Oman plans to more than double the oil storage capacity of a port outside the Strait of Hormuz, leveraging its strategic location as energy-producing nations in the Middle East search for alternatives to the highly sensitive shipping lane.

Ashraf Al Mamari, chief executive of state-owned energy company OQ SAOC, said in an interview that the company is evaluating the purchase of two supertankers to be leased out as offshore floating storage facilities at Duqm port. The company also plans to raise onshore crude tank capacity from about 5 million barrels currently to 10 million barrels within three years.

As Middle East conflicts disrupt this critical global energy transit chokepoint, storage facilities outside the Strait of Hormuz are becoming increasingly important. Oil producers such as the UAE and Saudi Arabia are still pushing tankers to transit the strait with transponders switched off, while also exploring alternative pipeline routes.

Located on the Arabian Sea coast, Duqm port can give customers easier access to crude and reduce reliance on the high-risk route through the Strait of Hormuz. Al Mamari said that once the supertanker purchases are completed, converting them for storage use would take about six months.

Duqm has long been viewed as a potential terminus for a pipeline crossing the Arabian Peninsula that could export crude from producing regions in countries such as Saudi Arabia or Kuwait, though no such project has materialized so far. A refinery jointly operated by Oman and Kuwait's state oil producers is also located there.

After the Strait of Hormuz was disrupted, both Saudi Arabia and Kuwait said they were studying alternative pipeline options but have yet to announce specific plans. Saudi Aramco CEO Amin Nasser said the company is looking for alternatives beyond its traditional Red Sea and Persian Gulf export routes. The UAE plans to build more pipelines to the Fujairah oil hub outside the Strait of Hormuz.

"As far as pipelines are concerned, Oman's message is that we are certainly open to it, but discussions are still at a very early stage," Al Mamari said. He said the negotiations are currently taking place at the government-to-government level and he is not aware of the specific details.

Al Mamari also said OQ will weigh the high cost of acquiring vessels against the potential returns from oil storage before deciding later this year whether to add two supertankers as floating storage facilities at Duqm, each capable of storing 2 million barrels of crude.