Yousuf Al-Busaidi – Decree Blog https://blog.decree.om Tue, 04 Jul 2023 13:37:33 +0000 en-GB hourly 1 https://wordpress.org/?v=6.7 https://i0.wp.com/blog.decree.om/wp-content/uploads/2021/12/favicon-decree.png?fit=32%2C32&ssl=1 Yousuf Al-Busaidi – Decree Blog https://blog.decree.om 32 32 197035704 Regulating the Waterworks—the New Water and Wastewater Sector Law https://blog.decree.om/2023/regulating-the-waterworks-the-new-water-and-wastewater-sector-law/ Tue, 04 Jul 2023 09:41:25 +0000 https://blog.decree.om/?p=914 Back in late 2020, Royal Decree 131/2020 regarding the Water and Wastewater Sector made an unusual reference—it referred to a law that was not yet promulgated, stating that this yet-to-be-issued law would regulate the water and wastewater sector.

Fast forward to mid-2023, the Water and Wastewater Sector Law is finally out and you can read it by clicking on the below link:

Seeking to regulate a wide range of water-related activities, the new law covers not only the desalination and transportation of water, it also covers wastewater-related activities and—to a certain extent—water wells, especially as groundwater in the Sultanate becomes increasingly scarce.

Replicating a Successful Model—the Electricity Sector

The new Water and Wastewater Sector Law shares a lot in common with its older sibling, the Law on the Regulation and Privatisation of the Electricity and Related Water Sector—more commonly known in the industry as the “Sector Law”. With the passage of the Water and Wastewater Sector Law, I suspect the former will be referred to as the “Electricity Sector Law” moving forward, with the latter being referred to as the “Water Sector Law”. For the sake of simplicity, I too will follow this approach.

A considerable number of provisions in the Water Sector Law are quite similar to those found in the Electricity Sector Law. This is by design, as the new law is clearly intended to provide regulatory consistency with the long-established and well-received Electricity Sector Law. These similarities can be seen across the new law, such as in licence-related provisions, usufruct provisions, economic purchase provisions, and even in licence-modification provisions.

This should give comfort to investors interested in building desalination or sewage treatment capacity in Oman, as they would be able to invest in a sector that closely follows the success of the electricity sector, thanks to the latter’s robust and investor-oriented legislation.

This should give comfort to investors interested in building desalination or sewage treatment capacity in Oman.

In a similar fashion to the Electricity Sector Law, the Water Sector Law assigns the role of strategic decision-making to a dedicated ministry, being the Ministry of Agriculture, Fisheries, and Water Resources in this case, while reserving the regulatory role for the Authority for Public Services Regulation (APSR).

To future-proof the provisions of this law, the Water Sector Law also contains a dedicated chapter on market liberalisation, with the ultimate approval in this regard lying with the Council of Ministers. This, too, is similar to the provisions set out in the Electricity Sector Law to enable further liberalisation once the market is ready for it.

Who Buys the Water?

To ensure the continuity of sufficient water supply, the Water Sector Law permits the ongoing practice adopted under the Electricity Sector Law of the Oman Power and Water Procurement Company (OPWP) purchasing water capacity and output from the independent water projects (IWPs).

This is key to the sector, as OPWP supplies the majority of water capacity for the sector, rather than the Oman Water and Wastewater Services Company (recently rebranded as the Nama Water Services Company (NWS)). Nevertheless, the Water Sector Law is flexible as it allows both OPWP and the “working companies” to contract for water, meaning that IWPs may be either contracting with OPWP or one of the working companies, being the Dhofar Integrated Services Company for projects based in Dhofar and NWS for everywhere else.

This ongoing practice of the APSR (and previously the Public Authority for Water (PAW)) assigning this role to OPWP is intentional. It seeks to capitalise on OPWP’s strengths and reputation for transparency and robustness in its procurement of capacity and output, whether this is in the form of electrons or water molecules.

Prior to the new law, unless the project involved generating electricity alongside the production of desalinated water (known in the jargon as “related water”), APSR/PAW could only assign this role to OPWP by designating the IWP as a facility of “special nature” in accordance with Decision 254/2014. This is no longer the case, as APSR has the authority to direct OPWP without the need to abide by the aforementioned decision.

The Monetary Plumbing

The water and wastewater sector continues to rely on government subsidy for its operations and the new law ensures that this is done in a timely manner by placing an obligation on the Ministry of Finance (MOF) that is almost identical to the obligation imposed upon the MOF in the Electricity Sector Law.

Notably absent in the Water Sector Law is the MOF’s obligation to secure the availability of the financing necessary for the operations of government-owned companies, whereas it is clearly set out in the Electricity Sector Law. Instead, this obligation is imposed upon the Electricity Holding Company (more commonly known as Nama Holding) in coordination with the Oman Investment Authority.

The Water Sector Law also introduces a dedicated set of provisions on tariffs, listing in it the key principles that need to be adhered to when determining tariffs, which is not as spelt out in the Electricity Sector Law.

