Port of Sohar Magazine 2011, Issue 5

His Majesty Sultan Qaboos bin Said

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Publisher: Oman Establishment for Press Publication and AdvertisingCEO: H.E. Abdullah bin Nasser Al RahbiEditor-in-Chief: Fahmi bin Khalid Al HarthyEditor: Maurice GentNews Editor: Conrad PrabhuMarketing In Charge: Prem Varghese GSM: 95210257 [email protected] photography: Hywell WatersDesign and layout: Al Hulool Communications, Sohar

This magazine is published by OEPPA for the Port of Sohar


Sohar Industrial Port Company SAOC

Group CEO: Jan H Meijer

contentsMessage from the Chairman 4 Message from the Undersecretary 5Message from the Group CEO 6Port Zone maps 7-11Message from CEO Freezone Sohar 12 SIPC management team 14 Year in review 16Looking to the future 18Entrenching a culture of safety 21Standing sentinel over the environment 22Petrochemicals cluster 25Metals cluster 39Logistics cluster 61Service providers 75Service directory 112

Port of Soharissue 5 2011


A ilChairman: HE Maqbool bin Sultan

THE RECENT financial crisis has had its impact on many global economies with varying degrees. On the other hand it provided a shift in thinking; a shift that was necessary to safeguard against recurrence of such disasters.

To put it into a national perspective, I am relieved to say Omans economy has continued its steady growth in 2010. Whilst the global trade and transport sector was badly hit, the Government of Oman maintained its focus on expanding its infrastructure including health, education and the general welfare of its people.

In addition, the Government has injected adequate funds to ensure the banking sector continues to support industrial development in Oman.

However, the recovery from the global economic downturn has been (and still is) slow and fragile, although fuel prices are rising steadily to a pre-crisis level and consumer spending once again is increasing. A number of concerns are still evident. For example, the recent climatic disasters that are witnessed in various parts of the world, call for serious measures to be taken on poverty and food security.

This is not just a concern of badly affected geographies but also a concern for the international community as a whole. It is certainly a concern for us here in Oman. It has become necessary for the world community to come up with creative solutions to achieve higher uniformity of food distribution across the globe. Whilst it is crucial to secure land and institute better policies to preserve the well-being of farmers and increase crop production, we believe a more

cost-effective supply chain would go a long way to help major food-producing countries penetrate less fortunate countries. The more stringent environmental and financial controls, coupled with higher energy costs and increased commodity prices, companies look for clever ways to improve their top and bottom lines.

The recent events on the worlds stage are only but a reminder of the importance to invest in human capital. Health and education should be paramount and investments in these two sectors (whether public or private or both) cannot be over-emphasized. Continuing to find ways to create more jobs is an economic objective for many countries but is a prime concern for us in Oman with a predominantly young population, though modest in size (only over 2 million).

Sohar has been a successful project from the start. The model to create a strong logistics infrastructure with adequate energy resources has helped capitalize on the strategic advantage of its location near growing and densely populated markets. It has allowed companies to consider Sohar as a hub for regional distribution, owing in part to its inherent features but also as part of a re-positioning strategy to expand their market share and reduce capital and operational costs. Port of Sohar and Free Zone will effectively contribute to the solutions that address todays pressing economic and trade issues, but, most importantly, issues of human life itself.

Oman prospers despite global nancial crisis

Minister of Commerce and Industry, Chairman of SIPC

4 | PORT OF SOHAR 2011


ABy HE Maqbool bin Sultanil

WHEN in 2000 the Government completed a

was not imagined the industrial development would take off as rapidly as it did. Owing to its strategic location outside the Strait of Hormuz

with adequate energy resources, it was not surprising that a number of multi-national industrial firms decided to invest in Sohar.

However, there were other key elements to secure the interest of the industrial community. Infrastructure was built ahead of any investments to demonstrate the seriousness of the Government. In addition, a special purpose joint venture company between the Government of Oman and the Port of Rotterdam was established in July 2002 to develop and manage the Port on the basis of the landlord model. However, with such large and diversified industrial investments taking place, it became evident the transport infrastructure had to be expanded and equally diversified.

The Port of Sohar today is considered one of the largest ports in the region with more than 5 kilometers of berth capacity and water depth between 16m and 25m. The port is considered a world-class port as it has the biggest names in the worlds port industry. Besides the Port of Rotterdam as a long-term partner with the Government of Oman to manage the Port, other renowned international operators manage and operate the Ports common-user terminals, the likes of Hutchison Whampoa for containers, Oiltanking Odfjell for oils and chemicals and Steinweg for general cargo.

With such massive growth at the Port of Sohar, other modes of transport have become necessary. I will briefly highlight the most notable projects: Firstly, the Government has started the

construction of Sohar Airports first phase. This phase would comprise infrastructure and facilities for cargo and passenger operations, which would allow Sohar to offer sea-air services as well as aviation-related industries linked to Freezone Sohar. Secondly, a fast train system is being planned for the northern portion of Oman and would include railway connection and train freight operations to the Port of Sohar/ Freezone area.

Thirdly, the Ministry of Transport and Communication will embark on the extension of the Al-Batinah expressway between Muscat and Sohar and the northern border of Oman during the current five-year-plan. This multi-modal transport system is intended to help shippers and transporters to serve the local market as well as regional markets more efficiently and expand trade to such markets.

Last but not least, the establishment of the International Maritime College Oman (IMCO) in the Port of Sohar as a joint venture between the Government of Oman and the Shipping and Transport College of the Netherlands, is an important cornerstone in the industrial and maritime development in Oman.

This college is a unique establishment offering academic and vocational training in logistics, transport, shipping and industrial processing amongst others. It would form part of an existing education cluster, which includes technical colleges and university in the northern part of Oman, with a primary objective of providing a trained local workforce to the industrial market in Sohar and the Region.

Port of Sohar a cornerstone in Omans transport infrastructure

By HE Said Hamdoon Al Harthy

Undersecretary, Ministry of Transport andCommunication (Ports & Maritime Affairs)

PORT OF SOHAR 2011 | 5


master plan of Sohar Industrial Port Area, it

A WARM welcome to you, present and future clients of the Port and Freezone Sohar.Over the past eight years, our multinational team has built up considerable experience in serving investors as well as day to day users of

the port and Freezone Sohar. We are aware that investors as well as shippers and receivers have a choice and therefore it is of utmost importance to be constantly aware of your present and future requirements, in order to be able to give you this professional service.

