The monthly newsletter for Petroleum Development Oman staff and its Contractors

Page

4 Staying The CourseMD/TD TalkPage

6 Sea ChangeNew Marine OperationPage

8 United On Cost ControlContractor Engagement

Issue - 434APRIL 2015

A MAN OFINTEGRITY

PDO joins the people of Oman in welcoming His Majesty on his return to the Sultanate.

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Features

First WordDear Colleagues,

I am sure you are as delighted as I am by the return of His Majesty to Oman. It is difficult to find the words to fully express personal and collective feelings about His Majesty’s homecoming – but we all feel thankful and re-energised. The recent celebration across the Company to mark His Majesty’s return was truly joyous and uplifting and Al Fahal will be covering it in full with a special supplement next month.

In this edition, the magazine keeps up the focus on cost control by reporting on the successful contractor engagement event which has yielded a wide range of efficiency ideas which could save PDO – and Oman – many millions of dollars. It is still early days but this response from our key contractors is both promising and welcome and vindicates our approach of working collaboratively with – rather than mandating – them to optimise expenditure.

There is also a report on the latest MD/TD Talk which was chaired by Amran and I and emphasised the importance of us all joining together to pursue savings and value creation. Since the event, and despite the economies we have announced, I’ve been heartened by the positivity shown by many staff who fully appreciate the importance of building a more cost-conscious culture, especially as the uncertainty over the global oil price shows no sign of abating.

In this tough environment, I’d like to draw your attention to the story about the operational excellence of our Nimr and Bahja assets which have just achieved the highest ever rating given by Shell globally for their work on unscheduled deferment management. This feat is a shining example of continuous business improvement, with optimum resource deployment for production optimisation and asset availability, all while safeguarding life cycle asset integrity.

As these pages show, our excellent Front End Engineering and Design (FEED) Office is also contributing to this continuous business improvement journey. Staff are currently engaged in the first Lean project in the Project Delivery value stream aimed at accelerating the FEED execution of a mid-sized project by 10-15% through better use of process resources, without compromising HSE.

As you all know, safety is the foundation of everything that we do and it was pleasing to see the enthusiasm and energy which so many of you showed during the annual Safety Day which focused on the second Golden Rule: Intervene. However, please let’s not forget that the obligation to intervene if we witness at-risk or non-compliant behaviour is not just a 24-hour commitment but one that lasts each and every day of the year.

Last but not least, a word for the subject of the Staff In The Spotlight feature, Nasser Al Bahlani, who became the third winner of the Dr Abdulla Al Lamki Award for Developing Talent at this year’s PDO Excellence Day. Nasser is an outstanding mentor, admired by his colleagues, both past and present, and I’m delighted his excellent work in counselling, guiding and inspiring so many of his workmates has been justifiably rewarded with the prestigious DALTA trophy.

Regards,Raoul RestucciManaging Director

Banat Oman Takes Off ................................ 1

A Fitting Farewell ............................................ 1

Staff In The Spotlight ..................................... 2

Feed For Thought ........................................... 3

Staying The Course ....................................... 4

Operational Excellence ............................. 5

E-Claim System Pays Off ........................... 5

Sea Change ........................................................ 6

Ensuring Asset Integrity ............................... 7

Recruiting Omani Talent ............................. 7

United On Cost Control ........................... 8

Wellness Walk .................................................. 8

Growing ICV ..................................................... 9

ICV Boost ............................................................ 9

Online Auction Success ............................10

Tech Talk .............................................................10

To Intervene: Your Right, Your Responsibility ...................................................11

Editor:David BrownTel: 24673977PHotoGrAPHY:Mohammed Al Mahrezi Tel: 24675283

ArABiC Editors:Saleh Al Alawi Tel: 24678901 Zahran Al Ruqeishi Tel: 24678508Ikhlas Al Waili Tel: 24676891

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Email: editors@pdo.co.om

PDO joins the people of Oman in welcoming His Majesty on his return to the Sultanate.

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PDO’s social development project, Banat Oman, has signed a commercial agreement with Muscat Duty Free to produce and supply high quality handicraft merchandise.

The enterprise, set up by PDO to offer vocational training to low-income women, will supply mini “his and her” dishdasha design pouches containing superior quality frankincense. The pouches are the first Omani handicraft products that meet the strict quality standards of Muscat Duty Free.

The agreement will mean international travellers will be able to buy the gifts duty-free on Oman Air flights and the aim is also to supply them for sale at Muscat International Airport. It is the latest in a series of retail deals for Banat Oman products across the Sultanate.

Hanan Al Rumhy, PDO’s Social Investment Adviser, commented: “We are proud of the women working for the Banat Oman project. The quality of the products they produce through their hard work, dedication and commitment enables

us to negotiate on their behalf and market them with leading retailers, as in this case where they can take their place among the other world-class products offered by Muscat Duty Free.

“In addition to creating direct income for the women, this project is also benefiting their families and their neighbourhoods as they can pass on their skills to others and provide a sustainable economic boost to their communities.”

Tom Byrne, Muscat Duty Free General Manager, said: “We continuously strive to offer our customers a range of authentic locally sourced products and the Banat Oman dishdashas are the first Omani handicraft products we are honoured to supply to our international customers. We believe this product has a good story to tell, as it satisfies many modern travellers’ requirements in its offering of a cultural and natural heritage product that educates as well as supports local communities and women in particular.”

More than 200 women have so far been trained through the Banat Oman project in skills

Three members of staff who devoted more than 40 years to championing the importance of fitness and health in PDO and the wider community have been thanked and celebrated for their dedication.

Nunu Al Aufy, Samira Al Rawahi and Naila Al Rawahi are retiring from the Company after a combined total of 102 years of service.

During that time, they worked unstintingly behind the scenes in the Fitness Section of the Ras Al Hamra Club, ensuring better facilities and equipment for members, and support for a number of key health promotion drives, such as campaigns on cancer, diabetes, and Down’s syndrome.

The three women were given a farewell lunch at a special event attended by Managing Director Raoul Restucci, People and Change Director Ibtisam Al Riyami, Oil North Director Abdulsattar Al Murshidi, Corporate Health, Safety and Environment Manager Mohamed Al

Salmani, External Affairs and Communication Manager Suleiman Al Mantheri, and Ras Al Hamra Recreation Club President Khalid Khabouri, as well as other colleagues.