As for the fees that the APSR collects, the approach followed under the Water Sector Law is very much in line with the one adopted under the Electricity Sector Law, with the key difference being that the APSR will now need to obtain the explicit approval of the MOF prior to imposing such fees on the licensees.

Dispute Resolution, Penalties, and Fines

In the same vein as the Electricity Sector Law, no judicial claims can be brought against a licensee without having to first go through the APSR. This ensures that the regulator of the sector can mediate and resolve these disputes during their earlier stages.

In contrast to the Electricity Sector Law, the Water Sector Law ensures that the Ministry of Justice and Legal Affairs (MJLA) retains its relatively-new competence to adjudicate disputes between government entities and other government entities or government-owned companies. The availability of this avenue means that a government entity can—in theory—bring its claim before the APSR, the MJLA, or the competent court, subject to satisfying their respective conditions as set out in the law.

Interestingly, the Water Sector Law makes no reference to arbitration, in stark contrast to the Electricity Sector Law, which went as far as to identify the rules of arbitration that must be followed, being the International Chamber of Commerce rules. Investors keen to retain the arbitration route would have to do so contractually, which may be a concern as the courts of Oman have previously rendered arbitration clauses invalid—albeit in very different circumstances.

The Water Sector Law also introduces some hefty fines where its provisions are violated, reaching as high as 1 million Rial Omani and potentially 2 million Rial Omani in the case of repetition, whereas the fines under the Electricity Sector Law are capped at a meagre 50,000 Rial Omani.

Finally, if a crime takes place under the Water Sector Law, the board and executive management of the companies addressed by this law run the risk of being personally held accountable if they contribute to the occurrence of the crime. This potential liability, while present in the Commercial Companies Law to some extent, is not spelt out in the Electricity Sector Law. One more reason for investors to ensure that they get quality legal services, and by extension, quality legal translations and content.


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Oman Doubles Down on Hydrogen https://blog.decree.om/2023/oman-doubles-down-on-hydrogen/ Mon, 20 Feb 2023 09:27:22 +0000 https://blog.decree.om/?p=605 Just before the end of business last Thursday, the Sultanate issued its first ever royal decree pertaining to the rapidly-developing field of hydrogen. Royal Decree 10/2023 Allocating Some Lands for the Purposes of Renewable Energy and Clean Hydrogen Projects is the first of its kind, earmarking sizable parcels of land purely for these projects.

This decree signals Oman’s commitment to the global fight against climate change and its desire to become a hydrogen export powerhouse. However, it also raises some questions on project risk allocation and the meaning of “renewable” and “clean”.

Adopting the principles of public-private partnership (PPP), this decree intends to bring in private developers, by way of auction, to build projects that use renewable energy for the production of clean hydrogen on the earmarked plots.

It also assigns the responsibility of the auction process, the resulting partnership, and what goes on top (and under) these earmarked plots, to Hydrogen Oman Company—more commonly known as Hydrom.

The Growing Role of Hydrom

Established as a company that is fully owned by Energy Development Oman, Hydrom is central to the government’s strategy of becoming a leading force in the nascent hydrogen industry. While not set out in the decree itself, Hydrom is assigned a wide array of duties, including developing the master plan for this sector, attracting foreign direct investment, managing the common infrastructure, and overseeing the execution of the projects.

Besides the multitude of responsibilities and duties, it appears that Hydrom is also taking on a de facto regulatory role in this space. For example, it alone will manage the auction process (as explained below) without the need for oversight of any other government body.

Going Once, Going Twice, Sold!

The auction process appears to be a departure from the government tendering process set out by the Tender Law and—for PPP projects—the Public Private Partnership Law. The decree does, however, seek to ensure fairness, transparency, and competitive tension by requiring the process to adhere to the principles listed in article IV, which are almost identical to the principles listed in article 5 of the Public Private Partnership Law.

While not set out in the decree itself, Hydrom’s page on the auction process states that the project developers are expected to partner up with state-owned enterprises, to develop projects with a competitive levelised cost of hydrogen (i.e., competitively-priced hydrogen), to demonstrate their commitment to building out local supply chains, and to secure the offtakers (i.e., buyers) of the end-product, be it hydrogen or its derivatives.

Weaving the Supply Chain Fibres

It is clear that a bid committing to taking on a more active role in building out the local hydrogen supply chains will be seen favourably during the bidding stage of the auction. What is less clear is how much of these supply chains are expected to be built out by the project developers, and how much will be borne by the Omani government.

For example, will the government take on the role of constructing and commissioning dedicated water desalination plants that feed water into the electrolysers, or are the project developers expected to build their own desalination capacity?

Where the sought end-product is ammonia, will the project developers build their own ammonia plants or will Hydrom orchestrate the efforts to build large ammonia plants as part of the common infrastructure, with each train perhaps being owned by a different group of companies, as was done in the Atlantic LNG project?

Whatever the answer may be, there appears to be an intention to have these supply chains converge into some form of common infrastructure, used by other project developers in the future. If this is indeed the case, then questions on the ownership of this infrastructure (and, in turn, the project-financing models) will also need to be addressed.