2011 is going to be an exciting year for the Port and Freezone Sohar.

The Freezone Sohar is now fully operational. The Royal Decree, which gives the Freezone Sohar its legal foundation, has been signed by His Majesty Sultan Qaboos bin Said. The infrastructural works are ongoing to keep pace with the investors requirements and this year again many new investors are expected to join. A key element this year is the launch of a sophisticated logistic cluster in the Freezone Sohar which will both give a boost to the activities in the Port as well as the Freezone Sohar itself.

The steel cluster is expected to fully get off the ground: Our new iron ore jetty, unique in the region, is expected to receive this year for the first time the largest bulk carriers in the world of the so-called China max type of more than 400.000 dwt, loaded with iron ore from Brazil, while at the same facility the first cargoes of Iron ore pellets produced by the unique pelletization plant of Vale Oman are going to be shipped to steel plants in the region.

The Shadeed / Jindal Direct Reduction Iron (DRI) plant which now is fully up and running, is expected to ship their first cargoes of iron produced in Oman as well.

Our liquid jetty and tank terminal operator Oiltanking Odjfell (OOT) will complete further expansion of its independent tank capacity to serve even more clients.

Our General Cargo operator, Steinweg Oman, is expecting further growth in the number of its specialized activities including car handling.

Our modern Hutchison-managed Oman International Container Terminal is expecting to add a number of new main line container lines and therewith further concentrating the container flows of the Batinah region through the Port of Sohar.

The International Maritime College Oman (IMCO), providing high quality personnel to the Sohar terminals, shipping companies and industries, has moved to the Port of Sohar into a brand new facility.

In order to be able to facilitate all these developments, our organization will be further adapted. Our marine services have been further upgraded to handle the increased number of ships and much larger vessels. Our commercial departments including the Freezone Sohar one-stop-shop has been expanded to ensure that you will experience the same speed of commercial response which gave us our reputation.

All together: On behalf of our entire team, I welcome you to the Port and Freezone Sohar.

Sohar, a client-friendly Port and Free Zone

By Jan H Meijer

Group Chief Executive Ofcer,



Sohar Industrial Port Company SAOC


Freezone Sohar3,360 ha

Gulf of O

man

Proposed Corridor Al Batinah

Expressway and Proposed Railw

ay

Road UnderDevelopment

Proposed Coastal Road

Extension ofFreezone Sohar

1,000 ha

SoharA

luminum

Smelter (SAC)

Muscat

Abu Dhabi

etatsE lairtsudnI rahoS ah 591,1

Sohar Airport

2,061 ha

Extension ofSohar

IndustrialEstate887 ha

Residential area and farms

(existing)

Dubai

22 km horizontal diam

eter

36 km circum

ference

17 km vertical diam

eter

SoharIndustrial Port

2,058 ha

Residential area and farm

s(existing)

Residential area and farm

s(existing)

Phase 1500 ha

Greater S

ohar Industrial Zone


Oil And ChemicalStorage


Sohar Freezone LLCLand Use & Plot Allocation

Metals

Concrete Products

Petrochemicals

Light Manufacturing

Trading and Logistics

Education and Services

Oil & Gas Services

Entrance Complex

Central Facility Area and Mosque

Wadi Channel with Green

Welcome toFreezone Sohar

LEFT: Area map showing Port of Sohar and Freezone locations

ABOVE: Freezone Sohar Master Plan

BELOW: Plot allocation within Freezone Sohar



W HEN the Government of Oman, together with the Port of Rotterdam, established a joint venture to develop and manage the Port of Sohar in 2002, we knew we were onto something big! After all, the port was strategically situated outside the Strait of Hormuz in a region that was witnessing double-digit growth rate. It was no surprise that by 2009 the ports industrial area of 2000 hectares became almost full and a decision to expand and brand a larger industrial zone had become a natural evolution.

Under this context, two important milestones were achieved in 2010: One, the establishment of Freezone Sohar; and two, Gateway Sohar, the brand given to the Greater Sohar Industrial Zone encompassing the port, airport, free zone, industrial estate and a planned railport within an area of diverse economic activities along the 45 kilometers stretch of the North Al Batinah region. The Gateway and, more specifically, Freezone Sohar, are destined to play an important role in expanding regional markets and creating a marked difference in the trade landscape amongst countries of the Middle East, GCC, Iran and the Indian Sub-continent.

Freezone Sohar measures an area of 45 square kilometers and is considered part of an expanded area of the Port. With a number of gas-based petrochemical and mineral (aluminum, ferro- and steel) industries already established, the Freezone Sohar would be an ideal location for downstream industries.

In addition, with strong logistics infrastructure, the Freezone is considered a suitable hub for regional

distribution and trade. These activities can be undertaken under the umbrella of Sohar Free Zone Law, wherein investors can take full advantage of the Freezones fiscal and regulatory incentives. These include 100% foreign ownership, tax holidays up to 25 years, Omanization level of the workforce as low as 15%, no import duties and streamlined customs services.

Although most ideal for export-oriented business activities, such incentives would apply even if an investor is directing his business towards the local market. The only difference is the 5% import duty would apply as it is part of a GCC regulation. Furthermore, Freezone Sohar offers a one-stop-shop service to its customers whereby the investor need not bother with having to deal directly with Government institutions for permits, licenses and visas. The Free Zone authority would do it on behalf of the investor. Under the Free Zone regime, Customs rules and regulations are streamlined and customer-friendly.

Besides the modern multi-modal transport infrastructure, two other key elements are noteworthy: an abundant amount of electricity and water, offered by the same service providers for the ports heavy industrial area; a number of technical colleges and an international maritime and transport college offering training in various relevant fields.

As of writing this message, a logistics park is planned within the Free Zone wherein interested companies or traders may lease space for various types of warehousing/ storage services with associated onward transport services. Cold storage as well as dry storage of food products and other consumables which are targeted for the regional

Opportunities galoreat Freezone Sohar

By Jamal T Aziz

Chief Executive Ofcer, Sohar Free Zone LLC



market are planned. This would offer importers and exporters the opportunity to expand their business with more efficient supply chain management.