Finance Manager for the Infrastructure Directorate Nahya Al Suleimany, who spoke at the event, said: “One of the underlying reasons why these campaigns have been such a success is quite simply through the efforts of these ladies who really did persevere through countless push backs and rejections over the years.”

Head of Accounts Payable Nunu, who supported the Fitness Section for 20 years, was singled out for helping revamp the ladies' gym and Mina Al Fahal swimming pool, with dedicated swimming days for women, organising charity occasions and arranging with her finance team for food to be auctioned during fundraising events.

Learning Project Manager Naila, who devoted 14 years to the cause, was praised for steering

health campaigns, organising external speakers, engaging contractors and collecting and donating funds to non-governmental organizations, such as more than RO 70,000 to the National Association for Cancer Awareness.

And HSE Learning Support Samira was applauded for her charity work and arranging children’s activities over a 10-year period.

Nahya said: “Thank you all on behalf of the Fitness Section of the RAH Club and all of those who have benefited as a result of your commitment, hard work and spiritual awareness.”

Raoul paid tribute to the trio’s loyalty and wished them continued success and health.

He added: “What I have found particularly special is every time I have joined a fitness engagement there was so much buzz, so much pride, so much energy and enthusiasm.

“Thank you for your continued support. Whether you are pensioners or not, we expect you out there and continuing to help us!”

Former Head of the Medical Laboratory Ali Al Mandhari, another key fitness campaigner, said the three ladies were “pillars for the Fitness Club.”

Naila, who also played a leading role on the Diversity and Inclusion Committee, said: “The people I have met, the experiences I have shared – these are things that I will remember and cherish. I will miss you all dearly. I am consoled by the fact that retirement is not the end. It is just a new beginning.”

A FITTING FAREWELL

BANAT OMAN TAKES OFF

such as tailoring, embroidery, dairy and bakery product manufacture and camel bone carving. PDO funds the training courses and facilities and offers marketing and business support. A further 20 will join the scheme to manufacture the dishdashas for Muscat Duty Free.

One of the Banat Oman members, Faiqa Hamed Al Harrasi, testified to the success of the initiative, saying: “Working has increased my confidence by developing my creative skills. I am now able to supplement my family’s income and have a sense of independence.”

A focus for Banat Oman in recent months has been to establish a strong retail network for its broad range of products. The LuLu Hypermarket and Al Fawaris Bakery chains have both placed orders for cheeses for their shops in Salalah and Muscat. The five-star Rotana and Juweira resort hotels in Taqah are also supplied with Banat Oman products, including dairy and bakery goods, souvenirs, staff uniforms and bed sheets.

Samira, Nunu and Naila with MD's wife Kim Restucci

1

Head of Materials Integrity Nasser Al Bahlani was a popular winner of the Dr Abdulla Al Lamki Award for Developing Talent (DALTA) at this year’s PDO Excellence Day for his work mentoring younger colleagues.

Nasser received 58 nominations and grateful colleagues – both serving and former PDO employees – even made a campaign video singing his praises to support his candidacy.

Here, he talks about his history at PDO, his thoughts on mentoring younger staff and his happiness at winning the DALTA.What is your background at PDO?

I have been working for PDO for over 30 years, starting as a welding engineer before progressing through a number of positions in Materials, Corrosion and Inspection (MCI). I have also worked in quality assurance/quality control, pipeline maintenance and corrosion management systems and have been an active player in the development of the discipline since 1996.

I have championed and overseen a number of technology deployments, many of which are firsts in Oman and even in the industry, such as the large expansion in the use of non-metallic materials, use of state-of-the-art corrosion monitoring technologies, qualification of corrosion inhibitors, utilisation of various cathodic protection technologies and recently the major improvement in corrosion management strategies to support Company process safety initiatives. In 2005, I became Corporate Function Discipline Head and UEOC.What is involved in your current job?

The main purpose of our existence as material and corrosion specialists is to provide the Company with the enablers and the assurance that our assets are designed, constructed, operated and maintained at the lowest life cycle cost and the risks remain as low as reasonably practicable (ALARP) throughout their operational life. For this we are involved throughout project cycle. The MCI engineer’s decisions are extremely important and also support other disciplines from subsurface and civil engineering, including pipelines, mechanical static and rotating equipment, water management, maintenance and production operation. Having the enablers such as the specifications, technologies and, most of all, the competent talents to deal with the ever-increasing challenges manifested by extremely complex projects and ageing facilities, has mandated us to build an MCI centre of excellence, possibly one of its kind among major oil and gas outfits.

How did you feel when you were announced as the DALTA winner?

Overwhelmed. As the saying goes, a journey of a thousand miles begins with a single step. It was an idea from the team leads to nominate me for the DALTA and I was not aware of it. It was even a surprise for me to be contacted by the DALTA Scheme Manager (Hussain Al Noumani) and discover that I was one of the top three winners. I am grateful for all the nominations. The most exciting feeling started when my team members gathered around me immediately after the presentation, celebrating the award and the department’s success. I really became stronger and more happy with my team around.How did it feel to be nominated by 58 people – both past and present PDO staff?

Despite the fact that MCI is a small community, I was astonished to know that there had been a wide spectrum of nominators from all disciplines, all assets and projects across PDO and, importantly, after watching the video, from past PDO staff. This honour has given me strong motivation to continue the journey to put in more effort and take the extra step to develop Omani talent and contribute to In-Country Value.How important to you is developing talent?

The PDO objective for developing talent has always been clear in its vision. Developing talent satisfies the needs for employees to make a difference and contributes to the organisation’s success. It drives engagement, productivity, retention and performance. At the personal level I feel proud and satisfied when I see my contribution has helped talented engineers reaching their aspirations.How do you make time for talent in your busy job?

First of all my office is open all the time to my staff and to those from other disciplines seeking MCI advice. I always encourage and support the technical development of Omani engineers through the presentation of technical papers at local and international conferences and technical meetings. I also mentor and coach the new engineers. I have established collaboration with Sultan Qaboos University to give opportunities for developing young Omanis to become more industrially oriented rather than just academic. Several meetings, technical sessions and projects will be held as part of the programme.

