Petroleum Development Oman (PDO) has awarded long-term service contracts totalling $4 billion for project delivery and maintenance and integrity work in the north and south of its domestic concession area.
The agreements with Arabian Industries Projects (AIP) and Special Technical Services (STS) involve the design and execution of more than 200 on-plot projects and will run for seven years with an optional three-year extension.
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.
PDO managing director Raoul Restucci said: “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 opportunities.
“They represent a benchmark of best practice by capturing the lessons learned over the past 17 years from engineering, maintenance and construction contracts across our concession area.”
PDO said 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.
“Considering the sheer size and dimensions of these contracts, embedding such improvements within 15 months of the tendering period during the Covid-19 pandemic is an outstanding achievement,” added Restucci.
“Arabian Industries will deliver these contracts by maximising in-country value and the employment of the Omani workforce, providing them with the necessary training and development and reskilling as required,” said AIP chief executive Sadiq Sulaiman.
“Furthermore, we see these contracts as the ideal platform to bring innovation and efficiencies that will surely contribute to the overall efficiency of the hydrocarbon industry in Oman.”
Current ‘Omanisation’ — local content — 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.
Also a training for employment scheme has been introduced, enabling the training, reskilling and upskilling of more than 1000 Omanis, and about 1500 Omani employees from incumbent PDO contractors will be transferred and redeployed to the new contractors.
Local sub-contracting businesses and small and medium enterprises 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 company 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.