Freezone Sohar is a unique undertaking amongst other free zones in the region. It is the first privatised free zone authority with international specialized developers (Port of Rotterdam from the Netherlands and SKIL from India) owning two-thirds of the business, with the Government of Oman owning one-third. Under Sohar Free Zone Law, the authority has freedom to co-invest with third parties in selected free zone projects. The Privatized nature of the free zone allows the free zone authority to control infrastructure development as well as set its own tariffs in accordance with market forces. In addition, by having an excellent training platform as mentioned earlier, Freezone Sohar offers local labour solutions to organizations looking for a stable workforce with long-term prospects for employees.

The development of infrastructure in Phase 1 (5 square kilometers) of Freezone Sohar has already started in tandem with a number of regional and international tenants already leasing land.

I am proud to say we have a very competent and hard working management team of various nationalities working to develop the Freezone and serve our clients. We are also indebted to the valuable support of our Board of Directors comprising most senior executives from the Port of Rotterdam, SKIL and Omans Ministry of Finance under the chairmanship of His Excellency Maqbool bin Sultan, Omans Minister of Commerce and Industry.

On behalf of our team, it gives me great pleasure to invite you to Opportunities Galore at Freezone Sohar!!

Royal Decree on Freezone announced HIS MAJESTY SULTAN QABOOS BIN SAID has issued Royal Decree No 123/2010, which permits the establishment of Freezone Sohar (FZS). This allows for an organization known as Sohar Free Zone LLC to become the operating authority.

The new Freezone Sohar Authority will have the right to set up a one-stop-shop system, which will allow the issue of licenses, permits, visas and approvals. It will also have the authority to see that the regulations of the law are strictly followed.

The new operating authority will be responsible for the management, development and operation of the FZS.

It will have the right to an exemption of taxes for ten years and to extend the concession for further periods of ve years up to a maximum of 25 years. In all cases, to enjoy tax exemption the Omanisation levels must meet the requirements of the new organization, not falling below15 per cent.

Notwithstanding the Freezone Sohar law, the Operating Company will submit an annual tax return to the Secretariat General of Taxation.

The operating authority and the Working Company have the right to repatriate prots and investments.

All transactions made by nancial institutions within the Freezone Sohar will be subject to the Money Laundering and Terrorist Financing Laws, and to all provisions related to banking and nancial institutions within the Sultanate.

The operating authority and working companies will both have the right to own commercial representative ofces within the Customs territory of the Sultanate.



Jamal T AzizCEO Freezone Sohar

Deputy CEO Port of Sohar

Jan H MeijerCEO Port of Sohar

Edwin van EspenHead of Special Projects

Neelima VyasCOO Freezone Sohar

Jabir PuthiyapuraActing Finance Manager

Yvo de ZwartExecutive Technical Manager

Sohar Industrial Port Company



Annica SigevallHead of Corporate Communication

Fahad Al JasassiExecutive Administration Manager

Edwin LammersExecutive Commercial Manager

Suresh A Sundara RajanIT Manager

Suwaid Al ShamaisiExecutive Manager HSSE

John HollanderHarbour Master

Azzan Al HarthyExecutive Internal Auditor

Senior Management Team



20year in^ SIPC signed a contract with Pennys

Trading Company to establish an on-site restaurant for staff and visitors

^ Herring, anyone? SIPC staff taste-test the Dutch delicacy at the annual SIPC herring event

^ The SIP Cup is now the biggest football tournament in Al Batinah region, with 32 teams competing. In 2010, Oiltanking won the championship against Sohar Aluminium

^ There were smiles all round when Oman Container Lines made its first port of call to Sohar in mid-December

^ Ministers Khamis, Maqbool, Malik and Macki attend a meeting with SIPC management about the new Port Gate

^ An agreement between IMCO and SIPC enoperations personnel to use the Colleges simpurposes

^ SIPC again attended TransOman in Muscat on 10-12 October, one of the Middle Easts largest transportation exhibitions



010in review

^ A signing ceremony signalled the start of civil works at the Freezone Sohar site. The works are being carried out by Al Naboodah Contracting

^ The Brazilian Minister of Trade, along with the Brazilian Ambassador and representatives from Vale Oman Pelletizing Company, visited SIPC to discuss future cooperation

^ The Oman Chamber of Commerce and Industry Board members made a familiarisation tour of SIPC and its facilities

d SIPC enables SIPC marine eges simulators for training ^ Celebrating the Freezone

Sohar Royal Decree^ SIPC staff enjoy Iftar during Ramadan

^ Local students explore the Freezone Sohar excavation site where 3000-year-old artifacts were discovered



PORT OF SOHAR UNQUESTIONABLY ONE OF Omans finest economic successes is in a sense, still a work in progress. Six years since the launch of the nations biggest industrial and maritime hub, investments continue apace in the ports infrastructure and services. This is in keeping with a pledge made by Sohar Industrial Port Company SAOC (SIPC), at the outset of the ports development, to undertake all necessary steps to sustain and enhance Sohars appeal to international investment and maritime traffic.

Hundreds of millions of dollars have been earmarked by the joint venture partners, the Government of Oman and the Port of Rotterdam, for investment in a host of new initiatives designed to reinforce Port of Sohars position as the Gulfs pre eminent gateway.

A series of new terminals and jetties are envisioned, along with projects that support rail and road connectivity. A new entrance, conceived as an imposing gateway into the port, is on the drawing board as well. So too are a number of long-range planning projects that will open the way for significant landside and waterside development in the future.

Overseeing these initiatives are several specialist teams within SIPC dedicated to, among other areas, Spatial Planning Development, Geographical Information Services, New Infrastructure Development, Interface Management, and Maintenance and Repairs. Where necessary, they closely interact with the relevant departments and agencies of the government, notably the Ministry of Transport and Communications, and the Supreme Committee for Town Planning.

Deepwater bulk jettyThe most significant by far is an initiative involving the construction of two large-scale projects which promise to transform the wider Batinah region into a regional powerhouse for industrial-scale mining, quarrying and mineral processing.

The first of these projects centres on the development of a major deepwater bulk jetty to support the bulk shipping needs of Brazilian mining conglomerate Vale, which is building a huge

iron ore pelletising and distribution centre at the Port of Sohar. Construction work on the deepwater bulk jetty, estimated at $250 million, is well underway. A joint venture of Italy-based international engineering contractor Saipem and leading Indian infrastructure firm AFCONS, is undertaking the design and execution of the jetty structure.

The 1,380-metre-long structure, which extends finger-like into the Sea of Oman, is itself a major feat of maritime engineering. Around 500 piles have been placed on the trestle and the jetty platforms will be constructed. Berthing pockets with a draft of -25 metres will allow for the docking of a new generation of ultra-large ore carriers which are being owned and operated by Oman Shipping Company. Van Oord of The Netherlands, one of the worlds leading dredging companies, has dredged the approach channel and berthing pockets, having deployed one of the worlds largest dredgers at the site.

