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PDO’s $4bn long-term service contracts to create more jobs

24 Mar 2021

Petroleum Development Oman (PDO) signed major service contracts worth US$4bn, on Wednesday, 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, supervisory and engineering positions. 

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

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

Additionally, 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 domestic contractors 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 Raoul Restucci – managing director of PDO, Sadiq Sulaiman – CEO of AIP, Rejeesh Mani – CEO of STS, Amer al Sulaimani – managing director of AIP, and Alex Clark – managing director of STS.

On the occasion, 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 (ICV) opportunities. They represent a benchmark of best practice by capturing the lessons learnt over the past 17 years from engineering, maintenance and construction contracts across our concession area.” 

Restucci noted that a seamlessly transition is expected from PDO’s existing on-plot deals in the coming months, working hand-in-hand with AIP and STS to deliver a large portfolio of projects safely, responsibly and efficiently. “Considering the sheer size and dimension of these contracts, embedding such improvements within 15 months of the tendering period during the COVID-19 pandemic is an outstanding achievement.

“I congratulate and thank all those responsible for bringing these agreements to fruition, as they will generate exceptional value both for our company and the country,” Restucci added.

The scope and scale of contracts are significant, spanning over the 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.

 

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