I have also promoted and supported the

international technical community like NACE, API and others. Importantly, I have created the Oman section to share talent and exchange knowledge across members. I have frequently invited experts from reputable universities to give presentations and training to young Omani engineers in disciplines related to MCI and established a monthly discipline meeting where a young Omani engineer prepares the agenda and manages the meeting.What are your tips for somebody who wants to develop talent?

Encouraging employees to take ownership of their work, providing development focused on helping them do their job well, and showing them how they can progress in their organisation emerge as the top three learning and development drivers. Other top drivers include investing in learning and development, providing performance incentives, preparing people to move into jobs when they become available, and facilitating discussions about career development.What are the common mistakes that are made when people develop talent?

From my experience, the most common challenge is to find the right balance between project needs for experienced staff and the need to accommodate the development of Omani talent. Is there anybody who has inspired you in your career?

His Majesty Sultan Qaboos for his passion, affection and strong belief in Omani capabilities to build our country.What are your plans for the future?

In order to reinforce our aspiration to form a centre of excellence for MCI, I will continue working to attract, develop and retain Omani talent in the Company with the aim that all our Subject Matters Experts and Technical Experts are Omani before 2018.

I will continue to support the Welding School, which will develop over 400 Omani welders to work in the oil and gas and construction industries in Oman. And I will encourage and support the technical development of Omani engineers through specialisation, industrial attachments and contributions to local and international conferences and technical meetings.

Nasser Al Bahlani (Head of Materials integrity and dAltA winner)

Staff In The Spotlight

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Young Omanis from the Front End Engineering Design (FEED) Office have staged a road show to share the important work they do and to invite young engineers to benefit from the unique experience gained working there.

The office, part of the Engineering and Operations Directorate, was formed in 2008 as an in-house engineering hub to support PDO’s critical, novel, and mega projects such as Rabab Harweel, Yibal Khuff and Budour.

The two-day event showcased the full range of activities provided by the 240 staff, including process, mechanical, civil, electrical, control and automation, and technical safety engineering as well as rotating equipment, project services and management.

Process engineer Rabab Mohammed, the road show organising team lead, said there was a continuous improvement and knowledge-sharing atmosphere in the office which enabled the effective and efficient delivery of projects.

This environment has led to the office developing a “FEED Journey” for process engineers to better understand the links between process activities and deliverables during FEED. This journey has been refined and enhanced and became the first Project Delivery value stream’s Lean project, aiming to accelerate project acceleration and resource use whilst

FEED FOR THOUGHTimproving quality and following HSE mandates.

Mohammed Al Musalami, a member of the Process Lean team, said: “We are aiming to accelerate FEED execution of a mid-sized project by 10-15% with better utilisation of process resources.

“We have set our targets and are continually

monitoring the results during 2015. If we succeed, we will look for new targets to continue improving our business.”

Colleague Rohit Gupta added: “Lean is a behaviour and a mindset. It can be implemented only if everybody is on board.”

Process Engineer Asaad Mahrami said: “The idea of the road show was to let people across PDO know that we are the centre of engineering

excellence in what we deliver and projects, and make it appealing to those who would like to join us. In addition, the process booth visitors commended the extra mile deliverables, such as the Processing Engineering Guidelines.

“In terms of developing Omanis, the dynamic environment exposes young engineers to different challenges that enhance their technical capabilities and skills. In 2012, there were six Omanis in the process team; however, this challenging environment has attracted more Omanis to the FEED Office and we have now grown to 20 in less than three years.”

Technical Safety Engineer Ruwa Al Riyami said: “80% of the FEED HSE deliverables are now being done in-house, with a major focus on identifying risks and hazards in projects and facilities and advising on their mitigation

measures. Where we do use a contractor we ask them to come in to share their knowledge.

“We also examine human factors, optimising the way people can work in a cost-effective and safe manner – do they need a platform to stand on, for example, so they don’t have to overstretch to do something?

“We look at HSE from a more technical viewpoint but offer good on-the-job experience. It is an attractive experience and offers a very bright future.”

3

Managing Director Raoul Restucci and Technical Director Amran Al Marhubi have reiterated the importance of leaving no stone unturned in the pursuit of cost control and value creation.

Speaking at the latest MD/TD Talk, Raoul outlined the state of the global industry in the low oil price environment and emphasised the need for all PDO staff and contractors to play their part in achieving greater efficiency.

Addressing a packed conference room in the BMF, and with thousands of employees tuning in via a live web link, he said there were “thousands of opportunities” to reduce waste but that no short-cuts would be taken and HSE and asset integrity would continue to be overarching priorities.

Raoul insisted the fundamentals of the business were good, that PDO had a robust portfolio and that the Company was still pursuing a growth drive – with momentum building to a production plateau of 600,000 barrels per day by 2019 - despite the prevailing market conditions.

He said: “Our activity levels and spend are 15% higher in 2015 than last year. We are confident in our programme but the oil price collapse provides opportunities for significant cost reductions. We are going to stay the course and we have a number of great opportunities to execute work more efficiently and to reduce waste. The current environment is helping us, enabling us to challenge the status quo.

“Never waste (what some interpret as) a crisis. We need your help and are very receptive to new ideas. Don’t just go to a water cooler and express concern. Play a role and seize the opportunity.”

STAYING THE COURSERaoul pointed out that PDO was also

accelerating well hook-ups and interventions, redeploying abandonment hoists (following the excellent progress over the last two years) for enhancing production restoration and using Lean and well-established practices such as leading Well and Reservoir Management surveillance to maximise production and revenue.

He also outlined how the Company was working collaboratively with its contractors, rather than mandating them, on expenditure optimisation, and Amran gave an insight into the progress which had been made with just one major contractor to cut waste on engineering work which had identified possible savings in excess of US$30 million.

Ideas included routing pipes overground, using narrower flow lines to reduce the amount of expensive anti-corrosion lining, reviewing the number of piping welds which are inspected, leveraging purchasing power, addressing risk allocation and examining the ISO inspection regime to ensure unnecessary work was kept to a minimum.

Amran summed up the approach saying: “Let’s not do anything foolish but let’s stop doing

foolish things.” He further stated there was a trend and opportunity for more in-sourcing and drew attention to the Front End Engineering Design (FEED) Office which had worked on the three PDO mega projects at Rabab Harweel, Yibal Khuff and Budour, adding: “The FEED Office creates incredible value not just for the mega projects, but also for benchmarking and assessing third party bids.”