Take the Hydrogen, Keep the Land

Interestingly, article III of the decree states that the earmarked plots are to be granted to Hydrom by way of usufruct rather than ownership, based on a request by the Ministry of Energy and Minerals to the relevant government entity in question, being either the Ministry of Housing and Urban Planning or the Public Authority for Special Economic Zones and Free Zones.

It goes on to elaborate in article IV that Hydrom can divide these plots and contract with the private developers to exploit them as needed. The form of agreement to be adopted for this contracting is unclear from both the decree and information pertaining Hydrom in the public sphere.

It may be the case that a sub-usufruct framework is adopted, as is the case for some projects in the Special Economic Zone at Duqm; a partnership agreement framework, as most recently adopted for the Sultanate’s first 42 schools public-private partnership project; or an entirely different framework altogether.

This, in turn, raises questions on the financing side—it is unclear how project developers will be able to mortgage these contracted plots in the absence of a usufruct agreement to which they are a party.

Follow the Money

Besides generating revenue from the usufruct fees it will collect over the leased-out parcels of land, the government will also indirectly enjoy the dividends generated by Hydrom and the state-owned enterprises that partner up with the project developers for each and every project on the earmarked plots.

Notably, the decree does not assign a dedicated usufruct fee for renewable energy and hydrogen projects. Accordingly, the fees set out in Ministerial Decision 92/2016 would apply, which could be pricey due to the considerable amount of space that renewable projects, such as solar PV, require.

The projects are also expected to bring in considerable foreign direct investment into the Sultanate, which—like a domino effect—will increase Oman’s GDP, which in turn will have a positive multiplier effect on the overall economy of the country. 

Last but not least, the projects will also generate jobs, create local expertise and know-how, and by the imposition of certain Omanisation rates, potentially alleviate the Sultanate’s current unemployment rates. 

Define “Renewable”

Our minds tend to automatically think of solar panels and wind turbines when we talk about renewable energy. This is a reasonable assumption, given the prominence of these two technologies. However, the term “renewable energy” is wide-reaching—it encompasses any form of energy derived from a natural source that is replenished at a higher rate than consumed.

In other words, bioenergy plants, which generate energy from biomass (jargon for wood, charcoal, plants, and poop), and waste incineration plants could potentially also be proposed as projects for the earmarked plots.

A key point to highlight here is that “renewable” is not synonymous with “carbon-free”. Some forms of renewable energy, such as burning biomass, can produce more CO2 emissions than fossil fuels. Waste incineration plants, or waste-to-energy plants, are also CO2-belching plants with a high price tag per unit of electricity. Without carbon capture plants or other solutions to offset these emissions, these projects risk not being aligned with the Sultanate’s goal to be carbon neutral by 2050.

Define “Clean”

The decree does not specify the permitted carbon intensity parameters of clean hydrogen. In other words, it is not clear if hydrogen produced by a combination of renewables and fossil fuels would still count as “clean” or not. 

Take the EU’s recently unveiled Delegated Act—it sets out the definition of “renewable hydrogen” (or “green hydrogen” if we’re following the colour scheme) and states that the resulting hydrogen can still qualify as being “renewable” if a portion of its electricity is sourced from the electricity grid at times of insufficient renewable energy output, provided that an equal amount of renewable energy is injected back into the grid at a later time.

This has upset environment-oriented NGOs, which have slammed the act as “greenwashing”, arguing that the electricity supplied by the grid can come from coal-fired power plants, one of the worst offenders in CO2 emissions per unit of electricity, rendering the resulting hydrogen more “brown” than “green”. Oman, thankfully, does not have coal-fired power plants, but the electricity in its grid is almost entirely generated by gas-fired power plants.

Furthermore, it is not clear if blue hydrogen, which is hydrogen extracted from natural gas with the resulting CO2 being captured at source, would also be considered as “clean” for the purposes of this decree. As this decree revolves around renewable energy, it might be the case that the earmarked plots are restricted to green hydrogen projects only.

Regulating the Gigawatts

As these projects will involve a considerable amount of electricity flowing to produce clean hydrogen, the Law on the Regulation and Privatisation of the Electricity and Related Water Sector will apply, meaning that project developers will have to obtain a licence (or an exemption) from the Authority for Public Services Regulation (APSR) before they can build their respective projects.

Further, if these projects intend to sell some of their renewable electricity into the grid, then in the absence of the liberalisation of the electricity market (as defined in the law), these projects will have to sell their output to the Oman Power and Water Procurement Company, in its capacity as the single buyer of electricity in the Sultanate.

Final Thoughts

This is an exciting time for the hydrogen sector—after several false starts, the momentum appears to be unstoppable this time. However, there are still some key issues that need to be answered before this sector can become a permanent fixture of the energy transition.

While this decree focuses on how hydrogen will be produced, it does not answer the question of how it will be exported. Ammonia seems to be the preferred choice here, but with a poor round-trip efficiency of only 11%, especially if cracked back into hydrogen and nitrogen at the destination port, it is unclear if the economics will ever make sense to ship more than a nominal amount of ammonia to wealthy countries that are willing to pay for the green kind.

