Report highlights areas of improvement at Oman Air

MUSCAT, NOV 10

The recent annual report of the State Audit Institution of Oman brings valuable insights into potential enhancements for Oman Air’s financial and administrative management from 2018 to mid-2023. It outlines opportunities for better handling of operational costs, improving the timeliness of dues settlement, and refining decision-making processes to enhance operational efficiency.

Since 2016, Oman Air has been actively addressing outstanding payments, which amounted to RO 117 million. By February 2024, the company made significant progress by clearing RO 5 million and established a structured plan to further reduce outstanding dues by paying RO 1 million monthly.

The audit also identified RO 229 million in payments made to fuel suppliers between 2018 and 2021 through “letters of goodwill.” Oman Air has responded positively by committing to formalise future contracts to ensure compliance with legal standards, showing its dedication to robust administrative practices.

Operational insights indicate that Oman Air encountered challenges with certain European routes due to feasibility study inaccuracies. Learning from this, Oman Air has embraced a more thorough approach to feasibility analysis, which now integrates comprehensive economic and operational evaluations.

Additionally, Oman Air has strengthened its policies on compensations for delays caused by technical factors, enhancing its procedures for documentation and claim processing to support fair and justified outcomes for all involved.

For Oman Airports, the report suggests areas to enhance receivables management, optimise investments, and improve technical operations. Proactive efforts are underway to address these areas, including collaboration with relevant authorities to ensure operational readiness of unused assets, like a RO 3.7 million cargo scanning device.

Salalah Airport’s operational resilience is also set for advancement, as repairs to backup power systems and resolution of water and fire system issues are prioritised. Oman Airports has issued a tender for an in-depth assessment to establish a lasting solution, underscoring its commitment to operational integrity.

Efforts to collect outstanding payments from airport service clients have shown progress, with legal measures in place to ensure timely recovery. This initiative supports sustained financial health across Oman’s airports.