Omani terrorist arrests in UK. Plus, Government Gas contracts: When you've gott'em by the balls... Twist.

Breaking News: 3 terrorists were nabbed in the UK coming from Oman.

3 Arrested at Heathrow on Suspicions of Terrorism
By RAVI SOMAIYA
Published: April 20, 2012
LONDON — Three men have been arrested at Heathrow Airport and held on suspicion of “possessing articles and documents with intent to use them for terrorist purposes overseas,” the police said on Friday.

The suspects, residents of Britain’s second-largest city, Birmingham, were arrested Thursday night as they arrived from Oman. The police did not release their names.

The three, aged 33 to 39, were detained by officers from the West Midlands Counter Terrorism Unit as part of a “preplanned and intelligence-led” operation, the police said, that was not mounted “in response to any immediate threat to public safety.”

They were held under Section 57 of the British Terrorism Act. That law makes it a criminal offense to possess materials that create a “reasonable suspicion” that they are “for a purpose connected with the commission, preparation or instigation of an act of terrorism.”

A police spokeswoman said British officers had traveled to Oman to meet with the authorities there before making the arrests, but she declined to provide further details about the operation or to describe the articles and documents the men possessed.

Oman, a small Arab nation that borders Yemen and Saudi Arabia, has not previously figured significantly in Britain’s long struggle against homegrown groups of Islamic extremists who have roots overseas. Earlier this week the British government rearrested Abu Qatada, a Jordanian-Palestinian militant preacher accused of being one of Al Qaeda’s leaders in Europe, and said it would resume efforts to deport him.

A couple of other interesting news items over the past few days.

Potential for Shale Gas in Oman?The Ministry of Oil and Gas was touting Oman's potential for the new 'unconventional' shale gas (& oil) plays that are all the rage in the global oil market [a big 'thank you' to the good ol' USA for figuring that out for us, BTW].

It follows the recent expro on Oil and Gas held in Oman last week. Read all about it in the Oman Observer in a press release by His Excellency, Nasser bin Khamis al Jashmi, Under-Secretary, Ministry of Oil & Gas. The Government is desperate for gas, having over built LNG capacity and given away large amounts in gas contracts to stimulate associated industry in Sohar and Salalah. Oxy got the Mukhaisna oil field project mainly because it could bring gas for steam from Qatar, via its Dolphin project.

The Observer also had this cracker of a headline:

Oil and gas expo showcases OER tech[sic]

It seems the ace young Hacks reporters at the Government's news agency can't even spell the 3-letter acronym "EOR" correctly [that's Enhanced Oil Recovery chaps, EOR].


Shale Gas. Not cheap, but there could be an awful lot of it in Oman. At a price.

PDO was quoted as having a $20bln spend over the next 5 years, all of which will need to be paid from production sales. Not included in that cost is the vast amount of natural gas PDO consumes to get that oil. Steam EOR requires gas fired boilers, even if some are from secondary heat recovery units on power stations. On top of the steam, PDO consumes about 700 mega-watts of power, all of it generated by gas.

EOR and fraccing all this unconventional gas and oil is very expensive. Hell, they can't get that to pay in the USA at $3/MMBTU, and that's a country that can drill and frac holes fast and cheap.

The price of oil may well be high enough for PDO's steam and stuff to more than repay, but a market price for gas in Oman (or the region) doesn't exist!

British Gas walked on Oman's Abu Butabul gas find because the gas price was too low. BP are struggling along with the Khazzan gas field, which may pay at $2.50 in places. But in all this the price of gas is a huge issue.