Another challenge, which unfortunately is not getting enough attention, is hydrogen’s potent impact on the atmosphere that is ton-for-ton 33 times worse than CO2. Being the smallest molecule in the universe, hydrogen is bound to leak and could possibly cause more damage than the very fossil fuels it is trying to replace. 

Proceeding with an abundance of caution will be key.


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MOCIIP’s New Regulation: Who’s in Charge? https://blog.decree.om/2023/mociips-new-regulation-whos-in-charge/ Sat, 21 Jan 2023 08:14:44 +0000 https://blog.decree.om/?p=539 The Ministry of Commerce, Industry, and Investment Promotion (MOCIIP) recently issued a regulation to determine the “beneficial owner” of companies operating in Oman. This regulation is applicable to all types of companies except for public joint stock companies, which are instead regulated by the Capital Market Authority. The companies in question have until the end of this month to satisfy the provisions of this regulation. So what does this regulation mean for your business?

The Regulation Governing the Procedures for Identifying the Beneficial Owner (the Regulation), which was issued by MOCIIP Ministerial Decision 630/2022, seeks to identify the ultimate natural or legal persons that influence the decision-making process in the company and who own no less than 25% of its shares. It does this by requiring companies to produce and maintain a register of the Beneficial Owner, which must contain all of the information listed out in the annex of the Regulation.

This is remarkably similar to other common-law jurisdictions, such as English law, where companies are required to have a register for Persons of Significant Control.

The provisions of the Regulation are fairly straightforward and should be easy to satisfy before the end of this month. However, failing to do so may result in a violation, which may result in a fine of 1,000 OMR or more extremely a suspension of the commercial register of the company for a total of 3 months.

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Hello Twenty Twenty Decree: We Have Turned One! https://blog.decree.om/2023/hello-twenty-twenty-decree-we-have-turned-one/ Sun, 15 Jan 2023 14:49:01 +0000 https://blog.decree.om/?p=513 Just over a year ago, we launched the beta version of Decree to create a definitive English language resource for Omani royal decrees, laws, ministerial decisions, regulations, and treaties. This month, Decree has turned one, and to celebrate this occasion, I thought it would be appropriate to share a progress report that showcases the considerable amount of content we have made available during the course of 2022, as well as mentioning our ambitions for 2023.

As of the date of this post, we have over 150 standalone laws (with their amendments consolidated) available in full-text in English. We also translated essentially every single royal decree issued in the last 6 years (i.e. approximately 500 royal decrees) and since October 2022 we now translate all the ministerial decisions and regulations published in the Official Gazette on a weekly basis. This is in addition to our growing collection of 600+ treaties made available on Decree.

In 2023, we plan on taking Decree to the next level: Decree is now an incorporated company, we have team members dedicated to working on the project full-time, and we have many ideas for new content and features to be added to Decree over the upcoming months.

The first new major feature to be added to Decree in the upcoming months is Decree Intelligence, which will be a new members-only section that will provide short reports and summaries of key laws, wiki-like pages on various aspects of the Omani government and legal system, and other original intelligence content produced by Decree.

We also plan to start a free Decree Newsletter to provide periodic updates to our followers with details of the latest legal instruments published in the Official Gazette. We plan on starting this newsletter soon, and those interested can add their email addresses to our mailing list using this form.

On top of all of this, we will continue to crank out high-quality translations at a rate that is already unprecedented for Oman and work closely with our users to ensure our services are fully aligned with their business needs.

Thank you for using Decree beta and we look forward to serving you as subscribed users of the biggest and most comprehensive database of English translated Omani laws, royal decrees, and ministerial decisions on the internet.

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Oman Pledges Net Zero https://blog.decree.om/2022/oman-pledges-net-zero/ Tue, 15 Nov 2022 09:11:39 +0000 https://blog.decree.om/?p=354 Back in June 2022, I had predicted that Oman would pledge to achieve net zero by 2050. What I had not predicted was how soon this pledge would come. As you have probably heard by now, Oman has, in the lead-up to COP 27, pledged to achieve net zero by 2050.

This is fantastic news—it demonstrates Oman’s commitments to the objectives of the Paris Agreement and will most certainly galvanise its government and the private sector towards achieving this goal. However, it is also a daunting task that requires a fundamental rethink on how we use energy. Oman will have to take many unprecedented steps to fulfil this laudable goal, so how does it go on about it?

Energy efficiency and electrification

Vaclav Smil said it best—the best thing we can do is to “keep the heat in (or out) with better insulation.” While a lot of attention in this space goes to the more glamorous tech-driven solutions, such as renewables and more recently green hydrogen, the most cost-effective way of addressing this monumental challenge is to simply reduce the demand for energy in the first place. This can be done by improving window-insulation and replacing old home appliances with newer and more energy-efficient appliances, such as new air conditioners.

