Petroleum Development Oman (PDO) said it will start sourcing key well construction parts annually worth US$100 million for its oilfields from within Oman with the opening of a new factory in Sohar.
PDO has worked with Chinese manufacturer Changbao to set up a new tubing threading and finishing plant where plain tubing will be sourced from China and then threaded and finished in the new $20 million facility in the Sohar Free Zone, the company said in a statement.
The move will kick off the process of localising seamless oil country tubular goods (OCTG) technology. The facility will have a threading capacity of 50,000 metric tonnes a year and also offer storage and repair services.
Previously, the company spent approximately $100 million on importing casing and tubing from China.
The Changbao Oman Oil Pipe Company facility will provide 30 jobs when it runs at maximum capacity with the aim hire Omani nationals for all positions over the coming years.
“We have been working hard to retain more of the wealth of our industry in-country by Omanising the manufacture and supply of key oil and gas equipment,” said PDO’s wells operations manager Said Al Mahrooqi.
“The new plant will not only reduce the cost of tubing and casing for PDO wells but also shorten delivery times to our fields,” he said.
PDO well engineering directorate currently spends $1.8 billion on local contracts as the company ramps up its In-Country Value policy to generate Omani job and training opportunities and develop a robust and skilled local supply chain.
The directorate drills around 650 oil and gas production and exploration wells annually and drilled 1,473.7 kilometres last year, a 16 per cent rise on 2015. There were also 19,600 well interventions – a 49 per cent jump on 2015 - as the company ramped up its production activities, PDO said.