Green Bonds and Sukuk in Oman: FSA Sustainable Finance and Issuer Disclosure

In October 2025, Oman Electricity Transmission Company (OETC) priced a $750 million green sukuk due 2030. It was the first green sukuk by an Omani company, it was 2.8 times oversubscribed, and it listed on the London Stock Exchange’s International Securities Market. Oman now has live green issuance, a sovereign Sustainable Finance Framework, and a dedicated rulebook from the Financial Services Authority. The open question for the next issuer is no longer whether the market exists. It is whether their disclosure can survive investor scrutiny.

Spectreco, a US-headquartered sustainability technology and advisory firm with offices in Atlanta, London, Lisbon, and Lahore, works with issuers on exactly that gap. Oman’s green finance direction sits inside a regional market that S&P Global expects to reach $15 to $20 billion in sustainable bond issuance in 2026. This article covers the Omani market, the frameworks that govern it, what issuers must disclose, and why assured data decides whether an issuance holds up.

Does Oman Issue Green Bonds and Sukuk?

Yes. Oman has both a sovereign framework for green and sustainability instruments and a completed corporate green sukuk. The $750 million OETC transaction in October 2025 proved issuer demand, and the Ministry of Finance framework gives state-linked entities a standing structure to issue against.

The first green sukuk

OETC’s $750 million issuance closed on 29 October 2025 as green trust certificates due 2030, structured as an Ijara (lease-based) sukuk through a special purpose company. A syndicate of ten joint lead managers, including Bank Muscat, placed the deal, which was 2.8 times oversubscribed and listed in London. Proceeds are tied to eligible green projects under the company’s own Green Financing Framework.

Sources: Baker Botts, AGBI

The sovereign Sustainable Finance Framework

Oman’s Ministry of Finance launched its Sustainable Finance Framework on 10 January 2024. It lets the government issue green, social, and sustainability bonds, loans, and sukuk in any currency. A Sustainable Finance Working Group drawn from 13 government bodies reviews qualifying projects and keeps an internal register of allocations. The framework supports Oman Vision 2040 and names eligible spenders such as Nama Water Services and be’ah.

Sources: Oman Observer, Trowers & Hamlins

What Is a Green Sukuk?

A green sukuk is a Shariah-compliant investment certificate whose proceeds are restricted to environmentally beneficial projects. It carries two governance layers at once: Islamic finance principles, such as asset-backing and Shariah board approval, and green bond standards, such as use-of-proceeds limits, external review, and impact reporting.

That dual structure is what makes Omani green sukuk more demanding to disclose than a conventional sukuk. An issuer has to satisfy a Shariah supervisory board and a sustainability reviewer, and the two assessments have to agree. Spectreco covers the regional picture in its guide to green sukuk and ESG disclosure in the GCC.

The Frameworks That Govern Omani Green Issuance

Two layers govern a green or sustainable issuance in Oman: the international market standards the instrument aligns to, and the FSA rulebook that approves the label and the external review.

ICMA-aligned frameworks

Oman’s sovereign framework is built to align with the International Capital Market Association (ICMA) Green Bond Principles 2021, the Social Bond Principles 2023, and the Sustainability Bond Guidelines 2021, plus the LMA Green and Social Loan Principles. The ICMA Green Bond Principles set four core components every credible green issuance is measured against:

• Use of proceeds: funding restricted to defined eligible green categories.
• Process for project evaluation and selection: how projects qualify and how risks are screened.
• Management of proceeds: how funds are tracked and unallocated balances are held.
• Reporting: annual allocation and impact disclosure while the instrument is outstanding.

Moody’s reviewed the sovereign framework and assigned it an SQS2 (very good) Sustainability Quality Score, finding it aligned with all four ICMA components.

Sources: ICMA, Moody’s Second Party Opinion

The FSA rulebook

The Financial Services Authority (FSA) issued Resolution No. Kh/21/2024, the Regulation Governing Bonds and Sukuk, on 21 March 2024, replacing the 2016 sukuk rules. It gives the FSA direct control over sustainable labelling. An issuer may not describe a security as green or sustainable without prior FSA approval, and an FSA-accredited independent auditor must assess the underlying projects against international standards the FSA recognises. That review is then published on the FSA’s approved disclosure system.

Source: Financier Worldwide

What Must an Omani Green Issuer Disclose?

An Omani green issuer discloses against the four ICMA components: a use-of-proceeds policy, a project selection process, proceeds management, and annual reporting. Under the sovereign framework, that annual report splits into allocation reporting, showing where the money went, and impact reporting, showing the measurable environmental outcome.

Eligible green categories under the sovereign framework include:

• Renewable energy and energy efficiency
• Clean transportation
• Sustainable water and wastewater management
• Pollution prevention and control
• Sustainable management of natural resources and land use
• Climate change adaptation

Fossil fuel activities, nuclear generation, and fossil-fuel transport rail are excluded. Impact reporting attaches a defined metric to each category, for example renewable capacity installed or the number of EV charging points, with the methodology and assumptions disclosed.

Sources: Trowers & Hamlins, ICMA

The Assured Data Behind Credible Issuance

Impact reporting is where most green issuances are weakest. Moody’s noted that no audit will be carried out on the impact reporting under Oman’s sovereign framework. The FSA requires an external auditor to verify that projects qualify as green, but the environmental numbers an issuer reports year after year, the emissions avoided or the energy saved, depend on the issuer’s own data collection.

That is the credibility gap. A green label verified once at issuance does not prove the proceeds delivered the promised outcome. Investors and reviewers increasingly test the data behind the impact report, not just the framework behind the label.

Issuers close that gap by building the data process before they issue, not after. Retrofitting emissions and energy measurement onto a live sukuk produces impact reports that do not hold up. Spectreco’s Climate Finance and Green Capital advisory structures the use-of-proceeds and reporting architecture, its Virtual Sustainability Office runs the ongoing allocation and impact reporting, and the approach fits the wider case for linking sustainable finance to lower cost of capital.

Frequently Asked Questions

Build Issuance-Grade Reporting Before You Go to Market

A green label opens the market. Assured, repeatable impact data is what keeps investors in it. Book an Oman green-finance reporting readiness review with Spectreco to map your use-of-proceeds, allocation, and impact reporting before your next issuance, so your disclosure holds up long after pricing.