As for electrification, we are starting to witness this first-hand with the advent of Battery Electric Vehicles (or BEVs) worldwide, such as the likes of Tesla and others. I’m sure you have seen a Tesla or two zooming through the highway during your daily commutes.

BEVs will become more ubiquitous in Oman during the next decade, and with the appropriate government mandates and incentives, BEVs will become the norm. This is very much the case in other countries, such as Norway, in which 75% of all the new cars sold in 2021 were BEVs. Where possible and economically feasible, other sectors should also be electrified, since electrons will always be more efficient than molecules.

Residential solar

Oman is blessed with an abundance of solar irradiation (that’s jargon for sunshine we can use for electricity), which can be utilised to reduce your electricity bills at the end of the month. A framework is in place to permit the installation of solar panels on residences, but the process is unfortunately bureaucratic, time-consuming, and on the pricier end (even though the back-of-the-envelope calculations show that the investment would pay for itself in ~7 years with today’s subsidised electricity prices and ~4 years once electricity is unsubsidised). It also does not address the fact that for rented properties, landlords have no incentive to install solar panels as it is the tenant that foots the electricity bill at the end of the month. So how do we resolve this?

The investment would pay for itself in ~7 years with today’s subsidised electricity prices and ~4 years once electricity is unsubsidied.

Process-wise, streamlining approvals and simplifying where possible would help. As for uptake, introducing incentives can go a long way. For citizens and residents that are barely able to cover their monthly costs, the notion of paying 6,000 or 7,000 OMR for solar panels is simply too expensive. The introduction of government-driven low-interest loans to address this issue would certainly help. Another incentive geared towards landlords could be in the form of tax/fee deductions that incentivises them to install solar panels on their properties. Perhaps in the future, the government can even mandate that all new buildings have solar panels installed.

The government can also offset the costs of such low-interest loans by taking ownership of the environmental attributes resulting from these installations, such as renewable energy certificates, in return, and selling them to buyers keen to offset their own emissions. 

Reliable low-carbon electricity generation

Renewables can only get us so far—when it’s dark and still, there is simply no way to harness the power of renewables. Batteries and other storage solutions, at least with today’s technology, are too expensive to deploy at scale. Oman will need to consider other technologies that can be deployed in Oman that are safe, readily available, and cost-effective.

Nuclear comes to mind as the most appropriate solution here and it appears our neighbours in the UAE have arrived at very much the same conclusion over a decade ago with the Barakah nuclear power plant. For all those concerned about the safety issues with nuclear, I suggest looking at the statistics—when looking at death per unit of electricity, nuclear energy is one of the safest forms of energy by far. Radiation is also an overblown concern. Did you know that your one-way flight from Muscat to London last summer exposed you to more radiation (24 μSv) than if you had been living next to a nuclear plant all-year-long (0.09 μSv)?

Some might gloss over the data and point right towards the Fukushima Dai-ichi disaster. As someone who has lived in Japan and spoken to multiple professors and specialists in this regard, I can write an entire thesis on what exactly went wrong, but the key point to highlight here is that newer plant designs have resolved the underlying issue of the Dai-ichi plant decades ago.

The Dai-ichi plant design was extremely outdated, having been designed in the 1950s at a time with no computers. In other words, this plant was designed back at a time when all they had were papers and pencils! We now have supercomputers with simulations so powerful that developers can pre-empt and resolve all of these issues before they even begin construction.

If Oman wants to emerge as a winner on the other end of the energy transition, it will need a reliable, cost-effective, and low-carbon solution. Nuclear can very much be the solution we need.

Hydrogen hubs

I tend to pour cold water over all the hydrogen hype. The notion that our world will run entirely on hydrogen, from our cars to our planes and all the way to our power plants, is simply unrealistic in my view. But don’t take it from me—Professor Sir David MacKay, Regius Professor of Engineering at the University of Cambridge and Chief Scientific Advisor to the UK government, wrote this in his book, Sustainable Energy: Without the Hot Air:

I think hydrogen is a hyped-up bandwagon. Hydrogen is not a miraculous source of energy; it’s just an energy carrier, like a rechargeable battery, and it is a rather inefficient energy carrier, with a whole bunch of practical defects.

Professor Sir David MacKay

Nevertheless, ‘green’ hydrogen has a critical role to play in decarbonising ‘grey’ hydrogen, especially as demand grows for hydrogen in the future. To ensure that the Sultanate can play a leading role in supplying this demand, it should focus on utilising its industry hubs to act as hydrogen hubs as well. Sohar and Duqm come to mind as suitable hubs for this purpose. This will ensure that hydrogen is produced and handled in a carefully controlled environment that reduces its likelihood of leaking into the atmosphere (which is quite problematic—if you recall from my previous post, hydrogen leakage has a devastating impact on global warming that is, ton-for-ton, 33 times worse than CO2).

I believe the hype over hydrogen will dissipate once consumers are shown the eyewatering prices that they will have to pay for hydrogen. Case in point—there are now 32 independent studies showing why using hydrogen for heating in the UK is a bad idea, especially since heat pumps are inherently safer and much cheaper over the long-run. I expect that we will arrive at the same conclusion for other proposed uses of hydrogen.