Significantly, the jetty project will take Sohar into the ranks of only a select handful of ports in the world with such deepwater capability. SIPC, with the support of the contracting consortia involved, are working towards a very ambitious schedule to bring part of the jetty into operation to coincide with the scheduled commencement of Vale Omans pelletising activities.

Bulk commodities terminalAlso under development is a new Bulk Terminal for Aggregates and Minerals. This project has been conceived in line with SIPCs vision to catalyse industrial-scale investment in mining, quarrying and mineral processing activities across the Batinah region, using Sohar as a gateway and international hub for trades in bulk commodities.

The bulk terminal, featuring a water depth of -16 metres, is being built as a separate extension of the 1,380-metre-long deepwater jetty project. A 220-metre-long length adjacent to the jetty-trestle is being earmarked for the development of the bulk terminal catering to bulk imports and exports of aggregates, as well as other possible commodities like limestone, coal, cement, copper concentrates, and chromite, among other mineral ores. The bulk terminal, serving both import and export cargoes, will

Port of Sohar:Looking to the future



have a capacity to handle 6-10 million tons of aggregates and dry bulk commodities per year.

While SIPC will develop the jetty infrastructure, an internationally renowned operator will be invited to invest in the terminal superstructure, such as loaders and unloaders, terminal buildings, and utilities.

Pending the completion of the bulk terminal, targeted for completion by the first quarter of 2012, SIPC already has earmarked a 250-metre length of an existing quay wall, for the temporary handling of aggregates and bulk commodities .The operator will also have access to open yard space lying behind the quay wall, which can be used as temporary storage pending the development of the dedicated stockyard within the industrial port. The objective is to enable the early commencement of dry bulk terminal operations at the Port of Sohar immediately upon the award of an operator license.

The bulk terminal is expected to position Port of Sohar as a hub for aggregates, mineral ores and other dry bulk commodities. It is also set to stimulate the growth of the aggregates industry in the hinterland of the port. Large volumes of aggregates are currently shipped to Qatar and Bahrain, among other markets, where a construction boom is underway. With the construction of a dedicated dry bulk jetty, authorities envision a growth in quarrying and mining activities along the Batinah region.

Once terminal infrastructure for bulk imports and exports is in place, investments in upstream and downstream elements of the business chain are expected to flow into Sohar and the wider

The 1,380-metre-long deep water jetty, which extends nger-like into the Sea of Oman, is itself a major feat of maritime engineering

Batinah region, particularly the Freezone Sohar initiative being developed alongside the industrial port.

Additionally, the project has huge implications for employment generation. Significant numbers of jobs will be created across the business chain, extending from quarrying and mining to processing and value addition, and transport and logistics. This is in addition to the thousands of jobs created during the implementation phase of both jetty projects.

Bitumen jetty and grain terminalAlso on the anvil is a pair of dedicated terminals for the handling of bitumen and grain projects that promise to further underscore Sohar Ports all-round capability.

The bitumen jetty is proposed to be built along the Southern Breakwater not far from where a string of liquid jetties are currently in operation. While one side of the proposed bitumen jetty will be designed to berth bulk carriers discharging feedstock for bitumen processing, the other side will handle ships calling at Sohar to load shipments of the finished product. A feasibility study covering the design, capacity and features of the bitumen jetty is currently underway.

At the behest of a major flour mill, SIPC is also studying the potential for a grain terminal and jetty equipped to handle all kinds of grain commodities. The facility, proposed to be built at the future container terminal, will be designed both for import and export cargoes. Terminal infrastructure and capacities will be based on the clients requirements.

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and development are prestigious ventures, such as the Sohar Airport, Batinah coastal road, Batinah Expressway, Freezone Sohar, and the Oman National Rail Project all of which have important beneficial implications for the industrial port.

Rail connectivityPlans for a national rail system integrated with a GCC-wide railway network augur well for Port of Sohars ambitions to emerge as a gateway to the Gulf region. As a key junction on the Batinah stretch of the national network, Port of Sohar will be linked by rail not only with Muscat and other growth centres, but also the UAE and other Gulf markets. Consequently, the business-related ramifications for the ports industrial and logistics tenants are potentially huge.

A special Interface Management team is working to ensure that Port of Sohar and its tenants are able to capitalise on the opportunities that come with rail connectivity. While some of the logistics terminals and industrial projects enjoy relatively easy rail access, others are constrained by lack of access and other shortcomings issues SIPC is working to address in close cooperation with the Ministry of Transport and Communications, and the Supreme Committee for Town Planning.

Infrastructure upkeepIn line with its obligations under the terms of the Concession Agreement, SIPC is gearing up to ensure that port infrastructure, including the breakwaters, jetties, roads and corridors within the concession area, remains ship-shape and in good order.

Facilities that have suffered damage in past adverse weather events are the subject of a major maintenance programme to be funded entirely by SIPC. Key among these are the breakwaters, which are critical to the continued well-being of the port. Both breakwater arms suffered some damage during Cyclone Gonu in 2007. Several core-locs, which provide the principal defence against tides and surges, have been displaced, damaged or lost altogether. SIPC and the Ministry of Transport and Communications commissioned an international company specialising in core-loc services, to carry out an assessment of damaged core-locs. Using various technologies, the firm pinpointed and photographed every core-loc that required reinstating, along with coordinates of their precise position on the breakwater. Engineering studies, followed by a contract tender, will commence in 2011.

Another key project in hand centres on a plan to strengthen the embankments in and around the port by placing rip-raps along some slopes. This initiative will be pursued in tandem with a project for the construction of a road along the Southern Breakwater designed to provide convenient access to existing and future jetties built on this arm. The road project will be funded by the government.

Also falling within SIPCs purview is the task of managing the public corridors linking the port with Freezone Sohar and Sohar Industrial Estate. A suitable management strategy will be formulated to ensure smooth and unhindered access for users, traffic and goods between the three entities.

Other projects in hand include the paving of graded roads within the concession area, improvements to existing carriageways, street-lighting, and fencing.


New gatePerhaps the most striking of the many projects lined up for implementation over the next five years is a proposal for a new gate facility. Far from being just an entryway into the port, the gate will be designed aesthetically and functionally to provide visitors with a foretaste of Port of Sohars world-class outlook. It will also be an edifice in itself, imposing and suitably built to cater to future demand growth in passenger, vehicular and goods traffic in and out of the port.

