Oman energy company OQ Exploration and Production to offer 25% in IPO
Energy company to float 25% on Muscat Stock Exchange, offer quarterly dividend
Dubai: Oman's OQ Exploration and Production will be listing on the Muscat Stock Exchange after an IPO that will see it offer 25 per cent. The process is scheduled for October.
The company's is Oman’s largest 'pure-play' oil and gas exploration and production company and the only wholly-government owned upstream oil and gas operator.
The IPO will provide 'investors exposure to a Top 3 oil and gas producer and one of the largest holders of reserves in the Sultanate', says the company. It has been expanding its average daily production 'nearly 14 times from its inception in 2009'.
The OQEP portfolio includes joint venture partnerships. "The company has been the partner of choice for international oil and gas companies that explore and develop hydrocarbon resources in Oman," the statement adds. (The company will pay a pre-IPO dividend related to H1-2024 of $300 million. In this period, it made OR427.9 million as revenue and OR176.1 million as profit.)
How much will retail investors get?
The retail tranche represents 40 per cent of the total issue size. Retail investors in the Category II offer will be assigned as 'either a large retail investor or a small retail investor depending on the size of their subscription amount'.
A portion of the Category II Offer will be earmarked to large retail investors and the remainder of the Category II Offer to smaller aspirants.
"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," said Ashraf Hamed Al Mamari, Group CEO of OQ.
"OQ Exploration and Production - with its leading position in maximising Oman's natural resources - underscores our focus on sustainable development and local value creation."
It was in October last year that another entity from the group, OQ Gas Networks, had its own listing on Muscat Stock Exchange. At the time it was the Gulf state's biggest IPO in nearly 20 years.
Dividends for 2025 and '26
For the next two financial years, the Company expects to pay quarterly dividends representing:
- A base dividend equivalent to approximately OR230.7 million ($600 million) per annum;
- A performance-linked dividend equal to 90% of expected free cash flow, plus net proceeds from any potential asset disposals minus the base dividend. (For this purpose, 'free cash flow' means net cash flow from operations minus capex (which includes any potential investments in oil and gas and the exercising of government participation rights).
"Our strategic goals, aligned with Oman’s Vision 2040, focus on monetising the country’s hydrocarbon resources while supporting the energy transition," said Ahmed Al-Azkawi, CEO of the company now heading for a listing. "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."