| Oman’s strategic
location with the Straits of Hormuz in the north
and the Arabian Sea in the east, and a coastline
that stretches 1,700 kilometres makes it a vital
trading centre in the Middle East.
As a seafaring nation, Oman was popular as a trading
hub even in the past. In fact, Sohar – one of
the most significant parts of the country in terms
of trade and development – is still known among
the local population as the port of Sindbad. Its
ancient glory has not been lost over millennia.
The modern Renaissance, led by His Majesty Sultan
Qaboos Bin Said, has seen Sohar grow as a modern
port with much larger global significance.
Besides Sohar, Salalah and Muscat have also been
hubs of trade with Europe, the Far East, Egypt,
India, Africa and other parts of the world. Port
Sultan Qaboos is the main commercial port. Sohar
and Salalah are mainly transshipment hubs and
industrial ports of the Sultanate and have been
playing a key role in economic diversification.
Port Sultan Qaboos has witnessed a surge in the
number of visits by passenger ships, owing to
the development of the tourism sector in the country.
To cope with the growing activities on this front,
a cruise terminal is being built at the port,
while a plan has been drawn to set up a Duty Free
outlet. It is expected to be ready by the end
of the third quarter of the year. A feasibility
study has also been conducted by the Port Services
Corporation for the construction of a deep-draft
berth and additional storage space.
Oman Vistas takes a look at the role of the ports
and the tourism sector in government’s efforts
to diversify the country’s economy.
Port Sultan Qaboos
With the inauguration of one of the country’s
premier maritime gateways – the Mina Qaboos (Port
Sultan Qaboos) by His Majesty Sultan Qaboos Bin
Said in 1974, Oman’s maritime commerce and development
heralded a new era.
Port Sultan Qaboos is of strategic importance
not only for the Arabian Gulf, but also for the
Indian subcontinent and markets in Africa and
Europe. It is the main commercial port of the
Sultanate.
In fact, development activities began in all sectors
in the country with the beginning of the Renaissance
in 1970. The steady progress in Oman’s port sector
owes much to the support of His Majesty’s government.
The port, equipped with high-tech infrastructure,
skilled personnel and efficient container handling
operations, is managed by Port Services Corporation
SAOG, which was constituted in 1976.
There are plans to boost the container-handling
capacity, considering the ever-increasing volumes
of import and export. At present the capacity
of the port is 300,000 TEU per annum. From 1977–2005,
the total imports handled by the port were about
39.5 million DWT, accounting for 46.4 per cent
of the Sultanate’s total imports. The total exports
were more than six million DWT, or 34 per cent
in total exports.
Port Sohar
Managed by the Sohar Industrial Port Company (SIPC),
the port was set up in 2002. Sohar has the advantage
of being a strategic location in the booming oil
and gas traffic route just outside the Hormuz
Strait comprising of Muscat, Abu Dhabi and Dubai.
Sohar port, inclusive of its container project,
is one of the largest of its kind, currently spread
over 2000 hectares and for the period 2000 to
2008, its investment exceeds US $12 billion. It
is a modern industrial port lying 240km northwest
of Muscat, set up with an equal joint partnership
between the government of Oman and the Port of
Rotterdam, the Netherlands. Last year, it received
the prestigious DMA Award for Outstanding Port
Management. Oman International Container Terminal
(OICT) has entered a joint venture with Hong Kong-based
Hutchison Port Holding, the Oman government and
Netherlands-based Steinweg to enhance the container
terminal capacity of the port. The port’s current
container handling capacity is 800,000 TEU per
annum. Two other terminals that handle general
cargo are dry bulk (Steinweg) and liquid bulk
(Oiltanking Odfjell)
Features
One of the striking features of the Sohar Port
is that land and waterfront infrastructure are
leased to private companies in order to maximise
the private sector involvement. About 20 per cent
of the land is still available, as large parts
of the Sohar Industrial Port has already been
leased out. Operations like industrial production
and cargo handling are undertaken by specialised
companies as they can offer quality and competitive
rates. The above features are in proposition with
counterparts in Antwerp, India, Iran, New York,
Rotterdam, Saudi Arabia and Singapore. As a result,
SIPC can divert its attention towards other important
segments related to the port.
The industrial port of Sohar has attracted huge
foreign investments in industries and infra structure
projects, thereby boosting the national economy
of the country. The regional economy has benefited
in particular due to the supply of raw materials
and commodities and transport of finished products
to various destinations around the world from
industries which have developed around the port.
The Sohar port is undergoing a renovation and
expansion. There are three phases in the development
of the Sohar port project plan. The first phase
involved the construction of two main breakwaters,
deepening of the port basin and the entrance channel.
