Methanol $5 billion refining and petrochemical project site selection enters final sprint, bypassing the Strait of Hormuz

The MERA Oil consortium, jointly formed by US and Saudi capital, is advancing a large-scale energy complex project with an initial total investment scale of approximately $5 billion. The core objective is to establish a refining and refined product export channel that bypasses the Strait of Hormuz, and the site selection process has currently entered its final stage.

MERA Oil is jointly composed of US-based MWG Enterprises, Patel Family Office, and PWS, a subsidiary of Saudi AHQ Industrial Group. After three years of multi-site research and evaluation, the consortium has screened three candidate sites within the member states of the Gulf Cooperation Council (GCC), and in-depth business negotiations regarding these three locations have been ongoing for two years. Officials have not yet publicly disclosed specific information on the candidate locations but have confirmed that all selected sites are located outside the Strait of Hormuz, and the project is currently still in the planning phase.

200,000 Barrels/Day Integrated Refinery as the Core, Supported by Full-Chain Maritime Export Infrastructure

The entire project centers on an integrated refinery processing 200,000 barrels of crude oil per day as the core facility, with a product focus on high-quality middle distillates, primarily producing ultra-low sulfur diesel and aviation kerosene.

The project is not merely the construction of a single refinery; it aims to create an energy complex integrating refining production, storage, logistics, and external export, reserving space for downstream industry expansion. Plans include supporting deep-water ports, large-scale crude oil and refined product storage tank farms, and a maritime export system to enable direct shipment of refined products to global markets. According to the schedule, upon finalizing the site selection, final engineering design studies will commence immediately, striving to achieve mechanical completion and commence commercial operation by the end of 2029.

Targeting Medium-to-Long-Term Supply and Demand Patterns, Avoiding Waterway Risks to Enhance Supply Resilience

Marc Gunderson, founder of MWG Enterprises, stated that the investment logic of the project relies on long-term structural changes in the energy market and does not follow short-term fluctuations in refining margins. The continuous contraction of domestic refining capacity in Europe and the US, coupled with sustained growth in global middle distillate demand, provides long-term support for the project.

The site selection plan away from the Strait of Hormuz can enhance shipping operational flexibility, reduce geopolitical waterway risks, and improve energy supply stability. Site selection also balances transportation economic benefits, where export competitiveness will comprehensively consider factors such as shipping distance, maritime costs, and geopolitical risks of transit waterways.

Multi-Party Discussions on Crude Oil Sources, Supplying Markets Across Multiple Global Regions

MERA Oil plans to supply products to the US, the Atlantic coast, the Gulf region, and other refined product import markets. At this stage, the consortium is simultaneously engaging with multiple crude oil suppliers both within and outside the GCC; site selection assessments and crude oil supply agreement negotiations are proceeding in parallel.

Impacted by geopolitical conflicts, global refined product supply and demand have been tighter than the crude oil market in recent years, and refining margins for varieties such as diesel and aviation kerosene have remained high, a context in which this project is being advanced. Constrained by the fact that the site selection has not yet been finalized, key plans including the overall project layout, approval processes, crude oil transportation routes, and construction schedules remain subject to adjustment.