Abu Dhabi and Oman have signed an agreement to set up a refinery in the Sultanate with an output capacity of 230,000 barrels per day, to be followed by a petrochemical complex, Oman’s official media reported on Tuesday.

The refinery in the southern industrial port of Duqm will be equally owned by the International Petroleum Investment Company (IPIC) and Oman Oil Company (OOC), which both are controlled by their respective governments.

The agreement created a joint venture called “, Duqm Refinery and Petrochemical Industries” and the refinery will be completed by 2017, according to the official Omani News Agency.

It quoted Nasser bin Khamis Al Jashmi, Undersecretary of the Oil and Gas Ministry and OOC Chairman, as saying the development of the refinery and petrochemical complex is considered to be one of the most important investment projects as it will play a vital role in supporting the oil and petrochemical industries in Oman due to the strategic location of the Duqm area, adjacent to one of the world's key shipping trade routes.

"We are determined to put all necessary efforts to see the project is successfully commissioned in 2017 and there is no doubt our solid partnership with Oman Oil Company gives us confidence in achieving that,” said IPIC managing director Khadem Abdullah al Qubaisi.