April 20, 2024

OQ Group Spends USD 2.825 Bn on Local Businesses and Communities in Al Wusta Governorate

Press release
Corporate Investor relations

OQ, the global integrated energy group, and its partners have spent USD 2.825 billion on goods and services from local suppliers in Al Wusta Governorate, Oman. This significant contribution is part of the group's unwavering commitment to enriching local markets through a structured and regulatory framework aimed at maximising In-Country Value (ICV).

OQ places significant emphasis on ICV due to the vital role that local companies play in building and sustaining the country's economy. The group invests in programs that foster the growth and development of these companies, providing opportunities for sourcing goods manufactured in Oman and services from locally registered suppliers. Additionally, the group contributes to job creation, skills development and innovation within small and medium-sized enterprises (SMEs). The Group’s growth projects have provided numerous opportunities, both during the construction phase and in ongoing operations, thus enhancing job prospects and developing human capital.

The Duqm Refinery (OQ8), a joint venture between OQ and Kuwait Petroleum International, stands out as the largest investment in the Duqm Economic Zone and one of the biggest and most advanced refineries in the Middle East. It has significantly boosted local market spending, with expenditure on goods and services during the construction phases of the Duqm Refinery reaching USD 2.54 billion. This includes USD 475 million spent on SMEs, USD 1.7 billion on services from local companies, and USD 84 million on imported products from suppliers registered in Oman. Products from national industries supplied to the Duqm Refinery are valued at USD 265 million.

These efforts form part of the refinery’s strategy to enrich local markets through a regulatory and legislative framework aimed at maximising the In-Country Value as part of Duqm Refinery and Petrochemical Industries Company (OQ8)'s value maximising strategy. Committed to boosting ICV and social responsibility, and to fostering local development, the Duqm Refinery has allocated 10% of the construction work to small and medium enterprises, particularly those based in Al Wusta Governorate.

As part of its strategy to enhance ICV, the refinery requires that contractors for the three project packages allocate 20% of the total value of project purchases to locally manufactured materials and services from local suppliers. Community engagement is a core pillar of the Duqm Refinery’s operational strategy, focusing on interaction with local communities and support through a wide range of initiatives including community development programs, educational opportunities, and training.

The Duqm Refinery is committed to investing in infrastructure and services that improve the lives of local residents, building a positive and sustainable relationship with all community members. More than USD 5.4 million has been earmarked to fund social projects, with a special focus on education, health, and environmental conservation, underscoring our firm commitment to community welfare and development.

Significant progress has been made in developing competencies and building national capacities to enhance local communities; the refinery has for several years adopted valuable initiatives such as the "Science of a Refinery" initiative and an English language development program for students in Al Wusta Governorate in collaboration with the British Council, aimed at enhancing students' skills and preparing them for the workforce.

In training and qualification efforts, the refinery provided 476 training scholarships for employees and 186 training opportunities for national caders, contributing to 104 university and college scholarships in Oman, and 10 scholarships at international universities.

The Ras Markaz Crude Oil Storage Project, managed by Oman Tank Terminal Company (OTTCO), part of the OQ Group, is a key government initiative in Al Wusta Governorate to promote economic diversification and sustainability. Since the project's inception through to the end of 2023, approximately USD 196 million has been invested in ICV, with USD 114 million spent on contracts awarded to local companies, in addition to USD 36.3 million allocated to purchases from local suppliers and USD 36.2 million for locally manufactured purchases. Of these funds, USD 39 million was directed to support small and medium enterprises.

The project also provided 5 scholarships for General Diploma graduates and training opportunities for 25 trainees, in addition to numerous direct and indirect employment opportunities for local residents, contributing to the stimulation of the local economy and enhancing social stability. The project also supported community responsibility during the construction and operation phases in areas such as education and community service, thus enhancing positive interaction between the project and the local community.

Duqm Refinery has built a database of various small and medium enterprises whose operations match the company's needs, with a focus on involving them in tenders, prioritising those located in the Duqm Special Economic Zone. The company strives to maximise the benefits for small and medium enterprises in its projects, supporting the entrepreneurship sector and overcoming the challenges that entrepreneurs face.

Recently, the Ministry of Health and OQ signed an agreement to fund the establishment of an emergency and accident unit at the health centre in the Duqm of Al Wusta Governorate. This initiative aims to strengthen the health sector in the Sultanate of Oman and support the efforts of relevant authorities to enhance healthcare services for citizens and residents. The unit, valued at half a million Omani Rials, will include an operating theatre, intensive care, inpatient rooms, a blood bank, and supporting health facilities. OQ and its companies and partners are enhancing social and economic development in Al Wusta Governorate, embodying their social role and responsibility in the communities they serve.