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Liwa Plastics Project to Create 12,000 Indirect Jobs

Source: Oman Observer 11/8/2016, Location: Middle East

The $6.4 billion Liwa Plastics Industrial Complex (LPIC) project — the Sultanate’s largest industrial investment currently under implementation at Sohar Port — will not only double parent company Orpic’s profits, but will also create an estimated 12,000 indirect jobs in and around North Al Batinah Governorate, according to a top project official. Henk Pauw (pictured), General Manager, said Orpic — the wholly government-owned refining and petrochemicals flagship — will see positive cash flows of around $100 million per month when the LPIC project comes on stream in early 2020.

Speaking at an economic conference held in the city recently, Pauw said the project — the groundbreaking of which was celebrated last month — would create value for the Sultanate not only in terms of the cutting-edge technology that it will bring to Oman, but also in its immense employment generation potential.

At the peak of construction, an army of around 25,000 workers are expected to swarm LPIC’s sites at Fahud, where the project’s natural gas extraction plant will be based, and at Sohar Port, which will house LPIC’s polymer and steam cracker components. Connecting the two sites will be a 300 km liquid pipeline carrying Natural Gas Liquids (C2+) extracted from natural gas and supplied to the Sohar site as feedstock.

Significantly, job creation will be one of the many important payoffs from the project, the General Manager said. Around 750 operators will be hired and trained to run the plant when it is operational. With Orpic maintaining Omanisation at an impressive 80 per cent, the same high level will be applied to the LPIC workforce as well, he noted.

Likewise, the project will create major prospects for downstream investments, support services, logistics, and so on —opportunities that are ideally suited for small and medium enterprises (SMEs) to capitalise on, said Henk. For example, the project’s output of 1.4 million tonnes per annum of polymer will require around 400 shipping containers for daily volumes to be exported to international markets via Sohar Port. “We have intensive discussions to make sure we have those containers — for shipping as full containers and empties on the way back,” he said.

Further, in line with the company’s In-Country Value (ICV) development strategy, around 25 per cent of the contract cost will be retained in-country — opening up hundreds of millions of dollars’ worth in business opportunities for local manufacturers and service providers during the construction phase and beyond.

Listing a number of unique features about LPIC, Pauw noted that the project is one of very few large-scale undertakings in the country that do not have a foreign partner. LPIC, currently under implementation with a capex of $6.4 billion, is entirely government-owned, he said. It is also the first major scheme to be project financed to the tune of $3.8 billion.

At a time when many mega petrochem schemes in the GCC region have either been scrapped or deferred on account of the economic downturn, LPIC is perhaps the only large-scale venture that is progressing towards fruition — an outcome that attests to the project’s commercial robustness, he added.

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