A dedicated team from SIPC is currently working with all the key stakeholders, notably the Ministry of Transport & Communications and Royal Oman Police (security and customs), on issues concerning a suitable location for the gate and its overall design features. For its part, SIPC is keen to ensure the facility is suitably designed and built to meet its core objective of facilitating the smooth, safe and convenient passage of people, vehicles and goods through the port. Towards this goal, SIPC is undertaking traffic analysis studies, cargo movement forecasts, and other simulations to design a future-proof structure.

Vision 2030 master-planWith most of the key components of its original master-plan now already a reality on the ground, SIPC is undertaking a comprehensive review and upgrade of this important blueprint. The revised master-plan will provide a new roadmap for the development of SIPCs concession area over the next 20 years through to 2030. It will be integrated with the broader master-plan for the development of the wider Batinah region.

In drawing up a strategy for the ports future development, SIPC specialists are carrying out a detailed spatial planning exercise of the concession area, together with simulations of cargo growth forecasts, investment trends and other indicators. This roadmap will help throw light on the ports future requirement for new infrastructure, such as jetties, terminals and corridors. Opportunities for future investment in new industries and services can be ascertained as well.

Importantly, the new Vision 2030 master-plan will also explore opportunities and synergies that will emerge as a number of major infrastructure schemes are implemented in Sohar and elsewhere along the Batinah coast. In various stages of design

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Entrenching a culture of safety

The Port of Sohar has a vision tocreate and maintain a healthy, safe, secure and environmentally friendly

setting for all stakeholders

P ORT OF SOHAR IS DEVELOPING INTERNATIONALLY recognized and in some respects truly innovative systems and policies in support of its Health, Safety, Security and Environment (HSSE) objectives. These systems and policies seek not only to ensure strict compliance with all relevant local laws and safeguards with regard to Health, Safety, Security and Environment, but to surpass them as well. By championing international best practices within and around the concession area, Port of Sohar aims to be the standard-bearer in the safe, responsible and sustainable operation of large-scale industrial complexes.

At the core of Port of Sohars HSSE policies is a vision to create and maintain a healthy, safe, secure and environmentally friendly setting for all stakeholders tenants, employees, visitors, service providers, and the local community. Integral to this objective is a comprehensive strategy to minimize, mitigate and ultimately eliminate all risks associated with the potentially hazardous industrial activities of the ports tenant community. This strategy is being pursued in close collaboration with all stakeholders, notably the Royal Oman Police Civil Defence, Ministry of Environment and Climate Affairs, and Ministry of Health.

Emergency Response Preparedness is a key objective of the ports HSSE management strategy. A dedicated team within the HSSE Department continues to develop, formulate, fine-tune and implement emergency response procedures that take into account the diverse and complex activities of individual industries and logistics service providers. These initiatives are planned and implemented in lock-step with the Civil Defence, local and regional emergency response agencies, and the tenants themselves.

In an effort to preserve its exemplary safety record, SIPC continues to implement measures that help prevent mishaps and accidents. The ports ability to respond to contingencies is constantly appraised through audits, drills, simulations and risk assessment exercises. This is typically done in partnership with the Sohar Environmental Unit (SEU).

Set up under the auspices of the Ministry of Environment and Climate Affairs, the SEU has been working closely

with SIPC in the formulation of a long-term environmental management strategy. The object of this strategy is to introduce and sustain internationally recognized environmental safety standards at the port, with funding support not only from SIPC and the tenant industries, but also from the local authorities and national government.

Delivering quality and effective healthcare is another key goal of SIPCs HSSE-related efforts. Healthcare services are made available through a combination of centrally provided facilities through the Sohar Industrial Port Clinic and services offered directly by the industries themselves. The HSSE team is now looking at enhancing the delivery of comprehensive healthcare services in an efficient and cost-effective manner.

Emergency healthcare will be a key component of SIPCs broader healthcare delivery strategy. Following a detailed review of the availability of emergency medical services within the concession area, efforts are now underway to enhance the ports capability to handle mass trauma incidents at the port. This will necessarily require the utilization of resources, as well as the services of government agencies operating outside the limits of the industrial port. Any eventual effort to build an effective emergency medical response capability will also take into account the needs of the Greater Sohar Industrial Area.

In line with its goal of entrenching a culture of safety at the port, SIPC has decided to annually host a major seminar on Industrial Safety. The workshops will focus on Emergency Preparedness and the management of a Major Incident. Delegates will discuss scenarios that constitute a Major Incident at the Port of Sohar, likely causes and potential consequences, and the domino effect that such disastrous developments have within large industrial complexes. Importantly, the seminar will also deliberate on ways to mitigate, manage and recover from major incidents. Case studies illustrating positive and negative outcomes of major incidents occurring at industrial complexes elsewhere around the world will be presented as well.

Entrenching a culture of safety


Standing sentinel over the environment

OVERSEEING ENVIRONMENTAL SAFETY AT the Port of Sohar is the Sohar Environmental Unit (SEU), a special outfit set up under the auspices of the Ministry of Environment and Climate Affairs. The Units establishment follows the signing of an agreement in May 2008 between the Omani government and DCMR Environmental Agency Rijnmond, the Dutch environmental protection agency overseeing environmental standards around the Port of Rotterdam in the Netherlands.

Conceived as a dedicated environmental protection agency for Sohar, the SEU is tasked with introducing international environmental safety standards in the industrial zone around Sohar. Its mandate is to address all issues related to the environment air pollution, ambient air quality, waste issues, and all water-related issues, covering cooling water discharge and wastes discharged into the marine environment.

The SEUs responsibilities cover the following broad objectives:

To protect the environment and local inhabitants To formulate and strengthen environmental safety and management guidelines

Ensure compliance with environmental regulations and standards

Monitor and enforce regulations through a regime of regular inspections

To collect and analyse environmental samples Undertake environmental licensing and permit functions

Review and update policies Support cooperation with both local and international agencies

Human resource trainingThe scope of the SEUs activities covers the following areas:

Air and noise pollution control Waste management and pollution control Soil and ground water pollution control

Wastewater pollution control Climate and energy management Safety and Emergency Response Preparedness Marine and coastal management Chemical and radioactive pollution control

An electronic emissions monitoring system will soon come on line around the industrial port, enabling efficient and round-the-clock monitoring of the natural environment. The Unit is also in the process of establishing a 24-hour Operations Room suitably equipped to respond to pollution-related contingencies.

