Oman – Infrastructure Projects

Megaprojects Are Taking Place in the Duqm Region of Oman

Published: 17 April 2019

Special economic zone attracts investment

Plans for the central-eastern region of Duqm in Oman date back to the 1990s. Since 2007, investors have realized projects worth more than US$ 5 billion. The current projects and those planned by 2025 have increased investment volume to about US$ 45 billion.

The population has doubled in the last ten years to currently ~13,000 (2017: 11,269 inhabitants, of which 6,521 were foreign nationals). In the medium term, approximately 100,000 people are expected to live and work in Duqm.

A special economic zone covering 2,000 square kilometers was established in 2011. It offers domestic and foreign companies various investment incentives. These include exemptions from corporate tax, income tax and customs duties, no minimum capital requirement, the possibility of 100% foreign participation and exceptions to labor law provisions. The Special Economic Zone Authority Duqm (SEZAD) is responsible for the development of the zone. Its headquarters is located in the Omani capital, Muscat (

Port expects growth spurt

The first major project in Duqm is a new port, under construction since 2007. So far, about US$ 1.5 billion has been spent. It has been operating in phases since 2012. Work on the Commercial Quay (2,250 x 350 meters) is expected to be largely completed by 2020. The quay consists of a multi-purpose area, a container terminal, a RoRo terminal (roll on roll off) and a dry bulk handling area.

The port operator is the Port of Duqm Company (, founded in 2010. The 50:50 joint venture between the Omani state and the Consortium Antwerp Port was awarded a 28-year concession. Currently, port activities are mainly limited to unloading equipment for the Omani oil and gas industry and supplying construction projects in Duqm. In addition, minerals mined in southern Oman (such as limestone) are shipped. A railway mineral rail line is planned to facilitate the transport of limestone from deposits in southern Oman to Duqm. Private investors are being sought for this.

According to the Port of Duqm Company, about 3 million tons of freight were handled in 2017. With the completion of further construction phases, cargo handling is expected to rise to 17 million tons in 2020 and 39 million tons in 2022. Whether these increases can be achieved will depend on the implementation of major industrial projects. By 2022, export of oil and petrochemical products is expected to generate up to 55% of transshipment volume, with container freight – especially transshipments – accounting for around a quarter.

The Dutch company Royal Boskalis Westminster is building the US$ 515 million terminal for loading oil and petrochemical products. It is about one kilometer long and offers four berths for large tankers. Completion is scheduled for 2020. Also under construction is a 1 kilometer-long quay to be used by the Omani Navy and Coast Guard as well as Indian and British warships.

Daewoo Shipbuilding and Marine Engineering Company has operated two 400 m-long dry docks for ship repairs in Duqm since 2013. The German company MAN Energy Solutions also plans to set up a service center for ship engines in Duqm starting in 2020.

Crude oil refinery and petrochemicals are focal points

Duqm Refinery and Petrochemical Industries Company, a 50:50 joint venture between Oman Oil Company (OOC) and Kuwait Petroleum International, is building Oman’s third oil refinery in Duqm, at a cost of US$ 6 billion. The 230,000 barrel-per-day refinery will produce fuels (diesel, kerosene, LPG) and petrochemical products (naphtha, sulfur, petroleum coke, etc.). The British construction company AMEC Foster Wheeler is managing the project (

According to press reports, the refinery is on schedule and will be completed by the end of 2021. Three EPC (Engineering, Procurement and Construction) subcontracts with a total value of US$ 5.6 billion were awarded in 2017:

– EPC 1 Process Units (US$ 2.7 billion to Tecnicas Reunidas and Daewoo Engineering & Construction)

– EPC 2 Utilities and Offsites (US$ 2.0 billion to Petrofac and Samsung Engineering)

– EPC 3 Offsite Facilities (US$ 0.9 billion to Saipem and McDermott International)

Among other things, the refinery will supply the US$ 9 billion Duqm Petrochemical Complex, which includes an aromatics plant and a polypropylene plant. The feasibility study was carried out in autumn of 2018. The FEED contract (Front End Engineering and Design) was to follow. However, discussions are now underway about reducing the size of the project.

Siemens receives EUR 200 million order

The Duqm Power Company is building a 326 MW power plant to supply the oil refinery and the planned petrochemical complex, including a seawater desalination plant (capacity: 36,000 cubic meters per day). Duqm Power is a joint venture between Oman Oil Company and Gulf Energy.

Siemens will supply five SGT-800 gas turbines, five SST-300 steam turbines and the control technology for the combined gas and steam turbine power plant. Siemens also signed a 25-year service agreement. The total order volume is EUR 200 million. For Siemens, it is the largest order from Oman to date. The power plant is scheduled to go into operation in 2022.

The Oman Power and Water Procurement Company is also planning a 1,200 MW coal-fired power plant in Duqm, expected to cost US$ 1 billion. In the summer of 2018, companies participated in a prequalification process. A decision is still pending. The Finnish company Pöyry is acting as a consultant. A longer-term timetable is currently undecided.


Oman (Duqm): Further selected projects in the planning phase

Project Investment (US$ millions) Status* Responsible
400 KV North South Interconnection 780 ST Oman Power & Water Procurement Company
Duqm Biofertiliser Plant 700 ST Ghantoot Group
Nahayda – Duqm Refinery – Ras Markaz Terminal Pipeline 600 FEED Oman Gas Company (OGC)
Floating Storage Re-gasification Unit 500 ST Port of Duqm
300 MW Coal Power Plant 406 FEED Hebei Electric/Ningxia Electric
Gas to Liquid (GTL) Plant 250 ST Shell/Oman Oil Company
Duqm Cement Plant 212 ST Al Wusta Cement Company
Ras Markaz Pipeline Connection and Terminal Expansion 200 ST Oman Tank Terminal Company
200 MW Duqm Wind Independent Power Plant 200 ST Oman Power & Water Procurement Company
Silicon Metal Smelter 174 ST Al Braik Investments/ADPC/EMAL
Solar Equipment Manufacturing Plant 94 DE Ningxia Zhongke Jiaye

*ST = Study, DE = Design, PQ = Prequalification, FEED = Front End Engineering and Design

Source: author’s research


China builds an industrial park in Duqm

A 1,200-hectare China-Oman industrial park is expected to attract some US$ 11 billion in investment. The largest project is a US$ 2.8 billion petrochemical project (Methanol to Olefins, Investor Mingyuan Holdings Group). Furthermore, a 300 MW coal-fired power plant (US$ 406 million), a 5-star hotel (US$ 203 million), a solar module plant (US$ 94 million), an off-road vehicle assembly plant (US$ 84 million) and a seawater desalination plant with bromine recovery (US$ 81 million) are planned.

Since 2014 the Emirati Ghantoot Group has been considering constructing a US$ 700 million organic fertilizer plant in Duqm. Shell and OOC are discussing a GTL (Gas to Liquids) project. The Chinese-Arab Wanfang Investment & Development Company is planning a second oil refinery with a capacity of 230,000 barrels per day. Karwa Motors, a joint venture of the Oman Investment Fund and Mowasalat from Qatar, plans to build a bus assembly plant costing more than US$ 400 million.