• March 04, 2020

SOHAR Port and Freezone Brings in USD 27 Billion Dollars of Investment

SOHAR conducted its annual Business Reception at The Chedi Muscat on Tuesday, March 3. During the event, SOHAR also looked back over its achievements in the past year while also shedding light on future plans that will take place in the upcoming year. The event was conducted in the presence of a large number of strategic partners and representatives of the companies working at SOHAR Port and Freezone.

SOHAR Port and Freezone witnessed considerable growth, seeing an average throughput of over 1 million tonnes of cargo per week over the course of 2019 and bringing in investments of OMR 10.4 billion (USD 27 billion) to-date. During 2019, dry bulk was valued at over 36 million tonnes, liquid bulk at over 15 million tonnes and break bulk over 1 million tonnes. Additionally, the number of vessels that were called into the port reached nearly 3,200 vessels, 900 of which were in the last quarter of the year. Aside from capacity growth, it was announced that the Phase 1 expansion of SOHAR Port South was complete and saw 50 hectares of land added to Port’s present capacity. Work is currently underway for Phase 2, which will see the addition of another 200 hectares to the Port area of 2,000 hectares. There are also plans in the pipeline for the expansion of SOHAR Freezone, which in turn, will increase its capacity to bring in prospective investors.
Mark Geilenkirchen, CEO of SOHAR Port said, “We have seen incredible growth in 2019, with SOHAR successfully attracting a majority of international industries to set up shop at the Port and Freezone. This, in turn, creates a positive impact by enhancing our contribution towards the Sultanate’s GDP, supporting the Government of Oman’s diversification objectives and simultaneously creating more job opportunities for the local community. We look forward to 2020, which will also see the completion of the SOHAR Port South expansion. The land area has already been earmarked for global giants, such as Trescorp and Total, the latter of which aims to establish an LNG bunkering supply station for vessels at the Port, therefore attracting even more investments to SOHAR.”
Commenting on the growth in the Freezone, Omar Mahmood Al Mahrizi, DCEO of SOHAR Port and Freezone - CEO of the Freezone said, “Since its establishment, SOHAR has emerged as a global logistics and industrial hub and employs a young, capable and efficient workforce, while simultaneously investing in innovative solutions and developing strategies to meet the Sultanate’s national objectives. We seek to continue our commitment to align ourselves with Oman’s diversification and logistics strategies and attract foreign direct investment to drive further growth. This is also enriched by our unique offering of being the only port and free zone in the region that managed under a single entity. Therefore, we are able to provide potential customers with an array of integrated services under one roof.”
“With several new global investments, we are continuing to look for ways to develop a myriad of downstream opportunities, wherein one industry`s waste can be used as fuel for another industry. Other innovations include tapping into sustainable and eco-friendly energy resources to attract even more investments and industries into the region. Additionally, with our lower operating costs, energy-saving systems, easy land lease options, as well as our strategic location to key global markets, we host a distinctive competitive advantage. I look forward to our continued expansion and efforts to reach out to important countries, which will entice even more new businesses, resulting in significant growth in the years to come,” Omar added

“SOHAR Port and Freezone has a well-established mission and vision to establish itself as an important sustainable logistics hub in the region. Therefore, all our members are constantly focused on delivering excellent business services to our clients while continuing to enrich our relationship with the local community. We continue to keep ourselves abreast with the latest technology and developments to ensure maximum benefit not only to the organization and the surrounding community but to also align ourselves with the Oman Vision 2040,” Mark concluded.


Agreements and signings over the course of 2019:


2019 saw the groundbreaking of RFX Parks, Shell and Sanvira, alongside further expansions for Al Tamman Indsil, Matrix Prime and SV Pittie. New partnerships were also forged in the Freezone with Gulf Alloys and Metals and Madhav Surfaces.

In an effort to tap into the Sultanate’s renewable energy potential, the partnership with Shell Oman foresees 600 hectares of land being utilised for Solar Photovoltaic (PV) projects. A pioneering project is expected to begin operations in the current year, with the aim of delivering a power supply capacity of 25 MW.
Gulf Alloys and Metals signed an agreement for the creation of a low carbon ferrochrome alloy production facility, capable of manufacturing of 10,000 MT per annum and is a part of the efforts of SOHAR to bring in new global investments.
The agreement with Madhav is aimed at developing a quartz manufacturing plant to produce quartz slabs and other quartz products using chrome ore and calcined lime from the local market, to be exported to the USA and Europe.
SOHAR joins SEA-LNG to promote its investment in LNG bunkering facilities and the use of liquefied natural gas (LNG) as a marine fuel.  SEA-LNG is the leading multi-sector industry coalition, created to accelerate the widespread adoption of LNG. MARSA LNG, a venture comprised of TOTAL S.A. and OQ, is developing a state of the art LNG liquefaction plant and bunkering facility in SOHAR Port.
Highlighting the importance of the upcoming project, Mark Geilenkirchen, CEO of SOHAR Port said; “This major LNG Bunkering project will generate in-country value and job opportunities, and will support industry diversification efforts by promoting shipping activities in Oman.  The establishment of this facility will make SOHAR one of the key LNG bunkering facilities on the main shipping trade routes, alongside other strategic ports, many of whom are already SEA-LNG Members, such as the Port of Singapore. MARSA LNG will supply LNG sourced locally in the Sultanate.”
The the project will see the provision of LNG to the shipping lines calling at SOHAR Port.  The switch from traditional marine fuel oils to LNG has accelerated following the implementation of new sulphur emission limits by the International Maritime Organization (IMO) in January 2020 and the IMO greenhouse gas emission targets set for 2030 and 2050.
Peter Keller, Chairman of SEA-LNG said; “We are excited to welcome SOHAR to the SEA-LNG coalition.  SOHAR is our first Member from the Sultanate of Oman and will provide an attractive global offering once the marine bunkering project is completed.  From our perspective, this is an opportune time to develop LNG capabilities in Oman given the expansive growth of marine activity within the region. We welcome SOHAR to our cause of furthering the use of LNG as an important, environmentally superior maritime fuel.”
Due to its unique location outside the Strait of Hormuz and mid-way between Europe and Asia, SOHAR is ideally positioned to become a major LNG bunkering hub in the Middle East.  In addition, SOHAR Port and Freezone feature deep-water drafts capable of handling the largest vessels in the world.  The liquefaction plant and bunkering project will be able to offer attractive business conditions, further enhanced by access to a dedicated logistics chain as well as large domestic gas reserves.
Peter Keller continues: “As well as providing a means to comply with recently enforced sulphur limitations, LNG provides a clear pathway for the shipping industry to decarbonise through the introduction of biomethane and synthetic methane.  Now is the time to move forward with LNG as an important maritime fuel. Inaction is not a plan and we cannot afford to wait decades for solutions that may never be realised.  Investing in LNG capable vessels now provides the shipping industry with a pathway to a low carbon future as well as significant and immediate environmental and health benefits.”
For more information on SOHAR Port and Freezone, visit soharportandfreezone.com