Carbon capture

One gas that I believe we should be obsessing over instead is CO2—it, unfortunately, cannot dissipate from the atmosphere fast enough and will need to be hoovered in by carbon capture solutions.

Oman should be obsessing over carbon capture, not to offset its domestic emissions, but rather to offset the emissions of other countries and industries. This is a sure-fire way of bringing in monetary benefits into the Sultanate in a manner similar to exporting goods, except Oman would store the captured carbon on behalf of these other countries.

In this regard, Oman is blessed with an abundance of a rock that is almost non-existent elsewhere, called ‘peridotite’. This rock can permanently store CO2 and preliminary estimates find that Oman has enough of this rock to store all CO2 emitted by humans since the beginning of the industrial revolution (yes, since the very beginning).

This can, in theory, enable Oman to supply fossil fuels to countries that need it the most (i.e. ones that are unable to switch to low-carbon technologies fast enough) and, in turn, supply them with the carbon credits needed for them to offset the resulting emissions from combusting these fossil fuels.

It is still early days, but I believe that carbon capture, as an industry, is here to stay and Oman can benefit considerably from it.

Legal considerations

Moving forward, you will need to ensure that your business carefully accounts for its GHG emissions to understand which segments of the business are at most risk of being impacted by Oman’s net zero pledge. The GHG Protocol is a good place to start if you are looking for an international standard to follow. A shadow carbon pricing can also help in understanding which business segments are at the highest risk of being impacted should Oman adopt a carbon tax in the future.

Further, you can expect dedicated climate impact assessments as a prerequisite for future projects to assess the impact such projects would have on the climate should they be deployed.

For businesses involved in carbon trading with buyers abroad, I would advise paying close attention to the accounting mechanism established by Article 6 of the Paris Agreement, which is known as the “corresponding adjustment”. This mechanism is designed to address the issue of double-counting by requiring the country selling the carbon credits to deduct the sold credits from its own national inventory.

The relevant government entity in this regard, being the Environment Authority after this competence was transferred to it from the Civil Aviation Authority by way of Royal Decree 60/2022, may not be keen to permit such sales. 

I should note, however, that corresponding adjustment only applies to credits authorised for transfer under Article 6 of the Paris Agreement and not to carbon credits sold under the unregulated voluntary carbon market. That being said, I would not be surprised if the main players in the voluntary carbon market (such as Gold Standard and Verra) impose this requirement onto their respective credits moving forward.

Finally, for businesses seeking to offset their emissions in the short-term, I would advise looking into purchasing high-quality carbon credits and renewable energy certificates that are compatible with the GHG Protocol and your respective industry’s climate-related codes. These will help reduce your emissions in the short-term and buy your businesses some time while you explore other solutions that can definitively help reduce your carbon footprint.


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World Environment Day: Decarbonisation https://blog.decree.om/2022/world-environment-day-decarbonisation/ Sat, 04 Jun 2022 20:01:00 +0000 https://blog.decree.om/?p=217 Today is World Environment Day—a day dedicated to celebrating and raising awareness about the environment, so I thought I would write a bit about ‘decarbonisation’: what it is, why we need it, and how we can achieve it.

You have probably heard all the buzzwords by now: net zero, decarbonisation, renewable energy, green hydrogen, and so on. All of these concepts and solutions are meant to address humanity’s biggest challenge: climate change.

I will spare you the write-up on what climate change is and why it is disastrous to humanity if left unchecked, but suffice it is to say that this is a problem of gargantuan proportions that will require many solutions and global cooperation on an unprecedented scale. Thankfully, the world did come together back in 2015 to sign the Paris Agreement. This landmark agreement was the first time in history that almost all of the world (196 countries to be exact) collectively acknowledged the existence and impact of climate change on the world, as well as the urgent need to address it.

Oman signed the Paris Agreement on 22 April 2016 and ratified it by Royal Decree 18/2019 on 24 April 2019. You can view more treaties ratified by Oman on the Treaties section on Decree.

The underlying objective of the agreement, which is sometimes referred to as the Paris Accord, is to limit global warming to below 2°C, with 1.5°C being the ideal target. To achieve this, the parties to the agreement need to reduce their total greenhouse gas emissions to zero by mid-century. In other words, if a country does emit greenhouse gas emissions by 2050, it will need to offset these emissions so that the total resulting emissions are zero. This is commonly referred to as ‘net zero’.

The agreement requires that its parties submit short-term and long-term plans explaining how they will contribute to this target. The short-term plan is referred to as a Nationally Determined Contribution (or NDC), submitted on a 5-year basis, while the long-term plan is given the incredibly long name of ‘long-term greenhouse gas emission development strategy’ or ‘long-term strategy’ for short. This is also commonly referred to as a decarbonisation roadmap.

