'We are pleased to inform our esteemed shareholders and investors that the construction services for Yibal Khuff project - on plot with PDO has been awarded to Galfar for the value of approximately RO115mn' the company said in a filing to Muscat Securities Market (MSM) on Wednesday.

It said the duration of the construction services contract with PDO is 51 months. The scope of works includes construction of a new central processing facility in Yibal Khuff area which includes civil mechanical electrical and instrumentation works.

'We expect reasonable income from this project' Galfar added.

Recently Galfar announced that its off-plot delivery contract (ODC North Oman) with PDO was extended from April 1 2016 to March 31 2018. This off-plot delivery contract is a service contract with PDO in which Galfar expect to generate revenue of around RO120mn during its period.

Galfar posted a net loss of RO28.85mn for the year 2015 on the back of a large provision for receivables. During the year the parent company provided RO31.92mn towards impairment of receivables. Out of these provisions the major portion is a provision for Muscat Expressway and Central Corridor projects.

In its directors' report submitted to MSM on Sunday Galfar said that it has a confirmed order book of over RO640mn at the end of 2015 and its revenues for 2016 are expected to be more than 2015 levels despite an increasingly challenging market environment. The company has initiated a transformation programme to achieve a sustainable improvement in performance and operational efficiency.

'Galfar's board is fully committed to the rigorous implementation of the transformation programme over the next 12-18 months with tangible results expected in the second quarter of 2016 and better operating results in financial year 2016' the report added.