The SEUs capabilities are being progressively ramped up in line with its expanded mandate which now includes the adjoining free zone and other industries operating in the wider Sohar area. The size of the Units inspection team is proposed to be increased from the present six inspectors to a total of 20 in the future.

As a partner in the initiative, Rotterdam-based DCMR is supporting the Omani government in the formulation of environmental policies and standards governing industrial activities in and around the Sohar port. It is also committed to providing technical expertise and personnel towards the staffing and operation of the SEU.

Founded in 1972, the DCMR oversees environmental protection issues in the larger Rotterdam region of the Netherlands, a heavily industrialised area with refineries, waste incinerators, waste dumping sites, many large chemical plants, metallurgy, food processing plants and about 19,500 smaller companies. The DCMR issues permits to virtually all of the 22,000 enterprises in the area and carries out more than 9,000 inspections to monitor compliance with the permit conditions. It supervises and monitors clean-up programmes to minimise the impact of soil pollution, waste disposal and noise.


Sohar Environmental Unit


Sohar setsthe standard

Port of Rotterdam

A FTER THE SUCCESSES IN OMAN, PORT of Rotterdam is aiming for four new participations, comparable to Sohar, and cooperation abroad with ten multinationals, such as the Brazilian multinational Vale.After the Second World War, the Port of Rotterdam worked hard to help developing countries in terms of port development. This occurred primarily through training and consultancy. Since the nineties, the Port Authority has also been making knowledge available commercially to ports. When, in 2002, participation began with the Sultanate of Oman, the Port Authority concentrated its foreign activities on the port of Sohar. CEO Hans Smits of the Port of Rotterdam Authority: Our participation in the Sohar Industrial Development Company and the results of it, have surpassed our expectations on all three terrains defined at the start. Our customers in Rotterdam get the opportunity to expand internationally in ports with standards they are used to. The other way around, they and the port management acquired much market information and contacts profitable for our home port. Last but not least, a considerable number of our staff have gained international experience and skills

in a challenging situation. Challenging, because of the greenfield character of the project, its size and its speed of realization. Moreover, it can be created in a stable political, social and financial situation with a local staff of high quality and motivation. In short: the dream of every port developer. We are proud with what we have realized together with our Omani partners so far and more is to come. In Oman we created a second show case for further international expansion. The Port of Rotterdam International Department was set up to this end three years ago and nowadays, it is also active beyond the Middle East.

In the next five years, the Port of Rotterdam therefore wants four new international participations and ten strategic partnerships. Ports in emerging economies such as India, China and Brazil are potential candidates here. Meanwhile, PORint has accumulated a lot of knowledge over the last few years in India. It took care of the business plans for the twelve largest ports and stayed in the country for several months to analyse the opportunities for the green port project Port West. These activities eventually led to concrete plans for participation in a greenfield port in the federal state of Maharashtra, in a fine location.

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This involves the first real deep sea port on the west coast. We are investigating possible participation in close consultation with one of the largest companies in India. We are also eager to work with them in Rotterdam and Brazil, says Roger Clasquin, director of PORint.

SuapeSince 2008, Rotterdam has been working on a joint venture with Suape, a port near Recife in Northeast Brazil. Recently, the Port Authority provided a second opinion for the masterplan and the business plan for this port. The ultimate goal of these paid commissions is the realization of a participation. Suape remains very promising, says Roger Clasquin without going into concrete details. We are not the only ones who determine the speed. We are quite hard to please when it comes to the preconditions.

For years now, Brazil has been enjoying massive economic growth. With its natural riches, oil finds, but also the World Cup in 2014 and the Olympic Games in 2016, it is storming into the 21st century. But the ports suffer from a shortage of capacity and a hopelessly complex institutional organisation. Now everything goes to Santos, as Clasquin knows. That is the continents largest port but Santos is full and has limited opportunities for expansion and hinterland connections. Theyll have to forget about that idea. How do you change the entire port sector in such a way that they are ready to process future cargo flows in an efficient way? The government has launched an overarching strategic study into the 34 Brazilian public ports along the 8,000 kilometre coastline. The Port Authority is supervising the project, handling the transfer of know-how and testing the plans.

In a years time, the Plano National de Logistica Portuaria will be ready. Roger Clasquin already has visions of a new Brazilian industrial port, based on the Rotterdam model as in Sohar.

The cargo flows will, in all probability, be big enough for the immediate development of a new port in which the strategic recommendations are put into practice. Other plans involve Romania, China and South Africa.


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petrochemicalscluster

The Port of Sohar has gone further than any other industrial park in the

Sultanate in supporting the realisation of the governments key

objective of adding value to the nations hydrocarbon resources.

The industrial port hosts the countrys biggest petrochemicals hub,

comprising a mix of rening, processing and downstream

petrochemical schemes. The largest of these investments

the world-scale Sohar Renery is also a source of feedstock

for two co-located downstream ventures

Oman Polypropylene and Aromatics Oman.

in focus:Sohar Renery >

Oman Polypropylene >Aromatics Oman >

Oman Methanol Company >Sohar International Urea & Chemical Industries >

Air Liquide Sohar Industrial Gases >


THERES MORE TO SOHAR REFINERYS IMPORTANCE than just a strategic investment in a project that secures the nations fuel requirements. As a primary source of intermediate petrochemical products, it also has the potential to catalyse the growth of downstream industries on a significant scale investments that promise to create more jobs and drive socio-economic development.

Ensuring Sohar Refinerys long-term ability to deliver on both counts refined petroleum fuels for the domestic market, and feedstock for secondary petrochemical units is thus an important task at hand for Omani authorities. To this end, the government has embarked on a major effort to integrate the management and operation of Sohar Refinery and its two downstream spin-offs Oman Polypropylene and Aromatics Oman. The objective is to create a unified refining and petrochemicals enterprise that fully capitalizes on inherent synergies that inevitably flow from an integrated operation.

Commissioned in 2006, the Sohar Refinery complex is itself the focus of a major modernization strategy aimed at boosting its ability to meet its feedstock supply commitments to nearby downstream petrochemical schemes.

The planned upgrade will also lead to the optimisation of the refinerys configuration, thereby maximising the output of refined products, feedstock, and other petroleum byproducts.

