Oman's Sohar and Salalah Ports Set to Boom, with $14 Billion Investment for Sohar

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Written by Richard Finlayson, Senior International Editor for Industrial Info Resources (Sugar Land, Texas)--With investments exceeding $14 billion, the Port of Sohar in northern Oman is one of the largest port development projects in the world. The port and the Sohar Free Zone (SFZ) have teamed up in a bid to promote business opportunities as both facilities undergo expansion, with the port facility developing as a hub for chemical trading.

In the last five years, Sohar Port has seen steady growth in throughput, with an increase of more than 100% in 2011. Vessel call growth increased 34% in 2011 year-over-year. This growth has been driven by a regional economic recovery resulting in an increase in the handling of steel and gas-related products, in addition to the launch of a new liquid-terminal jetty operation.

In 2011, the launch of new production line facilities made it an important year for dry bulk throughputs. Jindal Shadeed Steel (New Delhi, India) went into full production, while mining major Vale S.A. (NYSE:VALE) (Rio de Janeiro, Brazil) set up its regional headquarters in Sohar and has commissioned its first production line.

At a public-private sector meeting earlier this year, Sohar Port CEO Andre Toet said that Oman had not been hit by the global recession as hard as many other countries. The increased growth of the port and SFZ would bring increased benefits to the local area, he said. The government has raised budget spending on infrastructure for 2013, including ports by 10%.

On Oman's southern coast, the port of Salalah is a key distribution location for the growing markets of East Africa, India and the Middle East. Demand from international corporations looking to set up operations has begun to accelerate as increased cooperation between the port, free zone and airport offers a multi-layered, synergistic hub that connects Oman to the rest of the world. In 2014, the airport will open a new terminal. Claiming to be an ideal location for distribution and value-added services, the port has been launched this year as an umbrella brand, and it is known as the "The Salalah Hub."

Many major agreements for both the port and free zone have been signed this year, with global players including United States Gypsum (Chicago, Illinois), DHL (Bonn, Germany) and Spain's logistics company Algraposa, incentivized by the world-class container port and the expansion of the general cargo terminal in progress.

The expectation is that there will be substantial growth in cargo volumes and local job creation, with these top companies taking advantage of Oman's hub infrastructure, said the organizers of the Seatrade Middle East Maritime 2012 event, which will be held in Dubai. For related information, see September 6, 2012, article - International Refining, Rail and Steel Companies Pile into Oman's Project Pipeline.

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