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News from the Muscat business world

Energy

OETC announces 65 projects

Oman Electricity Transmission Company (OETC) will be carrying out 65 projects from this year to 2016 at a cost of RO237mn, as the company upgrades and builds new facilities to cope with the sultanate's growth.

At a workshop organised by the company to brief contractors and suppliers on its upcoming projects, OETC announced that it has ten projects at the planning stage, seven under design, 13 at the tendering stage, 19 under construction, six commissioned and ten 'energised' projects now have power flowing to them.

Of these projects, 23 are scheduled to be completed by 2013, with 19 to be completed in 2014, nine in 2015 and the remaining five to be finished in 2016. The estimated expenditure for the projects between 2013 and 2015 is RO237mn, RO137mn of which is proposed to be spent in 2013, RO77mn in 2014 and RO23mn in 2015.

Ali al Hadabi, the general manager of OETC, explained that the expansion programme is line with its main aim of meeting the extra energy demands as the country grows.

He said, In support of this strategic objective, we will be continuing with a programme of significant enhancement and expansion of the transmission network." All of the projects are part of the Main Interconnected System (MIS) of northern Oman, comprising of the areas served by Muscat Electricity Distribution Company, Majan Electricity Company and Mazoon Electricity Company.

Mohammed al Mahrouqi, the chairman of the PAEW, also said the new projects "will of course improve the resilience of the networks in Oman, and also help in meeting the growing demand in the electricity sector." The projects include new grid stations in Misfah, Nakhal and Wadi Sa'a, extra transformers in Wadi Kabir, MQ, Barka, Ibri and Mawaleh.

Banking

Ahli Bank to launch Islamic banking

Ahli Bank will open Islamic banking branches across Oman under the Al Hilal Islamic Banking Services brand as soon as the Central Bank of Oman (CBO) gives its approval to start Sharia services, according to executives. To be launched with an initial minimum capital of RO10mn, as stipulated by CBO, the branches will provide the full range of Islamic banking services and will be fully segregated from the conventional branches.

The Al Hilal brand, launched by Ahli Bank's strategic partner Ahli United Bank, currently operates in the United Kingdom, Qatar and Bahrain. Also present at the event was Al Hilal's Sharia four-member supervisory board for Oman, which includes prominent scholars from around the Middle East.

Dr Ali Moheydeen al Quradaghi, professor and chairman of the department of jurisprudence and its principles in the faculty of Sharia law and Islamic studies at the University of Qatar, has been appointed chairman of Ahli Bank's Sharia board. The other three members are Professor Abdul Aziz al Qassar of the University of Kuwait, Dr Fareed Hadi from the University of Bahrain and Aflah bin Ahmed al Khalili.

Abdulaziz al Balushi, CEO of Ahli Bank, said the bank will launch Islamic banking branches as soon as it gets the go-ahead from CBO. "We are ready with our internal systems to start Islamic banking operations. All the business related to Islamic banking and finance will be covered by Al Hilal Islamic Banking."

Balushi said that the introduction of Islamic banking will ensure "a very competitive environment" in the sultanate, adding that the bank has recruited certified Islamic banking professionals and trained 36 employees. He added, "We will strictly follow the required conditions of the Sharia board in order to ensure that all operations of Al Hilal Islamic Banking Services comply with Sharia laws. The Sharia Board will work independently and is free to review and comment on all contracts and transactions."

Training

Singapore keen on vocational training

Vocational training and the IT sector are the key themes of discussion for a top-level Singaporean government delegation, which took part in the tenth Singapore-Oman joint committee meeting.

The 17-member delegation comprising of businesses, ministerial officials and Singaporean regional development agencies held meetings at the Ministry of Commerce and Industry (MoCI) and Knowledge Oasis Muscat as it eyes further investment opportunities in Oman.

With companies such as Sembcorp, the company behind the US$1bn Salalah Independent Water and Power Project, already having a significant presence in Oman, there are more than 90 Singaporean companies registered in the sultanate - but the delegation is looking for further opportunities in the IT and engineering sectors. H E Ahmed al Dheeb, the undersecretary of commerce and industry at MoCI, said the meetings are "to jointly discuss how we can co-operate with Singapore and get Singaporean experience in the IT sector especially, as well as in logistics and the industrial sectors. We have also discussed the subject of training."

H E Lam Chuan Leong, the ambassador-at-large and co-chair of the Singapore-Oman Joint Committee, added that vocational training is necessary if Omani nationals are to work on the industrial projects under development around the country.

He said, "Companies from Singapore will work with the Omani companies in all the big projects here. We have had good discussion on vocational training. I personally believe vocational training is very important. Technical and vocational people are extremely important in order to work on these major projects and downstream economic activities that will follow from the implementation of the development plan."

Saud al Nahari, the co-chairman of the Oman-Singapore Business Council, added that the aim of the meetings is also to encourage Omani investment in Singapore, headed by BankMuscat and Oman Oil Company offshoot Oman Trading both opening offices in the city state.

Energy

Terra Nex to develop solar project

Terra Nex Financial Engineering AG, a Swiss global wealth management company in collaboration with Middle East Best Select Fund has announced that it will develop its major US$2bn integrated project to establish solar power resources in Oman within 18 months once the go-ahead is given.

Terra Nex has already secured funds from German investors to invest in the value chain project, which includes a series of solar power stations, a solar panel factory, a factory to produce aluminium frames for panels and an educational institution for renewable energy sector.

The solar power stations will be set up in different parts of the country as per the approvals from the government authorities, while two factories will be based in Duqm. David Heimhofer, the Terra Nex chairman and managing director of Middle East Best Select Fund, said that apart from the manufacturing of panels and training institute, the project aims to generate 400MW electricity annually.

He said, "Once we get all the approvals, it will take nearly 18 months to finish the project. With investors providing the necessary investment of approximately US$2bn, in which US$600mn will be direct equity capital and the remaining covered by loans from European financiers, this project will be a boost to Oman's economy. "

Terra Nex and Middle East Best Select Fund have agreed with the local partner, Sheikh Hilal bin Khalid al Maawali, the former Minister of Civil Services, to offer 40 per cent of the project's capital for the general public through an initial public offering (IPO) in the future.

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