If only the MONE Ministry of National Economy [now defunct] hadn't gaven away loads of gas Oman's gas to Industrialists at dirt cheap rates! $0.77 per MMBTU to the Indians (and yourselves with a carried 50%) for fertiliser; same $0.80 deal for the Wizard of Oz to make Methanol. Even more generous - non-inflating fixed price contracts too! [see the laments of MC passem]

Thus Oman, with no extra conventional gas and rising internal demand to meet power and water requirements, has 20% shut-in capacity in it's 3 LNG export trains as a result. And Japan is gagging for LNG right now. Oman needs more gas* to liquify and send to the Japanese. But looking for the stuff is expensive. And gas supplies are tight. You can't shut the lights off in Muscat. What to do?

The Minister and his undersecretary suggest Foreign Oil companies come in to Oman and invest risk capital to explore for these shale gas and oil deposits, outside the patch of the dominant player (& majority Omani Government owned) PDO and their infamous and productive 'Block 6' concession (The gas is owned 100% by the Government, by the way). After all, there may be opportunities for these companies to strike it rich if the gas price is high enough, and Oman keeps its promises on tax and other fiscal terms. And Oman would get the gas it craves.

Sounds good! Where do I sign?

* Technical Factoid. Selling Natural Gas is different to oil. Most gas is effectively sold 'in the ground' over a long time period. If Oman could be sure of getting more gas from somewhere else in the future, they could 'swap' this new gas for already developed and sold existing gas. Thus the new gas could be immediately sold using existing capacity for the LNG projects and from PDO, plus that would increase oil [condensate] production as an added bonus!

In Other News
It was reported yeaterday that The Ministry of Oil and Gas has decided to break its gas supply contract with their Indian partners in the Oman Fertiliser Plant, Oman India Fertiliser Company (OMIFCO), a joint venture firm between Oman's state-owned Oman Oil Co (OCC) and Indian co-operative firms KRIBHCO and IFFCO. This is a business originally designed as a way to convert cheap, really cheap, gas into Urea for export to India, and to stimulate nearby business and infrastructure. [for reference, $0.80 per MMBTU is about $5/bbl oil equiv.]

The Urea plant & port has already been built and is working, but any extra gas supplies implied as an option in the Gas Supply contract were quickly cancelled after comissioning.

Since then, Oman has now threatened to turn off the taps altogether unless the Indains agree to pay a lot more for the gas - from $0.77 (constant, no inflation) to $3.00 with inflation added every year. Not withstanding the contract signed by the Government to supply long term gas. Surprise!


Photo: The Minister of Oil and Gas renegotiates a Sovereign Omani Non-renegotiable long-term Gas Supply contract. Go ahead, make his day.


As reported in the The Indian Express

Oman cuts gas price to $1.5 per mmBtu, but with riders
New Delhi, Tue Apr 17 2012, 16:33 hrs

Oman has halved the price at which it will sell natural gas to an Indian fertiliser plant in the Gulf nation to USD 1.5 per mmBtu but has added an annual escalation clause.

Oman, which had previously proposed to raise rates of gas sold to OMIFCO's urea manufacturing facility at Sur to USD 3 per million British thermal unit instead of present price of USD 0.77 per mmBtu, has revised its offer to charge USD 1.5 per mmBtu, sources in know of the development said.

The Gulf nation has also set a rider that gas price would be hiked by USD 0.5 every year till it reaches USD 3 per mmBtu.

Oman India Fertiliser Company (OMIFCO), a joint venture firm between Oman's state-owned Oman Oil Co (OCC) and Indian co-operative firms KRIBHCO and IFFCO, produces about 2 million tonnes of urea a year at Sur for exports to India

Oman had contracted to selling gas to the plant at USD 0.77 per million British thermal unit for 15 years beginning 2005 but mid-way decided to hike rates to USD 3 per mmBtu from January 1, 2012 citing firming up of prices in global market.

"Oman has agreed to cut the price to USD 1.5 per mmBtu from January 1, 2012 and under the new mechanism the rate would be USD 1.5 per mmBtu from January 1, 2012, and then the price would be increased by USD 0.5 per year till it reaches USD 3 per mmBtu," sources said.

Fertiliser Ministry has also proposed to the Cabinet to accept the price increase by Oman as it is much lower than the global rates of natural gas.

