At the forefront of Oman’s plastic pipe supply

Oman

Ahmed Al Barwani, CEO of Muna Noor Manufacturing & Trading, talks to The Energy Year about how the company has built a strong position in Oman’s manufacturing sector, its strategy for future expansion and the growing local demand for anti-corrosion technologies. Muna Noor manufactures a broad range of plastic pipe solutions.

How has Muna Noor positioned itself in the domestic manufacturing sector?
As a manufacturer, we work across multiple sectors, including oil and gas, infrastructure, irrigation and telecommunication. In oil and gas, our market share for the production of HDPE [high-density polyethylene], uPVC [unplasticised polyvinyl chloride], multi-layer HDPE pipes, fittings and plastic fabrication is more than 40%.
Muna Noor is a company devoted to the best quality standards. We are one of the only Omani companies to have joined Saudi Aramco’s non-metallic standard, with a widespread use of thermoplastic and thermosetting material, which highlights the trust big companies have in us. We are 100% confident that we can provide customers with high-quality, locally manufactured products that they will use for the next 50 years.
In high-temperature applications, the technology was introduced to the market about five years ago. However, it has only been in the past year that we have seen a significant increase in demand. New products like high-temperature pipes have helped position Muna Noor at the forefront of domestic supply.
We are further investing in similar products to enhance our capabilities in manufacturing, looking also at Yemen, Iraq and Africa to export these products.

What are the main opportunities and challenges relevant to the company’s next initiatives to enhance its position in the local market?
All the new investments and new plants that Muna Noor plans will add something new in terms of technology, allowing us to present a more diversified service and products portfolio. We know the market and which kinds of investments are needed to fill its gaps.
In addition to new investments and expanding our product catalogue, we are constantly looking for optimisation-oriented solutions. A great example of this approach today is seen by looking at the production capacity of our assets not only from a classic tonnage perspective, but also at how we can use those assets for different purposes and applications. The more options, the better, because it means that our machines’ capacity is fully exploited.
In terms of challenges, Muna Noor and the entire manufacturing and commodities sector continue to struggle securing long-term contracts, which has significant ripple effects throughout the local economy. The business environment can be highly volatile, which complicates planning in advance because you simply don’t know where the wind of demand will blow, and it can be very risky to buy a large volume of material that, eventually, might end up unutilised. This is why, in a small market like Oman, we proceed on a month-by-month basis when it comes to buying the material, while basing our activities on a four-month forecast.
Unlike in oil and gas, where the manufacturer generally deals directly with the end user, our business often relies on collaboration with the consultants and contractors, which is not an ideal situation particularly with regards to payment and is one of the reasons why we are lagging behind expectations in terms of market share in infrastructure.

What is your assessment of the demand for and main advantages of applying anti-corrosion technologies in Oman?
Generally speaking, considering also the rising attention to ESG practices, I see an increasing demand for these services because they are commercially more attractive for the final consumers, in terms of both the lower carbon footprint attached and the cost-effective materials used on the assets.
In Oman we have corrosive fluids, either with high water cuts or high H2S content. The maintenance and replacement costs of those carbon steel pipes is high. Hence there are two options: one is to replace them with a similar or higher-grade pipe; the other is to line it, which we do with high-density polyethylene products.
In straight lengths of steel pipes, we are able to insert an HDPE liner directly into the pipe, while for the joints and fittings we offer HDPE roto lining for these highly customised fittings in our facility in Sohar. This allows Muna Noor to be a full solution provider, taking advantage of the cost-effective long-term advantages of steel pipe lining.
We also invest consistently in R&D with new materials with in-house testing and collaboration with the region’s top raw materials suppliers to provide us materials to the specs we require. Muna Noor’s innovation process continues to push the boundaries of steel liner pipes and their applications to provide maximum benefit to the end user.
Given the success of our operations in Oman, we’ve also started selling our products to Qatar, entering the shipping and dry-dock industries with our corrosion protection and rotolining services portfolio.

What are the company’s key added values when it comes to providing technical solutions to mitigate corrosion issues?
Our ability to deliver tailor-made services relies on our close relationship with both the raw material suppliers and the end users. We really excel at talking to the end user and this is our competitive advantage. Once you talk directly with them, you know precisely what they need, adding value to their activities.
These open channels we have with them, supported by the technical support capabilities we have in-house, allow us to go the extra mile with more challenging applications, especially within the high-temperature field, and beyond the clients’ expectations themselves.

Can you walk us through the key aspects of your strategy for growth?
2022 was for us a year of recovery and an opportunity to evaluate the company’s position following the pandemic. Throughout the past year, we did not take a single loan from banks and we financed all our operations with our own cashflow, working to cement our position in the market in what we are good at, while at the same time targeting the next growth area.
My vision for growth is very simple: stick to our core strength. We are top-notch in producing plastic pipes, so any future bulk investment is going to be related to that, because once you have a solid basis you will grow stronger. Our immediate approach is to go with small investments, so that if we burn our fingers, we can recover easily. We have already applied this strategy with some products and it worked.
Having said that, we are exploring opportunities to diversify our portfolio away from the traditional plastic piping segment, targeting telecommunications. We have already upgraded our assets, which is faster and cheaper and you get the same results as investing in new ones, and, again, we did this with our own resources. Currently, we are talking with the end users and there is some exciting technology in fibre-optic cable ducts which we are currently exploring. Telecommunication is definitely a segment which we see as one of our major focuses for growth in the future.

Which countries outside Oman are you looking at to expand the company’s footprint?
At the moment we are focusing on the Gulf states, devoting particular attention to Qatar and Kuwait, where we see very good prospects in terms of selling our products. My strategy to penetrate foreign markets is very straightforward and is based on adding value by offering new technologies. A prime example of this strategy is the market for high-temperature and large-scale piping applications. In other Gulf countries there are limited manufacturers for these bespoke products. We were able to enter the market in Qatar, the UAE and elsewhere by offering products and new technologies to meet this growing demand.
We are always closely monitoring Saudi Arabia, but it is a much more difficult country to do business in due to the high number of government regulations in place for importing manufactured goods. Recently we have had very good meetings within the Oman Manufacturers Association and the Oman Chamber of Commerce, who are working hard with the Saudi representative to ease these restrictions with neighbouring Gulf countries. We are ready to invest heavily in the Saudi market once that becomes a more viable option.
Beyond the region, we are looking with interest at East and West Africa and Asia.

What objectives has Muna Noor set for its future and how do you see the manufacturing sector evolving?
The future of the local manufacturing sector is bright and it is one of the most promising segments for the country’s economy, with big room for improvement and employment-related opportunities. The government is doing a great job, implementing solid reforms – backed by positive oil prices – and laying robust foundations for the years to come, which stimulate investors’ appetite to come to Oman.
Furthermore, we highly appreciate its commitment to ensure a reliable supply chain, with measures that ensure each and every player is paid. We are seeing improvement in the economy, resulting in better cashflows for our direct customers, first and foremost contractors.
As far as we are concerned, we have a growth plan for the next three to five years, with three main objectives. The first is to expand to sectors such as telecoms and further penetrate civil infrastructure. The second is to keep up our excellent pace in oil and gas while looking at more challenging applications of our products thanks to our developing technology. And finally, the third is to organically diversify our services portfolio.
I can see Muna Noor growing at least 5% on a yearly basis by implementing this strategy, reaching a 20-25% growth rate by 2028. We want to keep the focus on the big potential in the Omani and regional markets, while further cementing our relationships with our key customers and always keeping a close eye on the future.

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