French energy group ENGIE has signed a new power purchase agreement (PPA) to bring Oman’s Sohar 1 power and desalination facility back online.
The deal is a major step in reviving the 20-year-old plant after a prolonged period of dormancy.
The agreement, finalised in October 2024, covers 405 MW of open-cycle gas turbine (OCGT) capacity and follows an extensive debt restructuring process that enabled the company to secure a competitive tariff.
The plant officially resumed operations on March 28, 2025, reaching its commercial operation date (COD), ENGIE confirmed in a statement.
Sohar 1, located in Oman’s industrial port city of Sohar, initially entered service with a 585 MW combined-cycle gas turbine (CCGT) setup alongside a desalination component capable of producing 150,000 cubic metres of water per day using multi-stage flash technology. However, its original PPA expired in May 2022, after which the plant was mothballed and maintained in “preservation mode” by its operator, ENGIE STOMO (SUEZ Tractebel Operation & Maintenance Oman LLC).
The new PPA represents a strategic shift in capacity utilization, focusing on OCGT rather than restarting the facility in its previous CCGT configuration.
“This deal reflects ENGIE’s ability to adapt to market realities while preserving critical infrastructure assets in the Gulf region,” said a person familiar with the matter, noting that Sohar 1’s reactivation reinforces energy security in northern Oman.
The revival of Sohar 1 is particularly timely as Oman looks to balance energy demand with its long-term ambitions to diversify its power mix.
ENGIE, a major player in the Middle East’s utilities sector, operates several power and water projects across the Gulf and has recently been pursuing a more agile asset strategy in response to evolving market conditions and contract frameworks.