‘Decarbonisation’ is a bit of a misnomer. When we refer to decarbonisation, we are not only referring to the reduction of carbon dioxide emissions but also the emissions resulting from other greenhouse gases, such as methane and nitrous oxide. That being said, carbon dioxide does take the lion’s share of greenhouse gas emissions as it accounts for almost ¾ of global emissions. Perhaps ‘decarbonisation’ is the right term after all.

Putting aside the naming choice, decarbonisation is imperative for the world if it wants to achieve the objectives of the Paris Agreement. For that to happen, every country will need to do its part by producing a decarbonisation roadmap and following through with its implementation.

“Decarbonisation is imperative for the world if it wants to achieve the objectives of the Paris Agreement.”

Oman has not pledged to achieve net zero by 2050, nor has it submitted a decarbonisation roadmap under the Paris Agreement. It has, however, pledged to reduce its emissions by 7% by 2030 (compared to a business-as-usual model) and to achieve ‘zero routine flaring’ by 2030 as well. There is also a lot of momentum and interest in this subject as of late, so I would not be surprised if Oman pledges within the next few years to achieve net zero by 2050 (or to become carbon-neutral if we are using climate jargon).

Achieving net zero is a monumental task and according to the Climate Action Tracker, an NGO specialising in this field, there does not seem to be any country in the world that has produced a 1.5°C-compatible roadmap so far. With the right policies and incentives, I believe that Oman can achieve this goal.

For starters, Oman does not have any coal-fired power plants, which is the biggest culprit in terms of greenhouse gas emissions, with its CO2 emissions being double that of gas-fired power plants for the same output of energy. Double!

It also has a fairly robust electricity sector that has been deploying several renewable energy projects, with Ibri II Solar IPP being the largest with a nameplate capacity of 500 megawatts. That is fantastic news and will certainly reduce the greenhouse gas emissions resulting from the fleet of gas-fired power plants in Oman.

However, policymakers will also need to look into solutions for when the sun isn’t shining and the wind isn’t blowing. Energy storage springs to mind as an elegant solution, with green hydrogen being at the forefront, but several challenges lie ahead if Oman seeks to transition to the so-called ‘hydrogen economy’.

“Energy storage springs to mind as an elegant solution, with green hydrogen being at the forefront, but several challenges lie ahead if Oman seeks to transition to the so-called ‘hydrogen economy’.”

One of the key challenges with green hydrogen is its round-trip efficiency, which is the percentage of energy retrieved from the energy originally put in. Green hydrogen has an electrical round-trip efficiency of around 30% using current electrolysis technologies. While this will improve in the future, there are some hard limits due to the immutable laws of thermodynamics.

Another concern with hydrogen is its impact on climate change. A recent study has shown that hydrogen that leaks into the atmosphere may cause global warming in its own right that is 33 times more impactful than carbon dioxide (using a measure called the ‘Global Warming Potential’ or GWP).

There is also the fact that while hydrogen used in fuel cells is not polluting, hydrogen combustion—on the other hand—is polluting. Somewhere down the line, the distinction between those two uses of hydrogen seems to have blurred, with many articles nowadays incorrectly claiming that hydrogen combustion is not polluting.

This is not to say that green hydrogen will not play a role in decarbonisation. On the contrary, I believe green hydrogen has a crucial role in decarbonising the gigatonnes of grey hydrogen produced every year.

There are also several promising technologies and solutions on the horizon and keeping a close eye on them would be sensible. Once these technologies have achieved a high level of readiness, measured in Technology Readiness Levels (or TRL), they can then be successfully deployed in Oman as well.

Oman will need to do its part to tackle climate change and I am confident that it has the necessary tools, resources, and capabilities at its disposal to achieve this. Deploying them to their fullest extent will be key in this transition.

“There are also several promising technologies and solutions on the horizon and keeping a close eye on them would be sensible.”


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Qanoon Update: Court Judgments https://blog.decree.om/2022/qanoon-om-update-court-judgment/ Tue, 19 Apr 2022 11:50:30 +0000 https://blog.decree.om/?p=169 When we first launched Qanoon back in 2015, we launched it with the intention of enabling legal professionals in Oman to do their jobs easily, effectively, and efficiently. Little did we know that it would fundamentally transform the legal sector in Oman by becoming the definitive source for accessing Omani legislation in Arabic and enabling the public to be well-informed and up-to-date on the most recent legal updates. Indeed, Qanoon’s impact has been so far-reaching, even international organisations rely on it for their research and publications.

Qanoon does this by providing access to all of Oman’s legislation in Arabic for free, whether it is a royal decree, a ministerial decision, or a law with its amendments incorporated. To facilitate searching within the contents of these legal instruments, we have made them available in both PDF and text.

However, when it comes to the courts system of Oman, legislation is only one piece of the puzzle. Lawyers, prosecutors, and judges also need to access previous court judgments if they are dealing with cases that are similar in nature. Unfortunately, these judgments are incredibly difficult to find in any language due to the lack of an online and freely accessible repository. 

This is compounded by the fact that Oman does not follow the ‘precedent’ principle, whereby judgments in previous cases are binding on subsequent cases of a similar nature. While this grants judges the flexibility to issue judgments as they see fit for the cases at hand, it does bring about an element of uncertainty for both the claimant and defendant.