Envisaged is a significant upsizing of the Sohar refinerys processing capacity aimed at boosting the output of gasoline and diesel to meet current and future domestic demand. Significant volumes of bitumen, principally used for road-surfacing, will be produced as well.

An upgrade carried out in tandem with this expansion will also allow for Sohar refinery to provide Oman Polypropylene and Aromatics Oman with all their feedstock at the desired specs.

Several major processing units, including a crude distillation

unit, isomerisation unit and hydro-cracking unit, will be added to the refinery complex as well. Undoubtedly, the upgrade will reinforce Sohar Refinerys standing as the nations flagship refinery. Set up with an initial capital investment of $1.35 billion, the complex features a Crude Unit with a capacity of 116,400 barrels per day (bpd) and a Residue Fluid Catalytic Cracking Unit (RFCCU) of 75,260 bpd capacity.

Output includes a wide range of refined petroleum products, including regular and premium gasoline, kerosene, LPG, propylene, naphtha, low-sulfur gas oil, fuel oil and granulated sulfur. While a fifth of its production is earmarked for domestic distribution, the remainder is exported to international markets.

As a mother plant, the Sohar refinery is integrated with Oman Polypropylene located next door, providing propylene as feedstock for the latter. It also supplies straight-run naphtha as feedstock for the giant petrochemicals scheme of Aromatics Oman. This integration results in savings in capital investments and allows all the parties concerned to exploit synergies inherent in their operations.

Recently, Sohar Refinery announced a considerable enhancement of its operational performance the result of an intensive Plant Reliability and Operability Improvement Programme launched in 2008. That initiative, combined with a major turnaround carried out early in 2010, boosted the plants Operational Availability, which is a key indicator of the refinerys overall reliability, to a record 99.7 per cent for the first time since its commissioning four years ago. Average Plant Utilization covering all units and utilities reached a high of 82.2 per cent, while the corresponding figure for the two refining units topped 93 per cent for the first time as well.

The new performance benchmarks underscore ongoing efforts by the company to address any technical and operational issues that come in the way of realising the full potential of one of the most strategic of Omans petrochemical ventures.

Catalysing petrochemicalspinoffs at Port of Sohar

Sohar Renery

Sohar Renery complex is the focus of a major modernization strategyaimed at boosting its ability to meet its feedstock supply commitmentsto nearby downstream petrochemical schemes



P.O. Box 474, Postal Code 322, Falaj Al Qabail, Sultanate of Oman

Tel.: +968 2686 5800 Fax: +968 2685 0540

Email: [email protected] Website: www.omanmethanol.com


World-scale ambitionCOMPLETING ONE FULL YEAR OF SUCCESSFUL operations, Aromatics Oman is now poised to play a major role in fuelling the growth of the downstream petrochemicals sector at Sohar. The companys principal products paraxylene and benzene are key intermediate petrochemicals that have the potential to be processed into a range of commercially valuable products.

Aromatic Omans mission is to be a premier aromatics complex equipped with state-of-the-art technology to produce the best quality benzene and paraxylene, and other related products. The company aims to be a strategic partner in the nations development by making available feedstock for downstream ventures, thereby contributing to employment generation and ancillary business investment.

Established at a cost of $1.68 billion, Aromatics Oman is a truly world-scale venture. The giant complex boasts the worlds largest grassroots paraxylene plant at a record-beating 819,000 tons. It also produces 210,000 tons of benzene per year. The project is also integrated with Sohar Refinery, which provides part of its feedstock requirement of straight-run naphtha.

A key feature of the AOL venture is its extensive use of state-of-the-art technology. The principal technology has been supplied by world-leader Axens, which has licensed its proprietary know-how to aromatics projects internationally. The plant began commercial production in September 2009, exporting its first cargoes of paraxylene and benzene in December that year.

A plant performance test run conducted early in 2010 was found to achieve all benchmark guarantees provided by process licensor Axens Technology of France, and the EPC contractor GS Engineering and Construction from South Korea. All units ran at 100 per cent capacity, demonstrating the plants ability to be operated at full capacity in its present design, and produce on spec paraxylene and benzene, besides liquefied petroleum

gas, light naphtha, raffinate and heavy aromatics as additional by-products.

Besides adding value to Omans hydrocarbon reserves, Aromatics Oman has the potential to stimulate downstream spin-off investments on a major scale. Paraxylene and benzene are intermediate petrochemical products with significant industrial potential. Paraxylene is primarily used as a basic raw material in the manufacture of purified terephthalic acid (PTA) and dimethyl-terephthalate (DMT). While PTA is used in the manufacture of a variety of polyethylene terephthalate (PET) polymers, DMT is a raw material in the manufacture of polyesters which in turn are used to produce, yarn/fibres and films.

PET bottles are widely used for carbonated beverages because they are light-weight, shatter-resistant and possess high tensile strength. Polyester uses include carbonated and non-carbonated beverage containers; containers for household chemicals, toiletries, cosmetics; fabrics for curtains upholstery and clothing; microwave oven packaging material; films for X-rays, magnetic tapes, photographic film and electrical insulation; and packaging for boil-in bags, processed meats, shrink films and blister packs.

Industrial applications linked to the use of benzene are equally diverse. It serves as a key basic chemical in the manufacture of a wide range of intermediate products, including cyclohexane that makes nylon. Nylon is used in everyday items such as stockings, rope and plastic toys. Benzene can also be used to make styrene which is used to manufacture polystyrene and rubber products.

Aromatic hydrocarbons like cumene and phenol made from benzene can also be processed into healthcare products, such as aspirin. Furthermore, benzene is widely used in the production of linear alkyl benzene, which is a key ingredient in the manufacture of soaps and detergents.

Aromatics Oman


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In fact, Oman Oil Company, which is the

major shareholder in Aromatics Oman, is

actively exploring opportunities for value-

adding petrochemical spinoffs. The state-

owned investment vehicle is in discussion

with a number of potential partners and

strategic investors in this regard.

One such project under study involves a

proposal for setting up a major purified

terephthalic acid (PTA) plant downstream

to Aromatics Oman. Indian petrochemicals

manufacturer JBF Industries Limited

announced early in 2010 that it had signed a

Memorandum of Understanding with Oman

Oil Company for the establishment of the

plant at the Port of Sohar.