"We have sent a proposal to the Cabinet that the hike in gas price be accepted," a senior Fertiliser Ministry official had said.

The Ministry argues that even at USD 3 per mmBtu, the gas supplied by Oman is cheaper than alternative fuel sources. Long term gas supplies in the international market are no less than USD 18 per mmBtu.

The official said Cabinet, which may consider the proposal as early as this week, would decide if India should drag Oman to arbitration for breach of signed gas supply contract.

The ministry believes that Oman may snap gas supplies to the plant once arbitration is initiated the OMIFCO would have to buy fuel from international market during pendency of the suit. IFFCO and KRIBHCO holds a stake of 25 per cent each in OMIFCO, while the rest is with Oman Oil Company.

"We are against the proposal of taking the matter to the International Arbitration Tribunal in London, as this could lead to disruption of supply from Oman," the official said.

OMIFCO ships around two million tonnes of urea, which is its entire production, to India under an agreement the country has with the Oman government.

The Indians initially choked, so the Omanis gave them a special discount for a couple of years, while still immediately doubling the price.

Ouch!

I wonder why the Indians didn't get the contract entered as a Royal Decree, which would make it more difficult to renege upon.

It's also a bit sad the way the Indian press headlines the article as a victory for India (Gas Price halves!). They are getting screwed.


Meh. Yanni. Whallah. What to do? We have no gas! Sorry.


If I were some of the other big industrial gas users: Vail [steel plant - needs lotsa gas], or The Wizard of Oz [2 Methanol plants - needs lotsa clean gas], or Alcoa [Aluminium plant - lotsa gas!], I'd be pretty damn nervous right now. Maybe time to do some lobbying and hire some lawyers.


Is this the start of a resource nationalism trend by stealth? Is the Government's policy to negotiate long term contracts in bad faith?





It does not encourage Foreign investors to bring the capital and expertise into Oman, when the agreed and signed legal, fiscal and contractual terms are held at the whim of the Government.

The business environment is bad enough. Oman's courts are already a minefield for outsiders. Employment law is a micro-managing mess biased toward the Oligarchs. Education is poor. And wasta is a huge tax on SMEs. Infrastructure isn't everything.

Is this what happen's when HM goes on vacation?

Inflation continues to accelerate in Oman.

The problem with using any single number to describe inflation is that is a simplification of a hugely complex problem. In this case, the ‘official’ Oman consumer price index annual inflation is at a record high of 12.4%, according to Reuters earlier this month.

But that March increase of 1.2% for the month represents an annual rate of 15.4%. Wow. I know I didn't get a 15% payrise this year. Did you?

The impact of this inflation on people is highly variable. It essentially depends on what your personal pattern of income and consumption is. If a year ago you spent 70% of your disposable income on food, and you only got a 5% pay rise, then due to inflation you have experienced a drop in disposable income of more than 33%. Equally, if you are a landlord who successfully put up your rents, and you only spend 10% of your income on food, you’re in much better shape.

If you used to send all your disposable income to relatives abroad, they will experience inflation and exchange rates as a real double hit: the sender has less disposable income due to inflation, and what little is left is worth even less due to the drop in the value of the US dollar, and hence the rial. Plus the same inflation is occuring back home, so the smaller amount that you send is worth even less! That’s why the second story below is of real interest to Oman – its not just about the headline inflation rate, but the effective drop in remittable funds that counts as the real driver in NRIs value proposition. And that has been a much, much higher drop than just 12%. In may cases, there is no longer any effective income to send back.

Its hard to imagine that the recent price inflation will be sustained: food prices must eventually peak, and then the inflation (which is a rate of increase) will decrease. Hopefully the fall in the dollar too will stabilize. Here’s hoping…

But Oman needs to look carefully at maintaining a relative incentive to keep the mid-level expats here, because the whole local economy is still almost totally dependent on those semi-skilled foreign workers.

