MUSCAT - Omani small and medium-sized enterprises (SMEs) saw revenues earned through the In-Country Value (ICV) programme grow by around 14 per cent of total spending last year, according to the Ministry of Energy and Minerals.

The ICV programme also opened up a total of 16 economic and contracting opportunities for competitive bidding by local companies, and also identified four oil investment opportunities for localisation.

Indeed, through the Oil and Gas In-Country Value (ICV) strategy, the Ministry of Energy and Minerals managed to redirect more than RO 2 billion in spending to the local economy and contribute to providing more than 18,000 jobs for Omanis during the period from 2018 to 2020.

First launched by the Ministry in 2013, the ICV programme requires Oil & Gas operators and major contractors to channel part of their procurement and contracting expenditure to local companies and SMEs in a bid to fuel national economic growth. The share of total expenditure channelled to SMEs through the programme rose from 18 per cent in 2018 to 28.7 per cent in 2020.

The concept of ICV refers to the total amount spent within the country for the benefit of SMEs, which would contribute to the development of these enterprises and open up a new revenue stream for their growth.

Globally, ICV provides job opportunities estimated at between 40 and 80 per cent of total job creation. SMEs represent about 90 per cent of total companies in the world and contribute more than 50 per cent of the GDP growth of the 10 largest G20 economies.

In the Sultanate of Oman, all of the major Oil & Gas operators have been energetically supporting the Ministry’s ICV programme. Petroleum Development Oman (PDO), for example, has continued to support hundreds of Omani SMEs and companies by allocating part of the scopes of contracts. PDO was able to provide more than 3,000 job and training opportunities for Omanis in various technical and non-technical disciplines.

Oxy Oman announced through the annual report of the Ministry of Energy and Minerals that the contribution of the company’s contractors to the local added value increased from 49.4 per cent in 2020 to 53.22 per cent in the third quarter of 2021. SMEs spending increased from 18 per cent to 20 per cent over the same period.

The company had established the "Tasharek" programme (meaning ‘cooperation’) to support capacity building for Omani SMEs. Oxy Oman launched and supported several In-Country Value (ICV) initiatives over the past year to improve contractors' capabilities.

For its part, BP Oman spent more than $312 million on registered Omani companies, which represents 89 per cent of its total spend. It spent more than $19.5 million on Omani SMEs, or 6 per cent of total spend, an increase of 2 per cent over 2020.

Daleel Petroleum has undertaken several initiatives in the field of enhancing in-country value, the most important of which was sponsoring the Omani Academy for Small and Medium Enterprises, signing agreements to provide financing solutions to SMEs, and organising a programme in Al Dhahirah Governorate for contractors of local companies.

In 2021, the revenues of Local Community Contractors (LCCs) amounted to about RO 260 million, while spending on SMEs amounted to about RO 207 million. By mandating the localising of goods and services under the ICV initiatives, local businesses have benefited from investments in excess of RO 115 million encompassing over 80 different types of manufacturing, contracting and service opportunities. Overall, around 37 per cent of the total spend of the Oil & Gas sector was retained in-country in 2021.

According to recent statistics issued by the Ministry of Energy and Minerals, the number of shareholders in local community companies reached about 9,400 shareholders until 2021, all of whom are from the concession areas.

These companies provide a range of basic activities in the field of oil and gas, including: logistics services, electricity services, equipment rental, road maintenance, civil construction services, well maintenance operations and pipeline maintenance.

Oil and gas companies also provide support and assistance to major local community companies to ensure the sustainability of their activities. These companies have contributed to diversifying the sources of income for Omanis residing in the concession areas, replacing foreign companies with national companies, giving them a leap to advanced stages in the field of oil industries, creating job opportunities and jobs for Omanis, and rehabilitating and training them.

The number of Omani employees in LCCs now totals over 2,000.

The six leading LCCs are: Al Haditha, Al Baraka, Al Shawamikh, Al Sahari, Al Khazaen and Al Sawary Company.

2022 © All right reserved for Oman Establishment for Press, Publication and Advertising (OEPPA) Provided by SyndiGate Media Inc. (