Port of Duqm
Sponsored Report
Situated on the southeastern seaboard of the Sultanate of Oman, overlooking the Arabian Sea and the Indian Ocean, the Port of Duqm is fast becoming an important part of the Middle East region’s rapidly transforming maritime landscape. With its deep draft (18m), lengthy quay walls, and expansive basin, the Port of Duqm has the trappings of a world-class, multipurpose commercial gateway. And as the principal anchor of a huge Special Economic Zone covering an area approaching 2,000 square kilometers, it has the potential and ambition to develop into one of the Middle East’s largest hubs. The Special Economic Zone is divided into eight different zones of which the Industrial Port (170 sq. km.) forms the heart of all activity.
At the heart of Port of Duqm’s appeal is its strategic geopolitical location, far removed from the Strait of Hormuz and the Arabian Gulf. It is this advantageous location that the Omani government seeks to leverage as it sets out to position Duqm as a safe, stable and business-friendly destination for industrial and economic investment. Indeed, the Sultanate of Oman — and the Port of Duqm, in particular — stands to reap the benefits of the country’s international reputation as an oasis of tranquility and a standard-bearer of regional peace and reconciliation.
Underscoring the Port of Duqm’s strategic importance is its planned development into an integrated, multimodal logistics hub, encompassing maritime, road, air and rail modes of transportation. An airport is already operational for both passengers and cargo, while a proposed rail-based freight transportation network will link Duqm with the national rail system towards the end of this decade. Utilities and services are also ultra-modern, effectively providing investors with an unrivaled setting to do business. Free-trade agreements (FTAs) with Gulf Arab states and the United States, as well as a host of other nations, add to Oman’s investment appeal.
The Port of Duqm lies under the management of the Port of Duqm Company SAOC (PDC), a 50:50 joint venture between the Omani Government and the Consortium Antwerp Port (CAP). CAP is supported by the Port of Antwerp (Belgium), one of Europe’s largest hubs. Under a Royal Decree signed with the Omani government in July 2015, the joint venture has been granted a 28-year concession to co-invest, operate, manage and market the Port of Duqm.
The Port has entered into an early operations phase with a fully functional port and commercial quay capable of handling heavy-lift project cargo, general cargo, dry bulk and containers. Being located close to the major oil, gas and mining projects currently being developed in the country, Duqm is seeking to increase the activity level exponentially in the years to come. A multi-purpose feeder line linking Duqm with the main regional transshipment hubs is expected to be in place within the first half of 2016. Port, logistics and industrial prime land is prepared and readily available for investors seeking to benefit from the integrated package of incentives the Special Economic Zone has to offer, ranging from tax-exemptions, up to 100% foreign ownership, exemption from minimum capital requirements, no currency restrictions, free repatriation of profits and capital and so on.
The Port of Duqm’s current early-operations terminal, where it handles all break bulk, heavy lifts, general cargo, etc. stretches out over a quay length of 300 meters. Next to it, the Port of Duqm has an early-operations container terminal with 300 meters quay length; 200 meters in width, completely fenced, and ISPS-certified, where the Port of Duqm will handle the first container lines with mobile harbor cranes equipped with automatic spreaders, reach stackers, forklifts, etc.
Next to it is the expansion area, with a quay length of 1,000 meters and at the end of the terminal, over a length of 600 meters, are the early-operations dry-bulk terminal.
In the short term, the Port of Duqm will see its total concession area completely transformed by the implementation of a number of investment packages (seven in total). An example of this is the so-called IP2 Investment Package, which covers the full construction of the commercial berth. When the contractors have finished their construction work, the Port will have 300 meters for break bulk, two times 800 meters for two container terminals or one terminal of 1.6 km and a dry-bulk terminal of 300 meters.
The construction work for IP2 will start in the first half of 2016 and the Port of Duqm is expecting to finalize everything by the end of 2018 or the beginning of 2019. From then on, the Port will be able to work on a full-fledged container terminal. Between now and the finalization of construction, the Port will move from its present operational area to the area that will by then have been constructed, to avoid any standstill.
The Port of Duqm is also investing in two pilot boats. The first will be delivered in the first quarter of 2016, the second in the second quarter of this year.
As for the logistical land within the Port’s concession area, the first 65 hectares have been leveled. The Port of Duqm is already finalizing negotiations with some clients and expects to have put this first phase fully under long-term land-lease contracts within 2016. The first part of the Port’s industrial land, strategically positioned just across from the future refinery, where medium to heavy industries will be attracted, is currently being leveled. The first tenants are expected to develop their activities soon.
Very important also are the investments that will be made for the liquid-bulk terminal, which will be linked to the future Duqm Refinery. The Port of Duqm expects that the dredging, reclamation and marine infrastructure will be constructed from Q3 2016 to Q4 2018, whereas the construction of Duqm Terminal’s super structure will start in Q1 2017 and be finalized in early 2020, simultaneously with the start of the Duqm Refinery. From that point onward, the Port of Duqm will offer break-bulk, dry-bulk, container, naval and liquid-bulk activities.
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