And if you haven’t given your maid a pay rise this year, I urge you to do so this month. It should be a minimum of around 25%, and depending on how long since she last got a rise, perhaps over 50%.

Food spurs Oman inflation to fresh record in April
Reuters Jun 16 2008 14:8
Inflation in Oman accelerated to a record 12.4 percent in April as soaring global food prices and rents intensify price pressures across the world's biggest oil-exporting region.

Food, beverage and tobacco costs -- which account for almost a third of the consumer price index -- jumped 21.6 percent in the year to April 30, the Omani Ministry of National Economy said on its website on Monday.

Rents also underpinned the index's 11th straight monthly rise, surging 16.2 percent in April. Oman's consumer price index hit 122.1 points on April 30 compared with 108.6 points a year earlier, the data showed. Prices rose 1.2 percent over March.

Inflation is accelerating across the Gulf Arab region, where most countries, including Oman, peg their currencies to the ailing dollar, which is driving up import costs. But currency weakness is only part of the problem, accounting for about a fifth of inflation guided largely by high global commodity prices, Oman's central bank chief, Hamood Sangour al-Zadjali, said in February.

Prices for cereals jumped 36.7 percent and milk and milk products 30.4 percent in April, the data showed.

"What happens next depends very much on global food prices and the U.S. dollar," said Monica Malik, a regional economist at EFG-Hermes investment bank.

"Inflation in Oman and the wider Gulf will remain elevated going forward as strong economic growth increases demand, particularly for housing," she said.

Zadjali has repeatedly said Oman is committed to keeping a dollar peg that has helped it attract foreign investments. But forward rates show investors betting the Oman rial could rise 2.7 percent in a year.

The impact...

FEATURE-Rising Gulf inflation could push foreign workers home
DUBAI, June 18 (Reuters) - Lured by tax-free jobs and cheap living, foreign workers have long gravitated to wealthy Gulf Arab states to earn a better living, but rising costs are now forcing many to go home.

Inflation has soared to record or near-record levels across the Gulf Arab region, where migrants ranging from high-paid Western executives to low-wage Asian labourers have formed the backbone of oil-fuelled development since the 1970s.

Already pinched by rising rents and salaries, firms are finding it increasingly hard to recruit staff to countries like the United Arab Emirates, the Gulf trade hub where wages paid in the dollar-pegged dirham have eroded the value of remittances.

Inflation helped drive Indian journalist Stanley Carvalho to end a 10-year sojourn in the UAE this year to rejoin his family.

"The cost of living in the UAE, particularly Abu Dhabi, has been rising steadily, led by soaring house rents... Salaries haven't risen commensurately. So... if I had to move my family from India to the UAE, my savings would be meagre," he said.

"Also, as in the case of most Indians, we are hit by the rising Indian rupee against the U.S. dollar. Given the dirham's peg to the dollar, our remittances to India are now lower by at least 8 to 10 percent in value. A double whammy so to speak."

With economic growth of 9 percent, India now creates more jobs at better pay, prompting skilled workers to stay home.

While Gulf Arab economies are reaping a windfall from a near seven-fold surge in oil prices since 2002, analysts say soaring inflation could undercut rapid economic growth.

"The pace of growth of the economy is going to be limited by inflation ... Qatar and the UAE have difficulty bringing in workers from India because their salaries will be eaten away by high inflation and high rent and they won't be able to send money home," said one Middle East consultant.

PRICE PINCH
In the UAE, foreigners comprise over 80 percent of the population, which includes 1.5 million Indians alone. Migrant workers dominate the population in Qatar and Kuwait too.

Manual labourers are feeling the pinch most acutely, their wages now scarcely enough to feed families back home. Last year, the mainly Indian and Pakistani labourers building the sky-scrapers of Dubai rioted to demand more cash.

Yet inflation, particularly in rents, is making life harder even for Western white-collar workers who came to Dubai to save.