Putting aside the philosophical reasons as to why the precedent principle is not strictly followed in Oman, one can easily see that a practical reason for the failure of judges to follow previous judgments is the simple fact that judges themselves do not have access to them, just like the rest of us.

As part of the mission of Qanoon, we are now attempting to address the lack of access to judicial decisions, and today we are happy to announce the launch of a new feature—the court judgments section, which contains all of the most recently published judgments of the Supreme Court in both PDF and text.

We believe that the launch of this new section is a major milestone for the accessibility of the Omani legal system as this is the first time in history for Omani judicial decisions to be made available online, for free, in a fully searchable and structured database both in PDF and text. We are launching today more than 100 Supreme Court judgments in full text and more than 400 of these judgments in PDF relating to civil, labour, criminal, and other lawsuits. These judgments were taken from the official collections of the Supreme Court and include the official case number, the date of the judgment, the names of the judges examining the case, a brief summary of the primary legal principle, a number of keywords, and the full text of the judgment with the names of the parties redacted.

We believe that the release of these court judgments to the public will have a significant impact on the ability of lawyers to advocate their cases with more convincing evidence, the ability of judges to rule in a predictable manner, the ability of lawmakers to understand the real-life implications of the law, and the opportunity for law students to understand how the law works in practice. 

Court judgments are currently available only on Qanoon in Arabic and we will consider producing English translations of them in the near future on Decree. 

You can access the new feature on the following link:

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COVID-19 Supreme Committee Decisions https://blog.decree.om/2022/covid-19-supreme-committee-decisions/ Mon, 14 Feb 2022 13:44:00 +0000 https://blog.decree.om/?p=103 On 10 March 2020, His Majesty issued a royal order establishing a supreme committee to overlook all matters relating to the pandemic caused by COVID-19 and granting this committee the power to issue decisions as necessary to keep the virus at bay.

Due to the urgent nature of the pandemic and the unpredictable projections of the virus, the manner in which the supreme committee is created and the mode by which it issues its decision is extremely unusual. Government entities, including supreme committees, are usually created by royal decrees. These decrees would, among other things, explain the duties and competences of these entities, and their structure or membership. Such decrees would also be published in the Official Gazette. This was not the case for the COVID-19 Supreme Committee. Furthermore, instead of the traditional approach of governmental decisions being published on the Official Gazette, the COVID-19 Supreme Committee has opted for publishing its decisions directly via Twitter in the form of images.

This approach has resulted in Omanis being able to access these decisions immediately and easily. Since the decisions are in the format of images, they can also be shared easily on other social media platforms to spread the message. However, using Twitter exclusively as the platform of disseminating such critical legal content is not ideal as the content of these images is not searchable and locating specific old tweets can be a nightmare.

Take the COVID-19 Supreme Committee decision on 19 August 2021—it is still valid as of the date of this post but it would be hard to know this. First, assuming you hold a valid Twitter account, you would need to go through 479 of the latest tweets of the @OmanVSCovid19 Twitter account to find this decision. Then, you would need to comb through these 479 tweets again to check if there were any later decisions that amended or repealed this one. 

Given the importance of the content of these decisions, the legal impact they have had on the lives of those living in Oman and even abroad, and the reality that the legal community is already dealing with contractual and employment disputes resulting from the implementation of these decisions, we have decided to launch a new section on Decree dedicated exclusively to making these decisions available in full text. If you are looking for a specific decision, instead of going through hundreds of tweets, you can now simply search on Decree for a keyword, such as “quarantine”, and restrict the results to Covid-19 Supreme Committee Decisions by simply ticking on its box in the search bar. This will generate a search result that has every decision containing this keyword.

How did we do this? We went through all 4,577 tweets of the @OmanVsCovid19 Twitter account and identified 79 of them as COVID-19 Supreme Committee Decisions, which we then converted into text and uploaded onto Decree.

It is also worth noting that until now, our policy on both Qanoon and Decree was to access legislation solely from the Official Gazette. The approach we have taken with the COVID-19 Supreme Committee decisions marks a fundamental shift from this policy to accommodate for legislative documents that are not necessarily published in the Official Gazette.

Finally, I’d like to point out that the majority of the English text of the Supreme Committee decisions published on Decree is not a translation produced by Decree, but rather the original English text made available on the @OmanVSCovid19 Twitter account. We have simply made the translations available in a machine-readable format (i.e. text format) for ease of access. That is why the translation of these decisions does not follow Decree’s usual standard or methodology. 

Feel free to browse through the decisions and if you have any suggestions for improvements, as usual, we’re all ears.

We will also continue to keep a close eye on the @OmanVSCovid19 Twitter account for future COVID-19 Supreme Committee Decisions and make sure to upload them on Decree in both image and text formats as soon as possible.

You can view the latest COVID-19 Supreme Committee Decisions on this link. If you are more interested in Oman COVID-19 statistics and data, check out Open Data Oman’s page on COVID-19.

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