Omani oil major Petroleum Development Oman (PDO) has signed two deals worth $253.1mn to ‘Omanise’ the provision of upstream equipment in its supply chain.
The Company has signed contracts for the local manufacture and supply of transformers and valves which will be used in its operations and beyond.
The deals are further evidence of PDO’s In-Country Value (ICV) programme to retain more of the wealth of the oil and gas sector in the Sultanate and develop domestic supply chains.
PDO has struck deals with Rusayl-based Voltamp Transformers Oman for the supply of power transformers and with Al Jizzi Transformers and Switchgears, located in Ma’abella, for the supply of wellhead transformers. The companies employ almost 100 Omanis in total.
It also penned agreements with Muscat-based Techno Fit Trading: one with Chinese concern Wuzhou Valve Company for the manufacture of ball valves, and one with Indian firm Gene-tech Controls for the manufacture of mono-flange valves.
After the first three years of these deals, both of the foreign companies have agreed to establish production facilities in the Sultanate to manufacture the components locally.
The product range covers thousands of valve items from half-inch to 24-inch in size in various material grades, covering the majority of PDO operations, as well as potentially the wider petro-chemical industry in Oman and beyond.
“We are working hard with our partners to ensure that Oman builds its capacity and capability to competitively and professionally service both the nation’s oil and gas industry but also that beyond our borders,” PDO’s managing director Raoul Restucci commented of the company’s latest ICV initiative.
“ICV not only shortens our supply lines and reduces our delivery times and transport costs, but also provides more vocational training and employment opportunities for Omanis while boosting the Sultanate’s economy,” Restucci was quoted as saying in a press release received by arabianoilandgas.com.
The supply and maintenance of valves is the 17th opportunity to be realised by PDO since the ‘ICV Strategy Blueprint’ for the Sultanate’s oil and gas operators was unveiled in 2013 to boost local business participation in the country’s hydrocarbon exploration and production sector.
So far, the company has localised the supply and manufacture of goods and services in a number of key areas, such as scaffolding, carbon steel pipes, well engineering equipment and the provision of polymer for enhanced oil recovery.
Approximately 41% of PDO’s overall contracts are now placed with local businesses, and as much as 53% of its well engineering contracts are awarded to Local Community Contractors – a figure that is amongst the highest in the regional industry.
“We are delighted to sign these contracts for the provision of important equipment and parts for the oil and gas sector. Beyond the local supply of goods and services to the requisite technical level, they provide the further demonstration of how our contractors and suppliers are playing a greater role in embedding ICV in their operations,” Restucci said.