"The price I am paying I could live in central London," said Henry Charles, a Dubai-based British business consultant. "It's eroded the financial incentives to move here. I've had to dip into savings at various times to meet rent cheques."

"It works out for people who get a housing allowance that reflects the rental market but in my case my housing allowance doesn't cover the cost of renting a room in a shared villa," he said.

Expatriate parents say school fees are rising fast too and Middle East employment portal Bayt.com found almost two-thirds of employees in the Middle East and North Africa think their salaries are not rising fast enough to keep up with inflation.

Rental increases have forced Qatar, Oman and the UAE to impose rent caps. The UAE government has also agreed with some supermarket chains to freeze prices on a range of foodstuffs. Expatriates worry that plans to introduce value added tax across the Gulf by 2012, and talk of a tax on luxury goods ranging from yachts to cigarettes, could tip the balance.

The saving grace for Gulf countries, say expatriates, is that inflation is biting just as hard elsewhere. Even after the credit crunch, British property prices and taxes are daunting to many Britons who enjoy the sun and glamour of Dubai.

"It is getting more expensive. You are not saving any extra money. I pretty much live hand to mouth," said Tariq Ali, a British car salesman who moved to Dubai in 2004.

"On the other hand I could not afford a big flat with a pool and gym in central London like I can here."

Gonu II continues to be put off, & Maids get a pay rise

More cyclone update. The computer models have now apparently backed off somewhat on the prediction of another tropical storm/cyclone in the next 2 weeks.

BUT, it seems there are signs of dropping pressure, yada yada yada, so the boffins say there still could be one. Its just become less likely.

There is currently some cloud (here's the current Sat Pic), but its not spinning or building cyclonic rotation. So, all OK right now. Don't panic.

And in other news
A coupe of days ago the minimum wage for Indian housemaids in Oman was raised from 50 rials/mnth to 75 rials/mnth, a 50% pay rise, the first rise for 15 years.
Embassy raises minimum wages for Indian maids

MUSCAT The Indian embassy has raised the minimum wage for household workers coming from India from RO50 to RO75.

The new wages will be effective from June 1, 2008, HE Anil Wadhwa, India’s Ambassador to the Sultanate said on Saturday. “This was necessitated by the rising cost of living in Oman and India. The wages had remained static for more than 15 years,” he said.

The wages had been raised in consultation with the Ministry of Manpower, said Wadhwa. The Philippines had raised minimum salary to RO150 per month, Sri Lanka to RO75 per month and Nepal to RO60 per month.

Well, its about time. Maximum hours are supposed to be 10hrs a day, 6 days a week, but thats harder to enforce. In theory that works out to around $1/hr.

Prior attestation of labour agreement by embassy is a must, before the worker leaves India. In association with the Ministry of Manpower, flyers which carry ‘dos and don’ts’ for workers, are placed in aircraft and immigration counters. There are also two help-lines operated round-the-clock by the Ministry of Manpower – 8007-7000 and the embassy – 2469-8491.

It has also been made contractually binding for the sponsor to provide a pre-paid mobile phone to the worker. The housemaid is also required to report to the embassy within four weeks of arrival.

This is all a significant improvement. Now they need to look at the manual workers and do something similar.

India booms, Inflation rages

A few tidbits in the news lately. Sorry, no juicy gossip right now. So its Indian growth, no revaluation, and a booming money supply.

First, India is booming. And this may have some serious implications for Oman.
I’ve already of heard of many NRIs [that’s Non Resident Indians in the jargon, ie Indian Expats] returning to India, both skilled and even labourers, because they can make more money and have a better quality of life in India.
It looks like the old Omani truism "Once Oman didn’t have oil, now we have oil, maybe someday we won't have oil… but we’ll always have Indians!" may be starting to bust.
Some employers are now unable to attract skilled Indian Engineers and other senior professionals at anything near the equivalent Omani wages. While this is good news for Omanis looking for work, it is not so good for Omani Businessmen, long used to an effectively limitless supply of cheap workers in the subcontinent. This is yet another thing to add to the inflationary pressures in Oman.

