‘Oman's oil and gas sector redeployment strategy needs to be reworked’

Muscat: A revision in the approach to the redeployment strategy in the oil and gas sector is needed in Oman, said a top official.
The Sultanate’s redeployment plans, which were introduced a couple of months ago to help save jobs of Omani workers, need to be reworked for effective results, Salim Al Aufi, undersecretary at the Ministry of Oil and Gas, said on the sidelines of an Oil and Gas forum organised by the Oman Society for Petroleum Services (OPAL), in Muscat.
Ministerial decision
The redeployment initiative was brought into place following a ministerial decision in the wake of the declining oil prices. A technical committee was set up and a policy was formulated in collaboration with the Ministry of Oil and Gas, the Ministry of Manpower, and the General Federation of Oman Trade Union.
The policy aims at creating a “safety net” for Omanis in the field of oil and gas. “I think we are faced with a lot of challenges with regards to matching the (workers’) skills to the needs of the market. There is a huge disparity between those who are released from existing contracts and the skill sets that are demanded by other companies,” Al Aufi said.
He also stressed the need to bridge the gap between the expectations of the employees and the jobs available in the industry.
“A lot of the labour force that is released will be the low-skilled type, and the market expects some skills and unfortunately that gap is creating a big problem for us to redeploy with ease. Also, there is a huge disparity between the salaries Omani employees are getting from their current employers, and the salary structure of the new jobs, and that difference is creating a lot of resentment among employees,” he noted.
It is not difficult for the government to find jobs for everyone who has to be redeployed but it is hard to make people accept those jobs, he added.
“We are able to find jobs for everybody but we are trying to convince them to accept the new salaries with probably some bridging compensation for a while and that is very tough. We have jobs but not the kind of jobs that people are expecting, so it is very difficult from that perspective,” Al Aufi explained.
He also said the government might cut oil output levels by 5 to 10 per cent, but only if other major oil producers do the same.
“Oman is ready to cut between 5 and 10 per cent of its output with conditions, and those conditions are that every other producer matches that cut, otherwise we’ll not cut it unilaterally. The strategy is for the Organisation of the Petroleum Exporting Countries (OPEC) to get everyone together and agree that a cut is an acceptable strategy, agree on a percentage and then get some sort of mechanism in the market to ensure that this is happening.”
If the current oil price trend continues, it might be difficult for Oman to maintain the current level of production, Salim Al Aufi noted.
Recently, a decision by the Ministry of Finance said thousands of expats and Omani employees working at state-owned institutions, run with 50 per cent government funding or more, should have a number of benefits slashed.