Raoul said: “We have much to do and there are no plans for forced redundancies. We have presently frozen establishment levels with plans to reduce the workforce to a cap of 7,400 through natural processes, such as retirement and the non-renewal of certain expatriate contracts when they lapse. We also have to step-up our efforts to support Oman and we are on track for establishing more than 7,000 jobs for nationals with our contractor community.”

He closed by stressing that: “None of the prices that the market throws at us will stop PDO. In periods of difficulty and uncertainty, it’s key to get the fundamentals right and our track record and robust business plan enable us to stay the course.”• United On Cost Control, page 8

4

A new user-friendly method for staff to claim business expenses has been hailed a success.

The E-Claim system, which was designed in-house, offers an automated one-stop shop for employees and enables more claims to be automated and approved.

The online process handles all the expense claims raised and verified by employees which were previously dealt with in an interface called Promaster.

However, Promaster had a number of issues including the fact it had been externally developed so the maintenance, support and enhancement were sometimes inefficient and ineffective. It was also not fully integrated with SAP, difficult to use and expensive to run.

A feasibility study was conducted by the SAP (UIIS) team in the Information Management and Telecommunications Department to investigate the possibilities of replacing the system with a SAPphire solution and it was decided to move forward with this recommendation.

Implementing a SAP reimbursement system provides an end-to-end solution – from applying for the claim until the payment is processed - that is integrated in SAPpHiRe.

Other benefits include: • Any technical issues can be handled faster,

more efficiently and effectively and at lower cost

• Improved employee data • Better controls built for most types of claims• Improved user guidance with policy

specification.The E-Claim project was a collaboration

between the People and Change Directorate and UIIS, with the following core members heavily

involved: Project Manager Mayyada Al Mandhari, Core Business Manager Mouza Al Mahrouqi, Technical Lead Salah Al Haddabi, Functional Lead Taimura Al Hashmi, Change Manager Nusaiba Al Hakmani and core business team members Fadiya Al Rawahi and Hanan Al Rawahi.

Head of Shared Services and Process Owner Mouza Al Mahrouqi said: “The introduction of the E-Claim system is a step towards PDO’s effort and focus on continuous improvement.

“Expense claim automation started back in the late 1980s when it was 50% automated to link

payments between HR and Payroll, and in 2005 it was fully automated for both employee claims and the approval process. Now, we have better features under a single staff sign-on and better controls.”

Project Technical Lead Salah Al Haddabi added: “The project was challenging in terms of its technicality and design with minimal consultancy support. Tremendous efforts and time were invested to come up with a design that caters for PDO’s purposes and requirements.

“Even to ourselves, the result is astonishing as we have delivered a robust and scalable application that competes with many world-class solutions. I take pride in this project as it was managed and developed in-house via a talented team of PDO employees. It’s a dream come true.”

Mayyada said: “The E-Claim project was a great opportunity for all project team members to work together in applying their knowledge and experiences in improving the existing processes within E-Claim. All relevant stakeholders were

engaged to ensure that we incorporated all the complex business rules and validations in order to provide a robust and compliant solution.

“Moreover, thanks to the effective change management we were able to avoid impact on claims payment as we transitioned from Promaster to SAP E-Claim. There was great team work amongst the project team members and I am proud to have had the opportunity to manage a project that was implemented by PDO employees with minimal involvement from external consultants.”

OPERATIONAL EXCELLENCE

The Nimr and Bahja assets have achieved the highest ever rating given by Shell globally for improvements in the area of operational reliability

External auditors awarded the clusters a calculative score of 76% for their work on unscheduled deferment management with associated analysis, leadership support and communication which all lead to elimination of repeat and potential failures.

The accolade came after the rigorous application of quality Root Cause Analysis (RCA) and tracking subsequent actions through to execution via Operational Reliability Improvement Process (ORIP) tools and processes.

This approach led to the saving last year of more than 500,000 barrels of oil, which would have otherwise been lost in unscheduled deferment.

The Nimr and Bahja asset teams attained the score by implementing “Blade 21,” a Shell matrix consisting of 15 elements which must be complied with to ensure the business is effective to a high level of operational reliability. These include RCA action tracking, competence, leadership and teams, unscheduled deferment benchmarking and ORIP overdue actions.

Nimr Reliability Engineer Hussain Al Hasni said: “This was about how we identified, prioritised, assessed and analysed risks - such as unscheduled breakdowns, electrical trips, unavailability of water

disposal pumps and nuisance alarms - and how we mitigated their threat to a smooth production operation.

“Our approach was firstly reactive, dealing with and learning from actual incidents; and secondly proactive – assessing what could wrong by gauging the risks and trying to stop it happening before it actually did.”

After rigorous implementation of Blade 21 processes, there was a significant improvement in terms of the reduction in production deferment with 356,000 barrels saved in Nimr and 203,000 barrels in Bahja. Additionally, there has been a step change in the introduction of an enhanced reliability culture, where all involved see great value in a process that can very much help them improve and succeed.

Oil South Director Reliability Engineering Team Leader Daniel Rowlands said: “This is the result of more than two years of collaboration and intensive

focus between the asset teams, the Reliability functional group and also the Global Operational Excellence team. The people involved were critical to the success.

“The challenge now is to sustain this level and even improve upon it. Not only this, but the Reliability function will be rolling out the lessons learnt from the Nimr and Bahja journey to all PDO assets.”

Managing Director Raoul Restucci described the achievement as “another example of operational excellence in action” and added: “I wish to congratulate and commend all involved for their commitment, determination and sterling contribution to this key assessment and recognition – testament to continuous business improvement, with optimum resource deployment for production optimisation and asset availability, all while safeguarding life cycle asset integrity. Truly first class.”

E-CLAIMSYSTEMPAYS OFF

The Bahja team

5

PDO has overhauled its marine operations with a new way of working to increase In-Country Value (ICV) and improve efficiency.

The strategy covers the vital offshore work which ensures that all of Oman’s export hydrocarbons reach the tankers moored at Mina Al Fahal (MAF) port safely and without delay.