In the second phase, the initial quay wall and
the liquid bulk jetty were constructed. The port
is undergoing a third expansion which will be
completed in October 2008. On its completion the
number of berths in the port will increase from
12 to 22.
There will be building and expansion activities
for the next couple of years in Terminal B of
the first phase, which was recently opened by
OICT.
The ongoing expansions of the third phase are:
• The 400 metre breakwater, Harmool harbour has
been broken down and a 500 metre breakwater is
being constructed
• The extension of the quay wall by 1,900 metres-
Sohar Aluminium 300 metre, Shadeed Iron and Steel
1600 metre and Oman International Container Terminal
970 metre
• To admit larger vessels into the port land retrieval
along with 18-metre deepening of the port will
be carried out
• Larsen and Tourbo (L&T), along with Omani
collaboration have agreed to build a construction
site for heavy offshore equipment like drilling
platforms in October 2006. Larson and Tourbo is
constructing a 300-metre heavy load platform.
Sohar Industrial Zone
The upcoming industrial zone of Sohar is being
operated with local infrastructure to make themselves
less dependent on sources from outside and more
self-sufficient. There are a number of gas based
industrial units developing in Sohar. To enhance
production and marketing it has been classified
into three categories - metal industries, petrochemical
and logistics. A steel complex and aluminium production
come under the metal category; refinery and production
plants for aromatics, formaldehyde, methanol,
polyethylene, polypropylene, urea etc, are under
the petrochemical category. The logistics category
looks into cost effective means of operation and
the maximum use of the available infrastructure
for the industrial units.
The Sohar port industrial area along with a green-field
industrial complex is regarded as one of the largest
in the Middle East. The ongoing development project
in the port is still attracting billions of dollars
worth investments. In the long run, the expansion
and renovation of the port will play a key role
in the diversification of the economy of the country.
Port of Salalah
The Salalah port project in collaboration with
A.P. Moller-Maersk Group of Holland is the largest
privatised project in Oman. The government, companies
and investors of Oman own 70 per cent of the project
and the remaining 30 per cent is owned by Maersk
headquartered in Copenhagen.
Salalah port was created under the management
of Salalah Port Services Company SAOG in 1998
from being a small fishing port in southern Oman
- Mina Raysut to enhance the economy and encourage
tourism.
The success of the port lies in its geographical
location and natural deep water. It has the advantage
of being centrally located at the edge of the
Indian Ocean and of being the largest port with
the capacity to accommodate large vessels up to
16 metre draft. It provides multi-purpose facilities
of the highest standards. Hence it has become
the transit focal point for international container
shipping to the Gulf, Africa and the Indian sub-continent.
A combined project between the government and
the Salalah Port Services to increase the port’s
capacity from 2.4 million TEU per annum in 2006
to four million TEU amounting to US $356 million
is underway. At present the port has four berths
along 1,236 metres of quay. The capacity of the
port will be increased by constructing two new
berths with ten very large gantry cranes.
Salalah port has come a long way since its inception.
Today, it is not only the largest port in the
sultanate but also one of the world’s largest
container terminals and is also acknowledged as
one of the world’s leading trans-shipment centres.
The port has the facility to handle the largest
and most modern container vessels. Besides offering
services like repairing, container freight station,
bunkering and ware-housing it also has facilities
to handle bulk, general and liquid cargoes. To
add to these facilities, the port has also become
a gateway for the tourist influx into the country.
Salalah Free Zone
Spread over an area of 2000 hectares, the Salalah
Free Zone Company (SFZC) was established adjacent
to Salalah port by the government. The SFZ management
was officially launched in 2005 under the Salalah
Free Zone Company SAOC. The SFZ is steadily developing
phase-wise. On completion, the SFZ will offer
multiple facilities such as industrial, manufacturing,
warehousing, logistics, freight forwarding, access
to the seaport, international airport facilities,
outlets, residential space, employment, banks,
infrastructure and round-the-clock security.
The first Phase will cover an area of over 200
hectares. It will provide facilities like infrastructure,
logistics,
freight forwarding and manufacturing.
The first project set up by Octal Petrochemical
has already begun its production. In addition,
an India-based company, Dunes Oman has recently
signed an accord with SFZC to set up a 12-hectare
manufacturing unit for the production of automobile
brakes at Salalah free zone. In March this year,
the foundation stone for the project was laid.
There are many incentives provided by the government
at the SFZC including:
• Import duty exemption
• Exemption from income tax for a period of 30
years
• 100 per cent foreign ownership of investment
project
• Minimum capital limit
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