Employees in India set to strike it rich as wages seen rising 14.4%
NEW DELHI The explosive rate of growth in India has created a phenomenal demand for talent so much that wages are forecast to rise by 14.4 per cent during the year 2008, says a report.

"Wages are forecast to rise by 14.4 per cent during 2008, the fifth successive year of double-digit growth. This far outstrips wage inflation in China (8.6 per cent in 2007) and is second only to Sri Lanka, where wage growth has been driven by high inflation," global management consultancy firm HayGroup said.

The high level of demand for experienced employees is driving wage inflation and creating a culture of job-hopping. Staff turnover of 20 per cent or more is not unusual in high-demand sectors such as the service industry, as talented workers jump from employer to employer, following the promise of even higher wages.

"Reward programmes of companies are in crisis as wage inflation is witnessing an upward spiralling and staff turnover rates hit new highs," the Human Resource consultancy firm said.

"In an environment where employees can achieve a pay rise of between 40 per cent and 50 per cent by moving to a competitor, they are unlikely to stay put," HayGroup added.

In the year 2007, the middle management level witnessed the maximum increase in average annual base salary (16 per cent), while supervisory, senior management and the executive level had an average annual increase of 14 per cent in their base salaries.

No Revaluation for the Rial - CBO
The Government, in its firmest statement yet, has stated that it intends to neither de-peg the rial from the dollar nor revalue the peg. Of course, at this stage its hard to believe the dollar could fall much further, especially in an election year when US dollar almost always rises coming into November. So it probably will make little difference to future inflation I guess.


Dollar peg to stay, says CBO’s Zedjali

MUSCAT The Sultanate has no plan to revalue the Omani rial or to drop its peg with the US dollar, Central Bank of Oman (CBO) Executive President HE Hamoud Bin Sangour Al Zedjali said on Tuesday.

Zedjali told Oman Tribune that a weaker rial helps attract foreign investments and make exports more competitive, which will offset inflation effects. “On the flip side, the falling greenback do have a negative impact on the currencies pegged to it,” he said.

“As a result of the dollar’s weakening, imported goods will cost more whereas the value of the exported goods will go down,” he added.

No shit. That doesn’t really do diddly-squat for the poor in Oman who are forced to buy hyper-inflated rice and oil. The infamous 'Family pack' hardly helps when you don't have the disposable income does it?

Sh. Zedjali continued:

According to the central bank chief, the interest rate policy of the Sultanate is in harmony with not only the economic conditions prevailing in the country but also with the present global scenario.

He said the balance sheets of the commercial banks at the end of 2007 showed total assets surged 42 per cent to RO10.3 billion compared to RO7.2 billion posted in 2006.

Personal loans also increased from RO1.8 billion in 2006 to RO2.6 billion.

Net profit reached RO213.8 million in 2007 as compared to RO162.9 million recorded a year ago.

On the personal loans offered by the banks, Zedjali said there is a limited ceiling of 40 per cent of the total banking loans to the personal loans. “Housing loans also shall not exceed 5 per cent of the total loans granted by the banks,” he added.

Again, the key questions go unasked and unanswered with Oman's totally vapid reporters, sorry, 'copy and pasters', from what passes for Oman's Fourth Estate. For Example, some questions I'd like to see asked:
If personal loans have increased by almost 50%, but are capped at 40% of total loans [by value I assume], what is the current level of loans vs the cap?
What’s the exposure of the banks’ assets to a fall in the raging Muscat Stock Exchange?
If Oman is booming while the global economy is looking weaker (thanks to high oil prices, huge subsidized investments and a stock-market and housing bubble in Oman, with the USA financial collapse) how exactly can a USA-based loose monetary policy, being applied defacto in Oman, be in harmony with all these conflicting forces? Oman’s money supply growth is already running over 40%, so is the CBO happy with that, and does it not see this as a significant contributor to domestic inflation? If the CBO is not happy with the record growth in the money supply, what is the CBO planning on doing about it, given that it has already admitted that it is not able to control Oman’s Monetary Policy?


