Oman explores strategic options for state-owned energy firm OQ

By Shilpa Annie Joseph, Trainee Reporter
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Oman is reportedly considering options for state energy firm OQ, including a possible initial public offering (IPO), as the sultanate tries to shore up its finances.

According to reliable sources, the Omani government has been in contact with potential advisors as it considers OQ’s options, which include selling a share in the company or one of its subsidiaries. OQ could be valued in the billions of dollars if it decides to pursue a listing.

OQ is an integrated energy company with oil and gas exploration and production operations, refineries, a retail network, and a large petrochemical business. It was founded by the merger of Oman Oil Company with several other firms, including state-owned Oman Gas Company, refining group Orpic and chemical producer Oxea.

Oman has been looking for ways to reduce its budget deficit and stabilize an economy that has been hit hard by low oil prices and the coronavirus pandemic. The sultanate, which is outside of OPEC, the largest Middle Eastern oil exporter, has pushed through reforms including cutting spending, slashing government jobs, and introducing plans for an income tax.

Earlier, the government has explored the possibility of Oman Oil being listed in 2019. Deliberations are at an early stage, and Oman could elect to keep OQ’s current structure, the sources said. Oman’s energy ministry and OQ representatives did not immediately respond to requests for comment.

The sultanate is also looking for funding from another state-owned energy firm. The sultanate may issue around $3 billion of bonds this year through Energy Development Oman (EDO), as per the reports.

Related: Oman’s PDO inks $4bn worth service contracts with two regional firms

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