Oman’s OQ Exploration and Production Plans IPO

OQ Exploration and Production (OQEP), Oman’s largest pure-play oil and gas exploration and production company and its only wholly-government owned upstream oil and gas operator has announced its intention to proceed with an initial public offering (IPO) and to list 25% of its ordinary shares for trading on the Muscat Stock Exchange (MSX).

The subscription period for IPO will commence on September 30 and plans to raise $2.026 billion. At the top of the price range, the company is valued up to$8.104 billion. It has appointed HSBC, Natixis, OIB and Sohar International as joint global coordinators while Sohar International has been appointed as the issue manager, OQEP said on Sunday.

The offering provides investors exposure to a top three oil and gas producer and one of the largest holders of reserves in the Sultanate of Oman. The Company has witnessed significant growth, expanding its average daily production nearly 14 times from its inception in 2009 to 2023.

OQEP’s portfolio includes successful joint venture partnerships. The Company has been the partner of choice for international oil & gas companies that explore and develop hydrocarbon resources in Oman.

The Company has a proven track record of delivering value and growth and has strong cash flows and optimal capital structure supports self-funded growth and attractive shareholder returns.

OQ Group CEO Ashraf Hamed Al Mamari said that the offering marks a significant milestone in their journey towards enhancing the value of OQ’s portfolio through strategic divestments. The intention to float OQ Exploration and Production reflects the company’s commitment to unlock new opportunities for growth, both for the company and for Oman.

“Together with our ultimate shareholders at the Oman Investment Authority, we continue to broaden the reach of OQ companies, offering an attractive and robust investment case to the global market. OQEP, with its leading position in maximising Oman’s natural resources, underscores our focus on sustainable development and local value creation. By empowering local communities and supporting small and medium-sized enterprises, we not only maximise local value but also contribute to the long-term economic stability of Oman,” he said.

Hard Work Pays

Jard OQEP CEO Ahmed Al-Azkawi said that this milestone represents the success of all those years of hard work. The company’s enterprise core values of operational excellence and sustainability have allowed it to build the company.

He said that OQEP is a reliable partner for 13 reputable international companies owing to our significant growth trajectory, robust portfolio of assets, and record-breaking production of nearly 14 times higher since inception.

“Our strategic goals, aligned with Oman’s Vision 2040, focus on monetising the country’s hydrocarbon resources while supporting the energy transition. Additionally, stimulating the local economy is central to our sustainability initiatives, which includes developing local talent and supporting our CSI projects to increase our contributions to In-Country Value. We continue to build on our success and invite investors to be part of this unique opportunity and successful journey,” he added.

The completion of the Offering and Listing of the shares to trading on the MSX is expected in October 2024, subject to market conditions and obtaining relevant regulatory approvals in Oman, including approval of the Listing.

The Company expects to pay the first dividend distribution of approximately $150 million in or around December 2024 in respect of Q3 of 2024 and approximately $150 million in or around March 2025 in respect of Q4 2024, equivalent to an annualised dividend payment of approximately $600 million.