The hub, which is operated by PDO under licence from the Ministry of Transport and Communications, deals with up to 500 tankers every year, exporting 300 million barrels of crude oil and import/export Oman Liquefied Natural Gas condensates and products.

The Company has split the scope of the old contract, which started in 1999, into two so that the towing and diving aspects of the operation are conducted by separate operators instead of the same contractor.

The towing is now managed by Svitzer Sohar LLC (Oman) enabling more Omanis to be trained and employed. At present, 80% of the tugboat crews are Omani but there are aggressive plans to reach 98% within three years.

Head of Marine Operations Captain Atiq Ahmed said: “If there is a delay in marine services, it can have a huge impact on our reputation as a competent and reliable supplier.

“At the moment, we have a very good reputation at the MAF port – one of the best in the Middle East – and this contract sustains that.”

The diving, subsurface and maintenance aspect of operations is being run by UAE-owned Bahwan Lamnalco LLC, which has an Omani arm in Muscat. There are six divers and five maintenance staff, all Omanis, who work at depths of up to 50 metres.

The dive and maintenance team inspects, repairs, and maintains the three single buoy moorings (SBMs), subsea and floating hoses and subsea pipelines. The SBMs are connected to the

PDO crude oil tank farm and Orpic refinery by five subsea pipelines which are 2.5km, 3km and 4km in length and laid on the seabed. Tankers are then moored to the SBMs while the oil is loaded using 20-inch dimater flexible hoses.

The revamped set-up includes five new tugboats, including two 75-ton bollard-pull anchor-handling tugs, fully capable of towing a very large laden crude carrier to a safe area in case of engine failure or emergency. The enhanced capability and equipment will improve marine services to valued customers and provide top quartile operations and risk management assurance.

AbdulWahab Al Sabbagh, Category Manager for Engineering and Operations Contracts, said: “We have awarded two contracts to replace the old one but PDO will still manage the entire operation to provide flexibility. This is a competitive arrangement which allows the contractors to concentrate on what they do best.

“As well as streamlining and segmenting operations so they run more smoothly, another key element of the new strategy is a solid

s E A C H A n G Edevelopment programme for Omanis.

“We now have a strong team which can deliver a reliable, safe service, ICV, asset integrity and customer satisfaction.”

Contracts Engineer Boualem Guesraoui said: ” We received a good response from the market and we believe that we got very competitive prices. In addition, we used terms and conditions that are appropriate for the marine industry and a very simple and comprehensive commercial structure.

“All the lessons learnt from the previous contract were captured in the new tender and we hope it will be a smooth and very collaborative journey between PDO and the new contractors.”

Another Contracts Engineer Ismail Muqbali said:” Separating the diving and maintenance scope from the tug boats allowed PDO to test the market and give the opportunity for numerous local diving and maintenance companies to participate. It also helped to secure services at improved terms and conditions, better quality, modern equipment and reduced cost.”

6

7

ENSURING ASSET INTEGRITY

Technical Director Amran Al Marhubi has spelled out the extensive efforts which are being made to ensure the safety of PDO’s assets.

Making a keynote speech to the 10th Annual Asset Integrity Management Summit in Muscat, Amran said: “I am convinced that accepting that we do not know that our assets are safe is critical to making any progress with Asset Integrity. We in PDO accept that we cannot yet say that we know our assets are safe, but we are totally focused to getting there in the next 12 to 24 months and I want to share with you some of the steps we are taking to getting there.”

He pointed out that PDO operations staff had been given a mandate to shut down a facility if manning levels fell below a defined minimum acceptable level and/or the integrity of the facility cannot be assured. He also described how “fishbowl” sessions had been introduced where senior managers visit each site to discuss recent Process Safety incidents with the workforce to gain insights as to why or how similar incidents will not happen again in our facilities.

Additionally, Amran also described how PDO had developed a new project handover process that tightens the deliverables before operations will accept a new facility and instigated an annual “Letter of Assurance” signed by the asset owner asserting that he has made checks and is assured of key integrity parameters, such as compliance

to inspection and maintenance plans, and that observed corrosion rates are in line with design.

Amran told the audience: “Listen carefully to your staff; they have the answers, our role as management is not to second guess but help them implement.

“Secondly this is a journey requiring many small improvements. Do not wait to design the perfect management system. In short, do not allow best to get in the way of better.”

PDO hosted the four-day summit and three members of staff were on the 10-man advisory board: Functional Maintenance and Integrity Manager Rashid Al Harthy, Functional Technical Integrity and Process Safety Team Leader Wahib Buali and Technical Integrity Co-ordinator Waleed Al Kindy.

In his Chairman’s opening speech, Rashid said: “Asset Integrity and Process Safety Management, the need for it and the leadership of it must be properly understood at every level in the organisation – not just among a few dedicated process safety professionals.

“Whilst there is undoubtedly a great deal of debate taking place about process safety at the present time we all need to be convinced that everyone understands and takes full accountability for the part that they must play to assure the safety of our assets.”

The Company’s AI experts also played

prominent role in roundtable sessions at the event, with subjects including the use of Lean in accelerating the execution of integrity projects, operating integrity, understanding the root causes of Tier 1 incidents, delivering ICV and technical integrity through in-sourcing of equipment repairs, and complying with AIM requirements in mega projects.

More than 300 delegates from oil and gas companies at home and abroad attended the summit, which focused on practical solutions for design, technical, operational and leadership integrity in the Middle East

In his speech, His Excellency Salim Al Aufy, Undersecretary at the Ministry of Oil and Gas, said there was a need to reduce production losses caused by unscheduled deferment which had hit oil production by six to seven per cent last year.

He added: “We could have easily crossed the million-barrel mark a year ago, if we hadn’t lost on production due to unscheduled deferment.

“Organisations should be spending more on liability engineers, those who can analyse the data and understand whether a temperature increase is a good thing or bad, or a pressure increase somewhere is going to have a consequence down the line.”

PDO recruiting specialists have attended a popular career fair in the UK to attract young Omanis to work for the Company.

A team of recruitment advisers from the People and Change Directorate was joined by Skill Pool Managers from the Petroleum Engineering and Engineering and Operations Directorates for the gathering at Loughborough University.

