Oman Is Said to Study Strategic Options for Energy Firm OQ
(Bloomberg) - Oman is currently reviewing options for state-owned energy company OQ SAOC, including a possible IPO as the Persian Gulf sultanate seeks to prop up its finances.
The government of Oman has spoken to potential advisors as it is considering alternatives to OQ, which according to the population could include selling an interest in the company or one of its subsidiaries. OQ could be valued in the billions if it chooses to list, people said, asking not to be identified because the information is private.
OQ is an integrated energy company with oil and gas exploration and production operations, refineries, a retail network and a large petrochemical company. It was formed through the merger of Oman Oil Co. with several companies including the state-owned Oman Gas Co., the Orpic refining group and the chemical producer Oxea.
The government has been looking for ways to tame its budget deficit and stabilize an economy hit by last year's drop in oil prices and the coronavirus pandemic. It has pushed through reforms, including spending cuts, cutting government offices and introducing plans for an income tax.
Oman is the Middle East's largest crude oil exporter outside of OPEC, pumping around 700,000 barrels a day.
The nation had already discussed a listing of Oman Oil in 2019. The deliberations are at an early stage and Oman could choose to keep the current structure of OQ, according to the local population. Representatives from the Department of Energy and the OQ of Oman did not immediately respond to requests for comment.
Oman is also trying to raise money from another state-controlled energy company. According to Bloomberg News, the sultanate could issue around $ 3 billion in bonds through Energy Development Oman this year. EDO holds the government's 60% stake in Block 6, one of the largest oil reserves in the Middle East. JPMorgan Chase & Co. is advising the government on its options for EDO, said one person aware of the matter.
(Updates to oil production in Oman.)
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