Oman projects account for 25pc of Petrofac’s global revenues

Muscat: The Sultanate of Oman has emerged as the biggest revenue earner for international oilfield services giant Petrofac, accounting for around a quarter of the UK-headquartered global firm’s total revenue of US$5.5 billion in 2019.

The contractor is currently undertaking a sizable portfolio of prestigious upstream, midstream, refining and petrochemical projects totaling several billions of dollars in government and public sector investments in the Sultanate.

The biggest of these is Duqm Refinery with Petrofac’s contract share totalling around $1.1 billion. Other key projects being executed by Petrofac include BP Oman’s Khazzan Phase 2 project (contract value of $800 million), the Salalah LPG project of OQ (formerly Oman Oil & Orpic Group) with a contract value of $600 million, and a number of projects awarded by Petroleum Development Oman (PDO).

“Oman, Kuwait and the UAE were the top three markets in 2019, generating 50 per cent of Group revenue (2018: the top three markets – Kuwait, Oman and Saudi Arabia – generated 58 per cent of revenue),” said Alistair Cochrane, Chief Financial Officer, in the group’s newly released Annual Report.

Significantly, the Sultanate was one of the group’s “success stories” of the year.  “As well as progressing several major projects, such as Phase 2 of the Khazzan Central Processing Facility, and the Duqm refinery, we continued to see the value of our 10-year Framework Agreement with Petroleum Development Oman, which enables Petrofac to provide EPCm support services for major oil and gas projects. New awards included the Mabrouk North East Line Pipe Procurement Project, the Mabrouk North East Development Project, and additional work on the Yibal Khuff project, which have a combined value of more than US$130 million,” said Petrofac.

Among the major contracts secured by the group in 2019 was the Mabrouk North East Line Pipe Procurement Project under a 10-year Framework Agreement with Petroleum Development Oman (PDO). Valued at approximately $75 million, the 19-month project scope includes management of line pipe material from sourcing, technical and commercial evaluation, planning and control services with management and co-ordination of interfaces with all parties involved.

Later in December, Petrofac received an additional award under PDO’s 10- year framework for an Engineering, Procurement and Construction Management (EPCm) services contract for the Mabrouk North East Development Project. The 34-month project scope involves the development of 16 gas producing wells and export of the production to the Saih Rawl Central Processing Plant. The project will be integrated with the Mabrouk North East Line Pipe Procurement Project.

Also in December, the company was awarded a 20-month contract to provide further services for PDO’s Yibal Khuff Project, including detailed Engineering, Procurement, and support for Construction and Commissioning of nine additional wells to improve overall plant production, and laying of gas pipeline from Yibal “A” to the main processing facility. The additional Yibal Khuff scope of work and the Mabrouk North East Line Pipe Procurement Project contract are worth a combined value of approximately $130 million, said Petrofac.