The event at was held under the auspices of His Excellency Ahmed bin Said Al Kathairi, Chargé d’affaires at the Embassy of the Sultanate of Oman in the United Kingdom and attracted more than 180 students from different colleges in Britain.

PDO representatives informed the graduates of the required majors for 2015, such as mechanical engineering, chemical and process engineering and geophysics while answering their queries, and giving away power banks as a practical gift to each visitor to the stall.

RECRUITINGOMANI TALENT

There was also a presentation explaining the Company recruitment process and showcasing the different jobs, the development and career ladders, the diverse roles and responsibilities, and the organisational structures of the Petroleum and Operations and Engineering functions.

Petroleum Engineering Skill Pool Manager Nada Al Kindi said: “It was very well organised and it was great to meet talented young Omanis, and some potential future PDO petroleum engineers.

“In addition to explaining the different disciplines they can join, we also took the graduates through the new Graduate Development Programme and explained the international assignments and distance learning opportunities in PDO.”

Operations Graduates & Training Adviser Mohammed Al Mujaini confirmed the significance of participating in the event, which was organised by the UK-Omani Students Advisory Council in association with Loughborough University Omani Students Society.

He said: “It was a great opportunity for us to meet Omani graduates and present to them the type of jobs available in PDO and answer any technical queries raised by them.”

PDO was commended for its participation and financial support with a beautiful emblem at the graduation ceremony held after the career fair. In addition, each representative received a token of appreciation.

7

8

UNITED ON COST CONTROL

PDO has urged its key contractors to identify opportunities to save money to tackle the steep fall in oil prices.

The Company staged a workshop at the Learning and Development Centre with 150 of its main contractors to outline its approach to cost reduction.

The audience of senior contractor executives was asked to submit proposals to cut waste, increase efficiency and maximise revenue. These will be reviewed and implemented as quickly as possible if they are deemed viable and do not compromise PDO’s strict personal and process safety regimes.

During the workshop, Managing Director Raoul Restucci spelled out the current state of the global oil and gas industry and the possible ramifications of the price slump for the Sultanate. He said it was important that the Company stayed the course with its growth plans by focusing on revenue-generating projects while delivering savings wherever possible.

He said: “PDO is trying to identify prudent

economies across the full spectrum of its business in the current challenging environment. This includes working with our contractor community to identify sustainable cost-saving measures and opportunities but without jeopardising the quality of their work or key priorities such as health, safety and the environment and the welfare of their staff.

“We are here to listen, not to mandate, to understand contractor constraints and to co-operate in a mutually beneficial partnership to create value for Oman. Our approach should very much be: ‘Let’s not waste a crisis. Let’s seize the opportunity to create value for both sides.’

“PDO is a fair company and we want contractors to speak their minds. We look forward to hearing about how we can secure greater synergies and jointly develop effective economies on both existing and future contracts with each and every one of you.”

Contracting and Procurement Head of Strategy and Planning Saif Al Harthi said: “Whatever we do should be adding value and

we want to hear all the ideas which will help us to reduce waste and costs in the most effective fashion.

“We still need to deliver our programme for this year and ensure PDO remains a sustainable, robust business for the future and we need to find savings through efficiencies and improvements in our contracts to do this. Collaboration with our contractors is key and we aim to achieve this through an open, honest transparent dialogue.

“Follow-up engagements with contractors are planned, and we will look into our standards, terms and conditions, alternative specifications, efficiency improvements and risk sharing allocation to maximise value and reduce costs.”

Many the contractors who spoke agreed there were opportunities to work together on cost control.

Roel Berendsen, Assistant General Manager, Sales and Marketing, at Oman Oil Industry Supplies and Services, said: “This collaborative approach is absolutely the right thing to do.”

Managing Director Raoul Restucci has called on more staff to participate in the annual Wellness Walk after a lower-than-expected turnout for this year’s event.

Contracting personnel formed the majority of participants on the return stroll to Gate 3 from the BMF car park.

Raoul said: “Thank you to all those who supported this year’s Wellness Walk, although I was disappointed that the bulk of participants were contractors and with few employees.

“The warm-up and walk takes about an hour of your time, offers a great opportunity to meet new people and is a personal commitment from you for a healthier lifestyle. Please try to make the effort next year.”

Other Wellness Walk events took place across PDO's internal locations, including at Harweel.

WELLNESSWALK

8

A new plant has opened in Nizwa to carry out important anti-corrosion work for the oil and gas industry which was previously performed abroad.

The facility will specialise in the application of fusion bonded epoxy (FBE) internal coating to protect carbon steel pipes and fittings from long-term deterioration. It will be responsible for providing internal FBE coating for new construction and asset integrity projects, including pipelines, piping and flow lines, in PDO’s operations.

The workshop will save money and time, reduce road exposure and boost local employment as until now the work has been conducted in Saudi Arabia, the United Arab Emirates and Germany.

In-Country Value (ICV) Development Manager Mohammed Al Ghareebi said: “This new facility will offer significant benefit to Oman and PDO because it will enable important asset integrity pipe coating work to be done in the Sultanate for the first time.

“Having to do FBE work abroad caused transportation and border clearance hold-ups and additional administration. Now, we can ensure that the coating of pipes is done more effectively at a lower cost by Omani nationals with shorter delivery times.”

“This new facility demonstrates PDO’s strong ICV commitment to create more employment for Omanis and underlines the fact that, through

collaboration and team work, targeted goals can be achieved.

“This is another milestone for PDO on the ICV journey towards achieving sustainable development and training a skilled Omani workforce. What can be done in Oman, must be done in Oman.”

The 16,000m2 plant on the Nizwa Industrial Estate took 18 months to build and employs 45 people trained in blasting, coating and other plant operation activities. It boasts a blasting and coating booth, a primer application system, heating ovens, a loading facility, a storage yard and a testing laboratory.

The complex is owned and run by the Arabian Pipe Coating Company Oman LLC, a subsidiary

A major contractor has showcased the significant strides it has made on the Omanisation front at an event attended by senior PDO executives.

Tebodin and Partners, which is the largest engineering company in Oman, has 400 Omanis on its staff, including 330 engineers and designers.

The engineers work on many PDO contracts including engineering, maintenance and construction in the North, and EPCC- Engineering, Procurement and Construction in the Nimr area and Concept Engineering Services.

