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Oman oil bids could need nationalisation clause

Contractor bids in the oil and gas sector have to account for Omani redundancies if a proposed rider is approved by the Sultanate's authorities

OPAL is proposing the rider in light of recent industry-wide job cuts. [Representational image]
OPAL is proposing the rider in light of recent industry-wide job cuts. [Representational image]

Omani authorities are considering a rider which would require contractors to compensate nationals made redundant during the tenure of a contract. 

The rider, if included, will apply to government-issued construction and procurement tenders. 

The move is currently being considered for the oil and gas sector's tenders, owing to the numerous job losses in the Sultanate's energy industry. 

Contractors, while allocating for these redundancies, may either seek additional insurance cover for their local staff, or bill these costs to the client as a part of their overall bid. 

Oman Society for Petroleum Services (OPAL), the umbrella group of oil and gas firms in the country, is in charge of the proposal. 

The move is reportedly aimed at ensuring bidders are able to factor in potential financial liabilities if they have to lay off Omani workers during a contingency, such as an economic crisis. 

OPAL is "leading deliberations" with Oman's oil and gas sector to gain their views on the idea, Oman Daily Observer reported. 

It is yet unclear as to whether this rider, or a similar stipulation, might be applied to the Sultanate's construction contracts as well.

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May 11, 2019