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Sohar  Port and Freezone: at the centre of global trade routes

Sohar Port and Freezone: at the centre of global trade routes



Fast-growing logistics hub

Sohar Port and Freezone is moving forward to becoming the logistics hub of choice for the region, while aligning its goals with the Sultanate’s economic diversification efforts

November 2019

As one of the world’s fastest-growing logistical hubs, Sohar Port and Freezone, a deep-sea Port and Freezone in the Sultanate of Oman, is welcoming international investors to its 6,500-hectare development.

With multinational investments to-date of over $26 billion, it is one of the world`s fastest growing port and free zone developments and lies at the centre of global trade routes between Asia and Europe. The port was originally built around three industrial clusters for metals, petrochemicals and logistics.

Recently a fourth cluster was added with the launch of Sohar Food Zone. The Food Zone offers the region’s first dedicated agro bulk terminal with integrated facilities for food manufacturing, packaging and food logistics.

Situated midway between Dubai and Muscat, Sohar saw its first vessel berth in 2004 and the adjacent Freezone was added in 2010. The year 2018 saw over 3,434 vessels call in Sohar and the port now handles in excess of one million metric tonnes of sea cargo each week.

RFX Industrial Parks held a ground-breaking ceremony at Sohar Freezone recently

RFX Industrial Parks held a ground-breaking ceremony at Sohar Freezone recently

Sohar Port and Freezone is a 50-50 joint venture between the Sultanate of Oman and the Port of Rotterdam – the largest seaport in Europe, which employs 180,000 people and handles over 40,000 ships annually.

According to the company’s website, the first phase of the Freezone is almost fully leased out, three years ahead of schedule.

“Looking ahead, Sohar will continue to expand, both physically in land mass, as well as its clusters and client base. Due to foreign investment within the Phase 1, Sohar Freezone sees more expansion and growth plans underway in the upcoming Phase 2. The free zone offers a compelling value proposition with unique incentives for investors to operate their companies easily and flexibly, in an environment where businesses can prosper,” it said.

The new Sohar Port South expansion, which will ultimately add 250-hectares to the land area, is well under way. In addition to the land area, Sohar Port South will also provide additional cargo capacity in the form of new deep-water berths. Sohar Port South Package I has already added 50-hectares to the land area and is fully completed.

Some of the recent investments made by the freezone are:

 

RFX INDUSTRIAL PARKS

Sohar Port and Freezone, in collaboration with RFX Industrial Parks, recently held a ground-breaking ceremony to launch the Phase One onsite construction of the RFX Industrial Parks project.

The project will provide integrated services in the supply chain through strategic third party logistics (3PL) or fourth party logistics (4PL) partnerships. It represents a qualitative leap in the field of logistic services offered in Sohar Port and Freezone, said a statement.

The event was conducted, at the RFX site in Sohar Freezone. The ground breaking event was attended by members of the senior management of Sohar and RFX Industrial Parks.

The entire development will comprise up to 290,000 sq m of leasable space, which will offer various logistics and light industrial size formats, including Box and Flex-log formats while also providing an easy solution of moving to larger units as tenants’ business expand, it said.

Phase One will cover 10,600 sq m of leasable area and further phases will be developed based on a combination of pre-lease commitments and market demand, it added.

Omar Mahmood Al Mahrizi, CEO of Sohar Freezone – DCEO of Sohar Port, said: “Sohar has always been committed to providing its tenants with only the best quality services.”

“The RFX Industrial Parks facility will give our tenants more opportunities to lease warehouses or light industrial units instead of having to build their own. Apart from supporting our existing tenants, this development will also have the potential to attract new investments and businesses to set up at Sohar,” he said.

“This in turn will be pivotal in establishing Sohar Freezone as a distribution hub for both the local and regional market,” he added.

Mark Wrong, CEO of RFX Industrial Parks, said: “We are proud to be working alongside Sohar Port to deliver personalised industrial facilities to tenants that want to operate within Sohar Freezone.”

“Our flexible leasehold options allow tenants to reduce capital expenditure and take advantage of high-quality amenities and competitive rents. Our specialist logistics and industrial team are based at Sohar overseeing the development of all phases and are available to discuss the specific requirements any new tenant may have, as well as showcase the several options we can offer,” Wong concluded. 

 

GULF ALLOYS AND METALS

Sohar Port and Freezone also entered into an agreement with Gulf Alloys and Metals to set up a low carbon ferrochrome alloy production facility at the freezone, said a report.

The project will be capable of manufacturing of 10,000 mt per annum and is a part of the efforts of Sohar to bring in new global investments, added the Times of Oman report.

The OR3.5 million ($9 million) investment will occupy 37,000 sq m of land at Sohar Freezone and will utilise chrome ore and calcined lime, sourced from local mines and plants, respectively, it said.

The agreement was signed between Dr Mohammed Nasser Al Zaabi, chairman of the Board of Sohar Port and Freezone and Appala Satyanarayana Varma, owner of Gulf Alloys and Metals, representing the company.

The mining industry is one of the most promising sectors in the sultanate. Therefore, there is great interest in developing it to increase its contribution to the GDP.

In line with this framework, Sohar Freezone seeks to attract new investments capable of providing local added value in this field, such as the upcoming ferrochrome alloy production facility.

This new project is expected to pave the way for more investments in the future. This facility will serve as a positive step towards enhancing in-country value, by boosting the competitiveness of Sohar Freezone in bringing in new investments linked to the downstream of these industries, added the report.

 

$65M CEMENT FACILITY

Further, Sohar Port and Freezone signed a land lease agreement for the establishment of a cement block products facility, first-of-its-kind in the Freezone.

Dr Mohammed Al Zaabi, chairman of the Board of Sohar Port and Freezone and Salim Khalfan Al Mamari, owner of Wald Al-Qanas International (FZE) SPC signed the agreement.

The OR25 million ($65 million) local project will cover an area of 20,000 sq m at Sohar Freezone. Apart from cement projects, the facility will also be used for the manufacture of white cement and other products. Additionally, it will see the export of products to the GCC and African markets.

Commenting on the importance of the new facility, Omar Mahmood Al Mahrizi, CEO of Sohar Freezone – DCEO of Sohar Port said: “In our journey towards becoming a key logistics hub in the region, we continue our endeavours to attract potential businesses to Sohar.

“The investment made by Wald Al-Qanas International will witness the establishment of a project that is the first of its kind in the Freezone. Moreover, the by-products generated by other industries, such as the ferrochrome factories, can be used as feedstock for the new facility, thus reinforcing our principle of promoting downstream opportunities.”

Salim Khalfan Al Mamari stated: “We are proud to be setting up at the Freezone and to be able to contribute to the cross-industry principle that is promoted at Sohar. Additionally, the unique upcoming new facility will also play an important role in the creation of local job opportunities.”




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