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STS Wins PDO Framework Agreements – Major Step Forward for Omanization

STS Group has secured two long-term Framework Agreements with Petroleum Development Oman (PDO), viz. the Project Delivery Contracts (South PDC) and Maintenance Integrity Contract (North MIC) for major Oil and Gas projects. Significantly, these new contracts will require STS to develop and employ over 200 new Omani Nationals per year, representing significant opportunities for Omani employment.

The signings took place at an official contract awards ceremony at PDO’s Mina al Fahal headquarters, which was attended by PDO Managing Director - Raoul Restucci, and STS Group Managing Director - Alex Clark and Chief Executive Officer- Rejeesh Mani.

Restucci said: “These strategic agreements create a win-win culture for PDO, our partner contractors, and Oman, in that they maximize capital efficiency, generate multi-million-dollar savings and enhance In-Country Value (ICV) opportunities. They represent a benchmark of best practice by capturing the lessons learned over the past 17 years from engineering, maintenance, and construction contracts across our concession area. We expect to transition seamlessly from our existing on-plot deals in the coming months, working hand-in-hand with AIP and STS to deliver a large portfolio of projects safely, responsibly, and efficiently. Considering the sheer size and dimensions of these contracts, embedding such improvements within 15 months of the tendering period during the COVID-19 pandemic is an outstanding achievement.

“I congratulate and thank all those responsible for bringing these agreements to fruition, as they will generate exceptional value both for our Company and the country.”

Alex Clark, Managing Director, STS Group said: “These landmark contracts mark a new level of collaboration between PDO and STS. It builds upon a long-standing relationship which spans more than three decades and encompasses a significant number of projects undertaken in Oman. Most importantly, the award of these contracts represents a major step forward for development and employment of the local workforce. In collaboration with PDO, STS will be developing Omani’s at all levels of the contract organization from the site workforce to the contract leadership and management. The award of these contract will ensure STS can build further on its impressive and dedicated track record of National growth and training”.

These contracts are awarded for 7 years with an additional 3-year optional extension. The scope of these contracts is mainly divided into four major services; a) Integrated Project Services, b) Integrated Support Services, c) Management Services and d) Maintenance Services.

The key deliverables for these contracts in terms of projects and maintenance are:

  1. Greenfield and Brownfield EPC projects
  2. Civil and Electrical infrastructure projects
  3. Road Construction, Maintenance and Repairs
  4. GRE, CS, DSS pipelines & Flowlines
  5. FCP, PSM and Integrity projects
  6. Preventive and Corrective maintenance of various equipment including storage tanks
  7. Specialized secondments

Rejeesh Mani, Chief Executive Officer, STS said: “This is a major milestone in the recognition of STS Group Engineering, Procurement, Construction & Maintenance services delivery capability. We have a strong track record with PDO and are delighted to have been awarded these contracts under the long-term framework agreements. The mix of intellectual capital, investment in human capital, field knowledge, proven HSE and Quality Systems, ICV initiatives, trained Nationals across the board, established industrial facilities and camps as well as our large fleet of sophisticated construction equipment makes STS a key differentiator as a service provider.

We look forward to continuing to demonstrate our commitment to a sustainable and long-term presence in the Sultanate through the safe and timely delivery of these projects for PDO”

Ibrahim Al Khusaibi, General Manager HR & Admin, STS said:Under our current EMC contract, we have engaged over 2,000 Nationals. We recruit, train and develop Omani Nationals as well as utilise and develop local service providers and vendors. We are focused on maximising the local supply chain & resources and working as an integral part of the local community”

STS along with Tebodin & Partner LLC in Oman, part of Bilfinger, have been working for PDO under Engineering & Maintenance Contract (EMC) contract since 2011, providing engineering, construction and maintenance services, procurement support to PDO’s oil and gas field development in the North of Oman.

Petroleum Development Oman (PDO) is the leading exploration and production company in the Sultanate of Oman. PDO delivers the majority of the country's crude oil production and natural gas supply. It is a majority state-owned company, with Royal Dutch Shell the second largest shareholder.