through licensing by the Authority: (1) Generation, transmission, distribution, export, import or supply of electricity, (2) generation of electricity companied with desalination of water, (3) central dispatching, (4) development and/or operation of international connections, and (5) functions of the OPWP Company.[5] Moreover, the Authority is in charge of implementing general policies from the state and coordinates the activities between the various ministries, organizations and stakeholders in the sector.[10]

The Public Authority for Electricity and Water provides drinking water and electricity services. PAEW is a governmental institution founded on 9th of September 2007 by Royal Decree No. (92/2007), under the requisites of two royal decrees, nos. (58/2009) and (59/2009) issued on October 11, 2009. PAEW has a renewable energy department under the strategy, policies and studies general directorate. PAEW elaborates proposals for the renewable energy strategy of Oman and for pilot projects.

The Rural Areas Electricity Company SAOC (RAECO) is an Omani company which provides electricity to customers all over the Sultanate of Oman. It was established in 2005 according to the electricity sector & related water privatization law pursuant to the royal degree No 78/2004. The company is responsible for electricity generation, transmission, distribution & supply and desalination activities under a license issued by Authority for Electricity Regulation.[16] The Royal Degree 79/2004 also issued an electrification funding to provide electricity in remote areas. According to the World Bank, access to electricity amount to 98.0 %.[17]

The Oman Power and Water Procurement Company (OPWP) is the planning body for power supplies in the country. OPWP is responsible for securing electricity and water production capacities in the country and the single buyer of power and water for all IPP/IWPP projects. Within a statement, which is published every 7 year, new IPP/IWPP project are outlined to be competitively tendered and developed by private sector entities.[11]

Established in 2003, the Oman Electricity Transmission Company is in charge of the country's electricity transmission networks.

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Further Information

In October 2012, the German Helmholtz Association and the Omani research funding body, The Research Council (TRC), signed an agreement in Berlin to foster the cooperation between the two countries. The aim is to build a technology centre in Oman which will focus on improved oil and gas extraction, water resources technology and renewable energies.[18]

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  1. Central Intelligence Agency (CIA) - World Factbook Oman, Last Updated: Nov 12, 2013. Accessed: Dez 9, 2013. URL:
  2. Auswärtiges Amt, Oman Grundlagen der Innenpolitik, Accessed Dec, 9, 2013,
  3. 3.0 3.1 Bertelsmann Transformation Index 2012, Oman Country Report,
  4. The World Factbook: Oman, last updated on August 22, 2013,
  5. 5.00 5.01 5.02 5.03 5.04 5.05 5.06 5.07 5.08 5.09 5.10 5.11 Authority for Electricity Regulation Oman, Study on Renewable Energy Resources, Oman, Final Report, May 2008,
  6. 6.0 6.1 6.2 6.3 6.4 Authority for Electricity Generation, Annual Report 2012,
  7. 7.0 7.1 7.2 7.3 International Energy Agency (IEA), Oman: Balances for 2011,
  8. International Energy Agency (IEA), Oman: Electricity and Heat for 2000,
  9. 9.0 9.1 International Energy Agency (IEA), Oman: Electricity and Heat for 2011,
  10. 10.0 10.1 10.2 10.3 10.4 U.S. Energy Information Administration, Country Report Oman, last update: Oct. 10, 2013, Accessed Dec. 9, 2013,
  11. 11.0 11.1 Oman Power and Water Procurement Company (OPWP), Introduction to OPWP, Accessed Dec. 9, 2013,
  12. Germany Trade & Invest (GTAI), MENA-Region im Fokus 2013 - Oman,,did=830350.html
  13. Rural Areas Electricity Company, Annual Report 2012: Delivering Electricity to Rural Oman,
  14. Oman Daily Observer: Al Mazyunah to become 1st solar-powered city, Nov 14, 2013, Accessed Dec 9, 2013,
  15. Authority for Electricity Regulation, About the Authority,
  16. Rural Areas Electricity Company SAOC (RAECO), About us,
  17. World Bank, Data, Access to Electricity,
  18. Helmholtz Association, Stronger cooperation with Oman,

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