Marsa LNG Project : TotalEnergies and OQEP begin construction in Sohar, Oman

Why Is the Marsa LNG Project in Oman Strategically Important?

TotalEnergies SE and Oman‘s OQ Exploration & Production have officially begun construction of the Marsa LNG Project at the port of Sohar, a significant milestone reached a year after the Final Investment Decision was approved. The plant is expected to deliver 1 million tonnes per annum (Mtpa) of liquefied natural gas starting in Q1 2028, with its primary use focused on LNG bunkering for ships navigating the Gulf.

Located at the strategic maritime entry point of the Gulf, Marsa LNG is designed to serve as the first dedicated LNG bunkering hub in the Middle East. The project aims to provide a cleaner marine fuel alternative to traditional bunker oil, directly supporting global decarbonisation efforts in the shipping sector.

Marsa LNG LLC—a joint venture company with TotalEnergies holding an 80% stake and OQEP owning 20%—will oversee both upstream and downstream activities, making the initiative one of the region’s most comprehensive and integrated gas infrastructure projects.

How Will Marsa LNG Achieve Ultra-Low Emissions Targets?

The Marsa LNG Project is being positioned as one of the lowest-carbon LNG plants in the world. With expected Scope 1 and 2 emissions below 3 kg of CO₂e per barrel of oil equivalent (boe), Marsa LNG is designed to operate with roughly 90% lower emissions than the global industry average of 35 kg CO₂e/boe.

To meet these ambitious goals, Marsa LNG will be powered entirely by electricity generated from a 300 MWp photovoltaic (PV) solar facility, developed as part of the integrated infrastructure. This solar power project will meet 100% of the annual power requirement for the LNG plant, avoiding the need for natural gas or other fossil fuels in plant operations.

Engineering and construction responsibilities have been awarded to Technip Energies for the LNG liquefaction facility and CB&I for the 165,000 m³ LNG storage tank.

What Is the Broader Vision Behind the Marsa LNG Project?

The Marsa LNG initiative aligns with the Sultanate of Oman’s Vision 2040 strategy, which prioritises sustainable energy development, economic diversification, and industrial innovation. Speaking at the groundbreaking ceremony, Oman’s Minister of Energy & Minerals, Eng. Salim bin Nasser Al Aufi, emphasised the government’s intent to bolster the downstream energy sector through strategic partnerships, infrastructure development, and clean fuel adoption.

OQEP CEO Ahmed Al Azkawi stated that Marsa LNG would play a key role in lowering maritime emissions, while enhancing Oman’s competitiveness in the clean energy supply chain. As LNG demand continues to rise, especially in Asia and Europe, the Sohar-based project is expected to position Oman as a pivotal bunkering and distribution hub.

The Marsa LNG bunkering vessel, Monte Shams—named after Oman’s highest mountain, Jabal Shams—is currently under construction and will be deployed in Sohar from 2028. It will cater to a broad range of ships, including container vessels, oil tankers, and cruise liners.

How Is Marsa LNG Positioned Within TotalEnergies’ Global Gas Strategy?

TotalEnergies SE is currently the third-largest LNG player globally, with a portfolio exceeding 40 Mtpa as of 2024. The French energy major is pursuing a strategy to raise the share of natural gas in its sales mix to nearly 50% by 2030. Marsa LNG plant is a key component of this ambition, serving both as a clean energy showcase and a regional LNG hub.

In 2024, TotalEnergies signed a long-term offtake agreement with Oman LNG to purchase 0.8 Mtpa of LNG for a 10-year period beginning in 2025. The company’s strategic investments span upstream operations (via Block 10), gas liquefaction, solar infrastructure, and LNG marketing—giving it a fully integrated position along the natural gas value chain.

By coupling low-carbon LNG production with renewable energy sourcing, Marsa LNG aligns closely with TotalEnergies’ broader objective of achieving net-zero emissions and promoting methane-free natural gas solutions across global markets.

What Does the Market Say About TotalEnergies’ Stock Performance?

As of early May 2025, shares of TotalEnergies SE (NYSE: TTE) are trading near $57.81, reflecting mixed sentiment amidst sector-wide headwinds including falling oil prices and shifting investor preferences toward renewables. The company’s Q1 2025 adjusted net income declined 18% year-over-year to $4.2 billion, contributing to a moderately bearish outlook in the short term.

Despite the earnings dip, TotalEnergies’ fundamentals remain strong, particularly its diversified energy strategy and shareholder return commitments. The firm recently declared a first interim dividend of €0.85 per share for fiscal 2025, up 7.6% from 2024, reinforcing confidence in its capital return framework even amid market volatility.

Analyst consensus tilts toward a ‘Hold’ rating, with forecasts suggesting the stock could edge up to $60.81 in the coming weeks—a projected upside of approximately 5.7%. However, institutional caution persists. Hedge fund Elliott Management disclosed a €670 million short position, citing exposure to geopolitical and commodity price risks as primary concerns.

How Are Institutional Flows Impacting Sentiment Around TTE?

Institutional investor flows into TotalEnergies remain muted. The Fear & Greed Index shows a reading of 39, indicating broader caution in the energy sector. Fund managers have reportedly shifted allocations towards utility and renewable sectors, reducing exposure to oil-linked assets amid macro uncertainty.

However, TotalEnergies’ aggressive repositioning toward natural gas and LNG infrastructure—backed by long-term supply contracts and vertically integrated investments—is seen as a medium- to long-term stabiliser for earnings, particularly in energy-importing markets like Europe and Asia.

The Marsa LNG Project, with its advanced emissions profile and geographic positioning, may play a role in reshaping investor perception. As LNG demand accelerates due to coal phaseouts and new maritime regulations, TotalEnergies’ exposure to lower-emission fuels could become a future strength.

What Is the Outlook for LNG Bunkering and Clean Shipping?

The shipping industry is under growing regulatory pressure to reduce emissions. LNG bunkering is increasingly viewed as an interim solution to bridge the gap between heavy fuel oil and zero-emission alternatives such as green ammonia or hydrogen. LNG offers a 20–23% reduction in GHG emissions compared to conventional marine fuel, along with up to 99% reductions in SOx, fine particles, and NOx emissions.

By eliminating the need for imported LNG bunkering via distant ports and offering locally produced, solar-powered LNG, the Marsa facility offers cost and carbon efficiency. This aligns well with International Maritime Organization (IMO) decarbonisation targets and makes Sohar a model hub for future green fuel supply chains.

What Economic Impact Will Marsa LNG Have on Oman?

Beyond energy diversification, the Marsa LNG plant is expected to bring long-term employment, technology transfer, and skill development opportunities to the Sohar region. With construction, operations, and solar power integration, the project touches multiple segments of Oman’s industrial ecosystem, from logistics to renewable energy.

By leveraging foreign direct investment, international engineering expertise, and a public-private collaboration model, Oman aims to enhance its position as a dependable energy partner in the Gulf while progressing toward its Vision 2040 goals for economic resilience and sustainable development.

Marsa LNG is not just another LNG facility—it represents the next generation of clean gas infrastructure designed to meet the dual challenge of energy security and decarbonisation. Through its integration of solar energy, high-efficiency liquefaction, and maritime bunkering services, the project stands as a benchmark for global LNG plant development.

For TotalEnergies, it reinforces a strategy that embraces gas as a transitional fuel while pursuing net-zero objectives. For Oman, it signals an era of industrial advancement with sustainability at its core.

As global demand for cleaner fuels rises, and carbon regulations tighten, Marsa LNG Project may offer a replicable template for energy infrastructure that balances profitability with environmental stewardship.