The company has its own In Country Value (ICV) department which organised the event titled “In Tebodin We Grow” to show its clients, the management, all Omani staff and especially the new Omani recruits the opportunities on offer, including the posting of two promising Omani staff to an office in the Netherlands to obtain international experience.

During the event, about 20 young Omani staff showed their capabilities and what they have learned using an engineering project based on a real case. They have also produced a technical induction book containing the basic discipline knowledge that any new graduate engineer working at Tebodin needs to have.

GROWING ICV

ICV BOOST AS NEW WORKSHOP OPENS

Tebodin ICV and Business Development Manager Mohammed Al Ruqaishi said: “T&P offers various training courses aimed at enhancing technical and business skills. A four-year training scheme has been developed which meets our company’s and most of the client’s needs. Most of the subjects that Omanis are trained in are technical.

“Some training courses emphasise the importance of working independently and being self-sufficient. Our engineers learn how to take ‘ownership’ of their projects and they apply this as they learn on the job. Fundamental skills such as working together to get a project done, the importance of communicating well and the value of being on time are part of the training.”

And the company’s Managing Director Salim Al Kindi “We truly believe in the ICV drive and are committed to training young Omani staff to be the leaders of tomorrow. We were very excited to give the Omanis at Tebodin an opportunity to demonstrate their potential and capabilities. However, we have to admit that developing young Omanis is a challenge within the competitive business world but this is essential to Oman’s future success.”

PDO has approved a provision within existing

EMC contract for four principal engineers to be full- time trainers which will allow Tebodin to provide more attention to the requirements of Omani fresh graduates.

PDO Engineering and Operations Director Abdullah Al Shuely praised the quality of the presentation and the overall event.

And Engineering Project Delivery Manager Julian Masters said: “I was really pleased to have been invited to this event and to have experienced the enthusiasm with which the young Omani staff presented the demonstrator project, drawing out some of the lessons they have learned about the value of good communication, careful design - with its attention to technical safety - as well as overall project management skills.

“One of my visions for Oman and developing ICV in the oil and gas industry, is to move to ‘exported from Oman.’ The fact that two engineers are going to the Netherlands is the very first step for Tebodin. In the tough low oil price world we now find ourselves in, getting better at what we do well and doing the right thing first time will be key to success. I believe that internal Omani development programme will support Tebodin & Partners through the years ahead.”

of APCO Ltd, which is an established pipe coating operation in Jubail, Saudi Arabia.

Abdullah Tannous, General Manager of APCO Ltd, a company which has been operating in the GCC and broader Middle East region for more than 30 years, said: “APCO Oman will cater to local industry in Oman by providing high performance internal and external custom coating solutions for the oil and gas and water industries.

“The facility will bring significant value to the Oman market place as it consolidates supply chains, shortens lead times for project completions and brings technology-based solutions to industry in Oman.”

9 10

PDO has staged its first ever online auction to bring greater efficiency, speed and transparency to the sale of unwanted goods.

A web-based bidding tool was used to successfully facilitate the February sale of scrap materials such as pipes, sucker rods and cables.

The initial groundwork involved setting up the correct e-bidding platform, training the bidders, placing advertisements in prominent newspapers for the lots being sold, pre-registering the bidders by obtaining the requisite certificates and bank guarantees and providing them with the log-in ID and password to make offers on the day of the auction.

The online bidding took place from 7am-4pm and a total of seven bids were received.

The process guaranteed firm submission and acceptance of offers and completely eliminated the lengthy hassles and delays that are normally associated with the usual paper bid submission process, which has now been phased out.

The sale generated revenue of RO 2.1 million, provided total transparency and credibility of the submitted data and also enabled:• A reduction in the bidding and award

process turnaround from 10 days to one• Instant comparison of bids submitted• Time benefits and reduction in paperwork

and postage• A complete electronic audit trail of bids

submitted

• A secure bidding environment• Increased efficiency in the process• The feasibility of submitting multiple bids.

Speaking on the success of the initiative, Head of Procurement Abdulla Al Harthy congratulated his team and FPB5 for working together successfully.

Finance Director Haifa Khaifi also applauded the team saying “This is certainly a key milestone. Thanks to all those involved in making this a success.”

And there were words of praise from Contracting and Procurement Manager Husam Al Jahdhami, who said “This initiative should go a long way to addressing transparency and efficiency issues.”

ONLINE AUCTION SUCCESS

Pigging in the context of pipelines refers to the practice of using devices known as “pigs” to perform various maintenance operations on a pipeline, specifically inspection and clearing.

When a pipeline contains sharp bends and restrictions, pigging becomes a challenge and is not possible using conventional devices. Such pipelines are termed as “non-piggable.” For that reason, the integrity of non-piggable carbon steel pipelines in PDO is currently assessed using the external inspection of axially sampled locations. This involved sometimes digging a small section of a pipeline to place an external inspection device.

However, with advancing technologies, the ability to pig the non-piggable pipelines can become feasible. PDO’s Materials Integrity function team, together with the New

Technology Department, embarked on a technology search followed by a trial to enable a new full-coverage inspection method for non-piggable pipelines. Two technologies were trialled: stress-concentrated tomography (SCT) and the flexible ultrasonic pipeline intelligent pig system.

SCT is an above-ground survey method that has the potential to detect metal loss and other stress-concentrating defects on buried or above-ground pipelines. It is one implementation of a group of methods that are based on measurements of magnetic field variations at a distance of several pipe diameters away from the examined carbon steel pipeline. These are known collectively as large stand-off magnetometry methods.

The flexible ultrasonic intelligent pig

system provides full inspection coverage of conventionally non-piggable pipelines. It is a new implementation of an ultrasonic wall thickness measurement on a multiple-articulated lightweight intelligent pig. Its light weight gives benefits for launching in pipelines without permanent scraper traps while the flexible articulation enables difficult pipe configurations like bends and restrictions to be traversed.

Both technologies were tried in the field and benchmarked against conventional pigging practices. The trials demonstrated that flexible ultrasonic intelligent pigging managed to provide a full coverage inspection for the non-piggable pipelines. However, despite offering a very cost-effective alternative, the SCT technology results were not in line with the benchmark, possibly due to its low maturity, which makes it unfeasible to deploy in PDO fields at the moment.

