Petroleum Development Oman signs $4 billion service contracts

Dubai: Petroleum Development Oman (PDO) on Wednesday signed major service contracts worth $4 billion covering project delivery and maintenance and integrity work in the North and South of its concession area.

The agreements with Arabian Industries Projects (AIP) and Special Technical Services (STS) encompass the design and execution of more than 200 on-plot projects and will run for seven years with an optional three-year extension.

Current Omanisation levels will double over the life cycle of the contracts, resulting in several thousand additional employment opportunities for Omanis, with a focus on skilled jobs, supervisors and engineering positions.

A Training for Employment scheme has been introduced, enabling the training, re-skilling and upskilling of over 1,000 Omani personnel, and about 1,500 Omani employees from incumbent PDO contractors will be transferred and redeployed to the new contractors.

Benefits to SMEs

Local sub-contracting businesses and small and medium enterprises (SMEs) will also benefit with specific targets for both, and an obligation on the part of the contractors to ensure and monitor their use.

In addition, the deals include a strategy to develop a domestic firm to execute maintenance and integrity tasks in a selected cluster in the PDO oil and gas portfolio within five years.

This further builds on the focus to introduce and mature a domestic contractor for turnarounds to carry out facility maintenance in scheduled shutdowns as recently endorsed by Oman LNG, OQ, OPAL and PDO.

The signings took place at an official contract awards ceremony at PDO’s Mina Al Fahal headquarters, which was attended by PDO Managing Director Raoul Restucci, AIP and STS Chief Executive Officers Sadiq Sulaiman and Rejeesh Mani, and the companies’ Managing Directors Amer Al Sulaimani and Alex Clark.

“These strategic agreements create a win-win culture for PDO, our partner contractors and Oman, in that they maximise capital efficiency, generate multi-million-dollar savings and enhance In-Country Value (ICV) opportunities,” said Restucci.

The scope and scale of contracts are significant, spanning the execution of maintenance, integrity, field improvement proposals, turnaround activities, and the delivery of brownfield projects.

Under the terms of the deals, AIP will carry out project delivery in the North of Block 6 and maintenance and integrity work in the South, while STS will be responsible for project delivery in the South and maintenance and integrity in the North.