Social media was abuzz with news over the weekend of an impending announcement by Petroleum Development Oman (PDO) – the biggest player in the Sultanate’s hydrocarbon sector by far – of its keenly awaited transition into a broad-based energy development holding company with an enlarged mandate to cover investments in, among other areas, renewable and alternative energy resources.
Energy Development Oman (PDO), the concept behind which was first unveiled by Managing Director Raoul Restucci (pictured) nearly three years ago, centres on a vision to reposition PDO from an essentially fossil fuels-based producer to a “fully fledged energy company”.
The strategy envisions PDO’s diversification into, among other areas, solar and alternative energy development, energy management, low-carbon technologies, oil and gas consultancy services, and water management. The Omani government is a 60 per cent shareholder in PDO, which accounts for a predominant share of the country’s oil and gas output
In an online address to company employees last week, Restucci outlined, among other things, the company’s strategy to weather the crisis unleashed by the Covid-19 pandemic as well as the collapse in international oil prices. A notable part of the strategy, he said, is the establishment of Energy Development Oman designed to diversify the company’s activities and thereby reduce its vulnerability to upheavals of the kind that the global Oil & Gas industry is currently undergoing.
Plans for the creation of EDO now have the “full endorsement” of the Omani government, said the Managing Director. “What that means is twofold: One, EDO will be a holding company of PDO and a number of investments. For PDO, it will enable us to corporatise the entity and thus enable us to secure the funding and resources which the government at the moment is securing for us at very high cost. We will be able to deconsolidate that debt and secure it at substantially more attractive terms; Second, EDO is also about to transition as well. We have a number of businesses, a number of investments that are very keen to partner with us.”
In a statement to the Observer, PDO noted: “We are progressing plans aimed at corporatising PDO and developing renewable energy opportunities in close coordination with the Government and enabled by the establishment of Energy Development Oman (EDO).“
In recent years, PDO has embarked on a number of initiatives that champion energy efficiency in oilfield operations, use of renewables and low-carbon emission technologies, and environmental sustainability.
PDO is a global pioneer in the use of solar energy to generate steam necessary for its Enhanced Oil Recovery (EOR) operations. To this end, PDO is collaborating with GlassPoint Solar in the implementation of a 1-gigawatt Miraah project that harnesses solar energy to produce heavy oil from the Amal oilfield instead of natural gas for steam generation.
Last year, the company brought into operation its maiden utility-scale solar PV project — a 100-MW installation at Amin in the southern part of its concession — under a long-term Power Purchase Agreement (PPA) reached with investors in the Independent Power Project (IPP).
Furthermore, PDO is exploring avenues for investment in solar and wind resources for power generation and water desalination, power to ‘X’, solar to hydrogen, and other opportunities. The company has also expressed an interest in bidding for large-scale solar power schemes procured by state-run Oman Power and Water Procurement Company (OPWP).