An estimated 2,100 Omani oilfield workers, who faced retrenchment due to the downturn, have been successfully placed elsewhere within the industry as part of a ‘Redeployment Strategy’ mandated by the Omani government.
Consequently, job losses involving Omani nationals in the Sultanate’s mainstay economic sector as a consequence of the international oil price decline are virtually nil, a top official of Oman Society for Petroleum Services (OPAL) told the Oman Daily Observer.
“What’s emerging is that the Redeployment Strategy is indeed working,” said Musallam al Mandhry, CEO of OPAL, the umbrella body of oil and gas operators, contractors, vendors and related service providers in the country.
“Over the last few months, we have around 2,100 Omani oilfield staff brought to the table (as potential layoffs). So far, we’ve been successful in addressing their employment situations, with all of them having since been redeployed within other oil and gas companies,” he added.
The Redeployment Strategy stems from a moratorium on layoffs of Omani oil and gas workers mandated by the Council of Ministers in a directive issued last November.
It followed threats of industrial action and strike called by the workers union of the oil and gas sector, anticipating large-scale job losses as contractors sought to cut costs in the wake of the oil price decline.
“In fact, we had been working on the Redeployment Strategy since July in anticipation that the oil price slump would have an impact on national employment in this sector,” Al Mandhry said. “This was based on learnings gained from the previous oil price crisis. This time around we expected the crisis to have a longer-term impact; hence the strategy to avert Omani job losses.”
Under the strategy, the operating company in question has ultimate responsibility to ensure that potential layoffs of Omani workers employed by contractors or subcontractors undertaking contracts awarded by the operator are carefully managed primarily via redeployments.
Thus, if a subcontractor is looking to retrench Omani staff, the company should first axe a proportionate number of expatriate staff performing similar tasks. The main contractor in question then does due diligence of the subcontractor’s efforts to redeploy surplus Omani staff within subsidiary companies of the group within or outside the oil and gas industry.
In the second stage of this process, any Omani staff still remaining over from this exercise become the responsibility of the main contractor to suitably place in companies within its group. In the third stage of this process, the operator in question takes responsibility for finding suitable positions for Omani staff remaining over the main operator’s redeployment efforts.
In the final stage, any surplus staff, expected to number just a handful at this juncture, will become the responsibility of a Technical Committee supervised by the Ministry of Oil & Gas which will consider suitably reskilling or compensation options.
Significantly, all 2,100 cases involved staff of oilfield service contractors, according to the CEO. They included 690 employees of TOCO, and around 500 of KEYS Energy.
Placement of staff made redundant by the latter – a US company that wound up its operations in the Sultanate before the strategy was unveiled – was successfully handled by the Ministry of Manpower, Al Mandhry said.
Asked for his assessment of projected Omani job losses in the wake of the crisis, Al Mandhry said OPAL had anticipated around 4,000 redundancies in all. As for expatriate job losses in the industry, he said the numbers were ‘not substantial’, as companies are currently trying to maintain a ‘holding pattern’.