Oman's annual money supply

17 Mar 2008 Oman's annual money supply, an indicator of future inflation, grew 40 per cent in January, its fastest pace in at least three years, the Ministry of National Economy said on Monday.

M2 hit $16.52 billion on January 31, compared with 4.54 billion rials a year earlier, the Ministry of National Economy said in its monthly bulletin on its website.

That is the biggest rise since at least December 2005.
Inflation accelerated for a seventh straight month to a 16-year high of 8.29 per cent in December, the latest available figure.

Oman, which pegs its rial to the dollar, relies heavily on imported food and has been hit by rising prices as the US dollar slides against major currencies. (Reuters)

Oman Waste Water Company capitulates to the Chinese

I meant to blog about this a couple of weeks ago, but got distracted.
Anyway.
Oman Waste Water Services Company had a press conference where they announced that they had re-engaged the Chinese company SinoHydro to continue the massive waste water project. The details are here Times of Oman Article

Work on Muscat Wastewater project to resume next month
Tuesday, November 13, 2007 12:14:23 AM Oman TimeMUSCAT — Work on the Muscat Wastewater Project, which was stopped temporarily after the June cyclone, will resume next month, the Oman Wastewater Services Company announced yesterday. According to Omar, like all large-scale projects, technical problems are almost inevitable. Work had come to a halt in some parts of the Bausher area. The current difficulties are relatively minor and temporary, particularly in the total context of the project.

“Sino Hydro Corporation which had been contracted to lay the pipeline network remains committed to the long term interests of the project and I am happy to announce that we have reached a solution and agreement with them. I can confidently tell you that work will be restarting by the end of the year,” Omar disclosed to the press.

Great. I was a bit disappointed however than none of the crack reporters present seemed to think of asking some real questions. Like, ‘Can you tell us what happened to all the Indian and Nepalese workers SinoHydro abandoned when their management fled the country in June?’
As reported here News Post India Article
and here in the excellent (and Dragon recommended)News Brief Oman

Or questions like: ‘How much extra did Oman Waste Water Co have to pay to get the Chinese back, seeing as no-one else would touch the contract with a 10 foot pole? Or, Why are you now paying extra money to a contractor that has a recent history of both completing work at poor standards, abusing their workers, bringing in illegal Nepalese workers, and of fleeing the country and their responsibilities when things got difficult? Or, What is OWSC doing to make sure the previous mistakes are not repeated?

No, instead all we got was the usual moronic re-printing of the press release that flatters OWSC with no mention of any of the real story. Well done Times of Oman.

SinoHydro did its runner after cyclone Gonu trashed a lot of their original work and OWSC decided not to entertain any compensation. Perhaps OWSC should have made sure that SinoHydro had insurance against such events. Or awarded the contract to a decent company in the first place. But when it was clear to SinoHydro that the contract was flawed, they literally left. All SinoHydro Senior management got on a plane and flew back to China. Leaving everyone in limbo. Anyone who has experience in contracting knows that you never want to take on someone elses work once they’ve started. The liabilities are too great.

So it seems SinoHydro had OWSC by the balls. Now, as a result of the flawed contract, and OWSC incompetence, SinoHydro are back, on improved terms, and with no apparent penalities for their previous behaviour. OWSC management are still in their jobs, and probably planning holidays to Switzerland to see the gnomes.

Actually, I made that last bit up – I have no evidence whatsoever that the fantastic team at OWSC have done anything improper at all. Because that just wouldn’t make any sense at all, would it?

We all know who will have to pay for this – the Oman Government, and the people who will again have to deal with dug up roads all over the Capital not finished properly. Good work OWSC!