Tech Talk

9 10

11

All Pdo contractors and staff took time out on this year’s safety day to discuss and debate the importance of intervening, the second of Pdo’s Golden rules.

the teams shared ideas, safety concerns and stories of how they had intervened both within Pdo and their private lives.

Everyone became actively involved and participated in role-playing exercises where scenarios were played out and then groups debated the right and wrong ways to intervene or to receive an intervention when a person had seen someone behaving in a reckless, dangerous or non-compliant manner. these often turned out to be humorous but also had an important aspect of showing the importance of caring for the safety of everyone at all times.

A Pdo film regarding a recent intervention in Yibal was shown which demonstrated the power of intervening, where a contractor was

stopped by a colleague from cutting a live flow line, saving four lives.

Managing director raoul restucci said: “i know it’s not easy, it takes courage. sometimes you receive push-back, and some colleagues may even say ‘it is none of your business’ but it is, it’s your right, your responsibility to intervene because we should all care.”

the sessions relayed useful tips to make a successful intervention, such as pointing out to the person at risk the human, financial and environmental consequences of their actions while ensuring it is done in a polite, positive and respectful way.

the three Health, safety and Environment (HsE) Golden rules – Comply, intervene and respect – are key pillars of Pdo’s aspiration of attaining Goal Zero – no harm to people and the environment.

Corporate HsE Manager Mohamed Al

salmani said: “it is important to intervene if you see somebody acting in an unsafe way and sometimes you may have to change tactics if your initial approach does not work.

“At the same time, it is also important for the person who is approached to react in the right way by listening to any concerns which are raised.

“safety is core value in Pdo and is an overarching priority in everything we do in our operations. our safety performance relies on all of us understanding the basics, such as the rules, procedures and standards and carrying out our day-to-day activities in a safe manner.”

Ways to sustain the focus on intervention were also debated during the sessions and suggestions were made to publicise good examples in the future.

TO INTERVENE:YOUR RIGHT, YOUR RESPONSIBILITY……

11

يوم معها املتعاقدة وال�شركات ال�شركة موظفو كر�س

ثاين التدخل، اأهمية ومناق�شة لبحث العام لهذا ال�شالمة

القواعد الذهبية بال�شركة.

املتعلقة واهتماماتها الأفكار امل�شاركة الفرق وتبادلت

داخل ذلك كان �شواء التدخل كيفية يف وجتاربها بال�شالمة

ال�شركة اأو يف حياتهم اخلا�شة.

الأدوار لعب تدريبات يف بن�شاط املعنيني جميع و�شارك

بعدها املجموعات ناق�شت �شيناريوهات، متثيل مت حيث

الأ�شاليب ال�شحيحة واخلاطئة للتدخل، وكيفية تقبل التدخل

بطريقة يت�شرف اآخر �شخ�شًا �شخ�س ي�شاهد عندما

متهورة اأو خطرة اأو غري متوافقة مع القواعد. ومت متثيل هذه

اأنها اإل والدعابة، املرح روح ي�شيع باأ�شلوب ال�شيناريوهات

اأظهرت اأي�شًا جانبًا هامًا من اجلوانب املتعلقة باأهمية العناية

ب�شالمة اجلميع يف كافة الأوقات.

وقعت تدخل حادثة حول ال�شركة من فيلم عر�س ومت

توقيف التدخل، حيث مت قوة اأظهرت والتي موؤخرًا يف جبال

اأحد موظفي ال�شركات املتعاقد معها عن العمل من قبل اأحد

الزمالء عندما كان يهم بقطع خط تدفق حي، وقد ت�شبب هذا

التدخل يف اإنقاذ اأرواح اأربعة اأ�شخا�س.

التدخل اأن “اأعلم ري�شتو�شي: راوؤول العام املدير وقال لي�س اأمرًا �شهاًل وهو يتطلب �شجاعة حقًا. قد تتلقى ردود فعل

يعنيك ولكنه يعنيك. ل الأمر اأن البع�س يقول قد اأو �شلبية

فعاًل، فالتدخل حق من حقوقك بل من م�شوؤولياتك اأي�شًا، لأننا

يجب اأن نظهر اهتمامنا”.تعلمنا من حلقات العمل هذه ن�شائح واأ�شاليب مفيدة من

اأجل التدخل الناجح، كتنبيه ال�شخ�س املت�شبب يف اخلطر اإىل

العواقب الب�شرية املالية والبيئية الناجمة من ت�شرفاته، طاملا

يتم التدخل بطريقة اإيجابية وباأ�شلوب موؤدب وحمرتم.

والبيئة: وال�شالمة لل�شحة الثالث الذهبية والقواعد

لطموح الأ�شا�شية الركائز ؛هي والحرتام والتدخل اللتزام

ال�شركة لتحقيق الهدف ال�شفري - ل �شرر على الإن�شان ول

على البيئة.

الزميل بال�شركة والبيئة وال�شالمة ال�شحة مدير وقال

�شخ�شًا راأيت اإذا تتدخل اأن املهم “من ال�شلماين: حممد ما يت�شرف بطريقة غري اآمنة، واأحيانًا قد ت�شطر اإىل تغيري

طريقتك يف التدخل اإذا مل ينجح الأ�شلوب الأول الذي اتبعته”.املتلقي لل�شخ�س بالن�شبة املهم من نف�شه الوقت “ويف للتدخل اأن يرد بالأ�شلوب ال�شحيح من خالل ال�شتماع اإىل اأية

خماوف تثار معه”.ال�شركة، يف الأ�شا�شية القيم اإحدى هي “ال�شالمة وحتظى باأولوية �شاملة يف كل ما نقوم به يف عملياتنا. ويعتمد

القواعد مثل لالأ�شا�شيات، فهمنا على لدينا ال�شالمة اأداء

بها نقوم التي والأن�شطة املهام واملعايريوتنفيذ والإجراءات

ب�شفة يومية بطريقة اآمنة”.الرتكيز لال�شتمرار يف الكفيلة ال�شبل مناق�شة وقد متت

اقرتاحات مت وُقدِّ احللقات هذه خالل اأي�شًا التدخل على

لال�شت�شهاد باأمثلة جيدة يف امل�شتقبل ون�شرها.

التدخل:

حق وم�س�ؤولية