Oman to finalize next phase of power sector privatization by year-end

With the privatization of Al Rusail Power Company, effected by a formal transfer of shares from the previous shareholders to its new owners, the focus is set to shift to the next phase of the government's path-breaking privatization strategy for the power and related water sector.
Next on the cards for privatization are the remaining generation companies, Wadi Jizzi Power Company and Al Ghubrah Power and Desalination Company, following a process that will emulate the successful privatization of Al Rusail.

Privatization of the transmission company is under consideration by the Ministry of National Economy, while it remains committed to the privatization of the distribution and supply companies sometime in the future. Significantly, the process of privatizing the generating and transmission companies is anticipated to be initiated before the end of this year, it is learnt.
The transfer of ownership of Al Rusail Power Company from the government to the private sector has been hailed as truly ground-breaking.

Mehdi bin Mohammed Jawad al Abduwani, outgoing Chairman of the Board of Directors of Al Rusail Power Company, formally handed over the share transfer documents to representatives of the new owners, SMN Power Holding Company, which last December won the mandate to acquire the state-owned company in a competitive international bid.
"This is the first major privatization of the sector and it sets a sound precedent for future privatizations in the Oman electricity market," commented Bob Whitelaw, Chief Executive Officer of the Electricity Holding Company SAOC (EHC), which previously held 99.99 % of the shares of Al Rusail Power, along with the Ministry of Finance (0.01 %).

"The process of restructuring the electricity sector, in particular the promulgation of the Sector Law and the implementation of the Transfer Scheme, was undertaken to promote private sector participation in the electricity sector and in particular the privatisation of the state owned companies. The privatization of Al Rusail Power Company demonstrates the success of that restructuring process and gives the Ministry of National Economy a robust platform for future electricity sector privatizations." he said.
In privatising Al Rusail Power Company, Oman is once again leading the way in the region as a trailblazer in power sector privatization, says Whitelaw.
"A key point to be noted is that Al Rusail was privatized by way of the sale of 100 % of the shares of an operational power generation company, which is unique in the region."

The Electricity Holding Company, which still owns 99.99 % of the shares of the remaining successor companies created as a result of the unbundling of the power and related water sector, implemented the privatization process on behalf of the Ministry of National Economy.
"The Electricity Holding Company is proud to have played its part in implementing the policies and meeting the objectives set out by the Ministry of National Economy," Whitelaw stated.