During the first week of March, project finance deals were signed for Barka independent water plant (IWP) and the $5.2bn Liwa Plastics project.

Another two deals are expected to close in the first half of 2016 – Sohar IWP and Ibri/Sohar 3 independent power plant (IPP). Smaller real estate project finance deals also closed in late 2015, while new IWPs are on the horizon for 2017 and 2018.

Kuwait’s public private partnerships (PPP) programme is yet to pick up, and the pipelines in Saudi Arabia and Qatar are patchy. This makes Oman the most active project finance market in the GCC, with only the UAE offering comparable opportunities.

There are several challenges including limited capacity and low liquidity in the domestic banking system. Any deal above $300m needs support from foreign banks.

Of the two deals signed last week one was totally and the other predominantly financed by international banks. This shows that despite much lower oil revenues and US-based Moody’s Investors Services and Standard & Poor’s downgrading the sovereign rating, international banks still see Oman as bankable. This is especially true for Oman’s well-tested IWPP model.

As Oman considers how to further its diversification strategy in a context of continuing low oil prices, this will become more difficult.

The challenge is transfering the record built up in the energy sector to more complex deals.