Interview: Mohammed Al Jahwarib
What will be the importance of integrated project management (IPM) in the coming years?
MOHAMMED AL JAHWARI: IPM brings efficiency through a more holistic approach to project execution. In the case of exploration and production (E&P) operators should be focused on the bigger picture and regulatory compliance. The priority should be the integration of funding, planning, managing and monitoring contractors to ensure the smooth execution of government-approved work programmes. Contractors are better equipped and specialised when it comes to any particular discipline. In contrast, the historical trend has been a blend of vague and fragmented strategies.
There are several case studies in which local and international service companies have worked in harmony under the IPM model. The Ministry of Oil and Gas has also been pushing for a collaborative approach with an accommodating tender board that encourages IPM that is inclusive of in-country value (ICV).
In what ways can oil producers maximise the efficiency of enhanced oil recovery (EOR), make projects economically feasible and attract investment?
AL JAHWARI: The majority of E&P companies do not see EOR as a priority. Therefore, it should be tackled at a strategic level. The regulator needs to implement a policy of farming out matured reservoirs from existing operators. This would attract specialist companies to the country, who can identify opportunities based on their appetite and experience. This will create competition, thereby maximising efficiency, attracting investment and improving knowledge transfer.
Does Oman have the potential for significant hydrocarbons discoveries in the future?
AL JAHWARI: My outlook is quite positive. An example is the western portion of Oman, where the Empty Quarter Basin is located. This remains one of the biggest and most under-explored basins in the country. Nothing of significant value has been derived from it, in part due to its vastness and difficult terrain, which makes it a challenging operating environment. To unlock its potential, 3D seismic coverage must be maximised.
Furthermore, acreage sizes and hydrocarbons bearing horizons should be segmented further among operators in order to make exploration and development of the basin more efficient and manageable.
To what extent can E&P companies rely on Oman’s financial markets to secure project funding?
AL JAHWARI: Considering the magnitude of funding needed for E&P, institutional investors and pension funds must drive the market going forward as the investment banking sector lacks appetite and experience for such a level of sophisticated risk. The Muscat Securities Market depends on one or all of these institutions to provide stability and credibility to any E&P fundraising initiative. Therefore, it is currently left to private or international investors to provide financing.
How do you evaluate the impact of the country’s ICV programme, and what else can be done to maximise the industry’s contribution to development?
AL JAHWARI: ICV started with Omanisation; this quickly evolved into local service providers and then stalled with manufacturing. The only significant ICV opportunity in the prevailing market is manufacturing. Unfortunately, this industry requires its own ecosystem and is not something that can be implemented at will.
Moving forward to accommodate manufacturing, ICV can be stimulated through the creation of a performance-based labour market for the local workforce, a reward mechanism for companies that fund viable manufacturing, and research and development initiatives.
Localisation of manufacturing and research and development will align the education system by bridging the gap between academia and industry. This will create a system that is progressive and self-correcting.
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