Octal sets ambitious plans

By Kaushalendra Singh — SALALAH: FEB 11 - Salalah-based polyethylene terephthalate (PET) company Octal, the world’s largest resin and sheet producer on a single site, has set ambitious targets for 2017 with 16 per cent sales growth and a long term goal of an IPO to support global expansion.

The company’s top brass dwelt upon Octal’s success story, its current and future plans during a two-day familiarisation meeting in Salalah on Thursday and Friday.  The company, according to them, focused on achieving leadership position in established markets with the introduction of its proprietary DPET sheet with its superior mechanical performance and environmental benefits in phase 1. Phase 2 involved disrupting existing markets through material science, conversion and new technologies. In phase 3, the company’s vision is to expand the universe of DPET

applications through the deployment of new processes and downstream growth.

Founded with an investment of $600 million, Octal operates on strong eco principles, prioritising the stewardship of natural resources. In 2015, it had an export value of $569 million, selling 98 per cent of its high-quality, environmentally friendly PET resin and sheet product overseas. With a total annual capacity of almost one million metric tonnes, Octal is the largest global manufacturer of PET Sheet and Resin on a single site, and the only company in the world with a fully integrated food packaging system from raw material to finished product.

In their comments to the Observer, Nicholas P Barkat, Chief Operating Officer; and William Joseph Barenberg Jr, Executive Vice-President and Chief Operating Officer termed 2016 challenging yet rewarding year for Octal, while expecting a robust 2017-18 due to the application of new technologies in the pipeline.

Barkat complimented the Sultanate as it marked Omani Industry Day on February 9 and said, “Octal’s global reach contributes to the diversification of Oman’s economic base by generating further direct and indirect employment opportunities for the people of the Sultanate and also to augmenting support for the domestic economy as it prioritises local suppliers and service providers.”

“We are working closely with SMEs and other manufacturers to develop the downstream PET industry and formulate a strategic outline and vision on how we can contribute to boosting Oman’s vision of a diversified economy. Developing new technologies with applications in new geographies have been the cornerstone of our success and a clear indication of the immense possibilities and potential of the manufacturing sector and its line of new products in the Sultanate,” he said.

Not detailing much about the IPO, IPO on the Horizon, both Barkat and Barenberg put stress on the fact that in its tenth consecutive year of growth since its establishment in 2006 and with four purpose-built plants in Oman, Saudi Arabia, and the USA, Octal’s products now comprise 7.3 per cent of Oman’s non-oil exports. The company is now geared for its third phase of growth — downstream expansion and value realisation, with the long term goal of an IPO to support global expansion. The growth in 2017 and 2018 is expected to mostly come from the application of new technologies in the pipeline.

They reinforced Octal’s position as the world’s leading supplier of eco-conscious and high performance DPET sheet and PET resin. “OCTAL has announced growth of 16 per cent in sales for 2017 with production already under way on contracted orders to the value of $260 million. The export powerhouse of Oman’s story of growth and market success has been all about consistently delivering value downstream, employing disruptive technologies that redefine DPET capabilities, and expanding the variety of its applications.”

Commenting on future plans, Barakat said, “Octal has invested and will continue to invest in a phased approach to capture end-use applications, where the next generation PET becomes the optimal solution when compared to applications with other polymers.”

Oman’s non-oil sectors, according to Barenberg “are expected to continue growing in 2017, gaining momentum in their ability to compete on a global scale. We are seeing a number of key initiatives being implemented like greater access to finance, the continued support and eventual completion of major infrastructural projects, as well as the rise of new logistical hubs that should have a significant and positive impact on businesses’ growth in the long-term. These are positive signs for Octal and Oman at large, making it highly likely that 2017 will be another year of growth and opportunity.”

Sean P Brown, Director of Operations, Salalah, explained Octal factory’s functioning to the visiting media representatives from Oman and UAE putting stress on OCTAL’s fully recyclable, sustainable packaging solutions, used by the food, beverage and pharmaceutical, as well as consumer goods businesses. The upward trajectory in demand for OCTAL, products, according to him, continues to be driven by the introduction of innovative new products.