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Oman Petroleum Development Company announced that its strategic plans to achieve the raising of Omanisation rates from 79% today to at least 90% in 2030 AD, the company continues to support Omani youth by providing job opportunities and aims to provide 21 thousand jobs for Omanis During the year 2019 in the oil and gas sector and outside, whether in contracting companies operating in the sector or through training opportunities coupled with employment, the number of jobs that have been created has reached 65 thousand jobs since 2011 until now.
The company pointed out that one of its strategic priorities is to increase its production sources from renewable and sustainable energy so that these sources represent about a third of its production by 2030 and there are partnerships with the State General Reserve Fund in solar energy projects, and this approach by the company is in line with the clean and renewable energies strategy it adopts The Sultanate, and this represents a strategic importance for the company, which is also seeking to expand its fields of work in the future, so that it is inclusive of all energy, not just oil and gas.
STP Strategy
STP is a strategic framework that sets out the three main dimensions of the company’s current strategy: segmentation, targeting, and positioning. The current PDO strategy was analyzed by looking below:
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Segmentation Strategy
The segmentation strategy of PDO is dependent on the demographic segments as the company has been focused on manufacturers, refineries and other industries located within Oman and outside. This demographic segmentation includes the various areas such as Mina al Fahal(company based), Qalhat and Sur ( company supplies fuel to Oman LNG). This demographic segmentation also includes the customers as Government Gas System which is responsible for supplying fuel to most of the power stations in Oman. However, the company has also gone beyond its territorial borders in terms of demographic segmentation; for instance, the following figure shows raw oil export destinations of PDO:
Target Strategy
Target market strategy of PDO is associated with B2B customers located in different parts of the world. The company targets its customers through its high tech drilling producing high quality of raw oil and natural gas. The main concern of the company should be its higher dependency on government and with the economic diversification, the target market strategy shifted from premium prices of raw oil to lower prices causing lower profit generation of the firm. The company has also targeted its customers through EOR (Enhanced Oil Recovery) technique while considering the challenging and complex nature of Oman’s geology. The level of economic stability and lower crude oil prices have also shown the decrease in company’s exports to other regions; hence limiting the target market within Oman’s oil and gas industry.
Positioning Strategy
PDO has positioned itself in the market by being a government corporation and because its shares are owned by Shell and Total. The agreement between Omani Government and Total has been outside the PDO’s framework. the company has continued to have a focus on renewable energy as well as water management. For the customers operating within Oman such as Government organisations, the company has maximised the local good’s improved and procurement its capability and capacity of becoming a sustainable organisation.
For this purpose, the In-Country Value has been regarded as the way of retaining total expenditure and stimulating economy productivity. The company has gained a competitive advantage by positioning through its 35 new projects of social investments and Nimr Water Treatment Plant . One of the most resourceful positioning strategies of PDO has been its investments in its liquid bulk storage in Oman which has become attraction for the firms in USA. However, future concerns associated with the company’s unique selling offers are greatly affected by Sell as well as the company’s dependence on the government due to sudden changes in the company’s pricing strategy, operating strategy and international presence.
Marketing Mix
The marketing mix is defined as a marketing tool used for analysing the current strategy of the organization in the market (Johanson and Mattsson, 2015). According to the application of 4Ps of marketing for PDO, it has been identified that the service/product strategy of the organisation is associated with the production of the natural gas and crude oil and the use of latest technologies for the purpose of exploration. The pertinent economic conditions highly impacted pricing strategy of the firm. There are two main dimensions of pricing strategy; one is the diversification of the economy and the dependency of the company on the government. Due to both the dimensions, the prices of natural gas and crude oil have been kept low in the market.
After application first two elements of marketing mix, price and product, the third element is placed and it is identified that since PDO is a government-based organisation, most of its services and products are being offered within Oman. The company has also been engaged in exporting crude oil to other countries, however, most of the profit is generated through Oman. However, it must be noted that the company has faced various issues regarding government policies such as deterioration of public finances in Oman that forced the company to turn towards debt markets. However, it must be noted that the company has faced various issues regarding Oman government policies such as deterioration of public finances that forced the company to turn towards debt markets. The company has also been engaged in promoting its services and products and various strategies. Zawya (2018) has identified that PDO has been organising exhibitions and fairs through its subsidiaries in order to showcase its services and including power and energy resources amongst the customers.
Finally, the Strategy review takes place in early February of each year. This forum is primarily to allow Asset Managers and MDC to re-assess PDO’s existing strategy against any changes in the business environment which have taken place in the past year. It results in revised Guidelines and Objectives that are proposed to the March Board