The MoU envisions an international-scale

project capable of producing 1.2 million

tonnes per annum of PTA, a key ingredient

in the manufacture of polyethylene

terephthalate (PET), one of the most

commonly used food grade packaging

polymers with wide application in the

mineral water, soft drinks, APET sheet and

pharmaceutical industries. JBF Industries said

the proposed PTA project would source its

requirement of paraxylene from Aromatics

Oman via a pipeline network.

O MAN METHANOL COMPANY (OMC) HAS been regarded since its inception in 2004 as a key player in the growth of the port. It is an Omani company, which has already gained for itself a worldwide reputation for quality and technical innovation.. The ownership is shared by Omzest Group, one of the most powerful and prestigious groups in the Sultanate and Methanol Holdings International Ltd, owners of Methanol Holdings Trinidad Limited.

OMC was constituted in the early days of the ports growth back in November 2004, and has ever since played a constructive role in what has become, a rapidly growing community. The project moved swiftly from Financial Close in 2005 with the co-operation of KfW IPEX Bank, Germany, thus from the beginning establishing itself as a powerful

and well connected financial entity. Marketing is managed by Helm AG both out of Hamburg and Hong Kong.

Methanol is a product used throughout the world on a daily basis by many millions, but few people are aware or its vital role. Many have never even heard of it although they use methanol based products on a very frequent basis. It is used in the production of Formaldehyde, Polyester, Acrylics and Methylamines, and thus has applications used in downstream products worldwide.

OMC is not only registered as an Omani company, but has its headquarters and plant within the gates of the fast growing Port of Sohar, The Plant is a world scale single stream plant. It produces in excess of 3,000te a day of methanol. It uses Low Pressure Methanol technology licensed from Johnson Matthey plc. Its engineering and designing comes from Toyo Engineering Corporation of Japan.

Pivotal role for Oman


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The first methanol from the plant was produced back in September 2007, and well before the end of that year its product was first exported to the world market. Since then methanol has been delivered to very many markets with the product being shipped as far afield as Japan and Rotterdam by ship. Locally it is shipped to customers by pipeline.

Now Oman Methanol Company has two long term charter vessels from Garnet, a joint venture between Gulf Energy Maritime and Omzest. Importantly there is a 100 per cent off take agreement with Helm AG of Hamburg, which is managed both out of Germany and Hong Kong.

It is however used in the field of energy, directly blending into gasoline and diesel. It is also used in the manufacture of Biodiesel, also used in fuel cells, and to manufacture DME which is blended into LPG.

Apart from the product itself Oman Methanol Company

strives to deliver the highest possible standards when it comes to observing Safety, Health and Environment Standards. It also pays great attention to education and the local community development. There are integrated on the job training programmes linked to excellent training facilities, The company also works with the Ministry of Education, Universities and other educational establishments , with educational support programmes designed for the benefit of both interns and summer students.

It also has a Community Support policy, which seeks to meet not only Safety Health and Environment policies. This is designed to resonate in the local region, in the chemical industry, and in the overall education and training environment of the region. Oman Methanol thus has the mission to be a good neighbor both within the Port itself and in local and regional communities.

Methanol Company


Oman Methanol Company


Sohars beacon to downstreaminvestment

O MAN POLYPROPYLENE, THE countrys first downstream petrochemicals project, serves to showcase investment opportunities in secondary and tertiary processing ventures that add value to the nations hydrocarbon resources. Thanks to the groundbreaking success of the polypropylene venture, the Port of Sohar has already attracted a fair share of petrochemical schemes either downstream to the flagship Sohar Refinery or its secondary spinoffs.

The $313 million polypropylene project, which commenced production in July 2006, consists of a two-train, 340,000-ton capacity plant that receives propylene as feedstock from the adjoining Sohar Refinery. The projects Luban brand of polypropylene is exported to markets across the world, chiefly in Asia and the Gulf region.

Although roughly 90 per cent of the plants production is exported at present, the company is keenly exploring opportunities for the utilization of part of its output for value added processing within the country. Towards this end, it is working with Takamul Investment, a government-owned start-up company tasked with supporting investments in downstream industries. Takamul has plans to develop a dedicated zone at the nearby Sohar Indsutrial Estate to house polypropylene-based spin-off industries.

Significantly, advanced Novolen technology allows Oman Polypropylene to maximise the possibilities associated with polypropylene production to cater to a wide spectrum of market requirements. Polypropylene has a wealth of applications and is currently one of the fastest growing polymers among all other standard plastics.

Reputed as the most versatile of all thermoplastic materials, polypropylene is used in the manufacture of products of everyday use, such as bottles,

furniture, blow moulded containers, transparent household storage containers, fibres, filaments, woven tapes, as well as in injection moulding and thermoforming. Its excellent stiffness makes it ideal for technical applications, such as in automotive and electrical appliances, as well as furniture, transport containers, and for use in thin-wall packaging.

Early in 2010, Oman Polypropylenes modern plant underwent a comprehensive turnaround aimed at sustaining its ability to operate at its design capacity, as well as to ensure its technical integrity and reliability in meeting all production targets.

As part of the extensive shutdown maintenance exercise the projects first since commissioning specialist teams inspected, cleaned and overhauled all critical equipment, including the static pressure vessels, heat exchangers, process filters, periodic testing and calibration of safety valves, critical manual valves and control valves. In parallel with the turnaround, two existing stainless steel powder discharge vessels were replaced with advanced carbon steel vessels.

Underlining its commitment to adhering to international benchmarks in the operation of the plant, Oman Polypropylene recently scooped a trio of prestigious certifications for the manufacture and marketing of polypropylene. The certifications in questions are: ISO 9001:2008 (Quality Management Systems), ISO 14001:2004 (Environmental Management Systems) and OHSAS 18001:2007 (Occupational Health and Safety Management System). These certificates, awarded simultaneously for the first time to an Omani company, were an affirmation of its pledge to abide by internationally recognized norms in the areas of quality, environmental management, occupational health and safety.

Oman Polypropylene


SIUCI


SOHAR FERTILISER PROJECT

SIUCI Committed to World-Class Performance

SIUCIs Sohar Fertiliser Project, with a production capacity of over 1.2 million

tonnes per annum of Granular Urea, is one of the largest private sector

green-field fertiliser projects in the world and represents one of the

largest industrial investments by an individual in the GCC.

Deep Rooted Commitment to the Industrial Growth of the Nation

SIUCISohar International Urea & Chemical Industries SAOC

P.O. Box 3352, PC 112 Ruwi, Sultanate of OmanTel : (968) 24562631, Fax : (968) 24562731

E-mail: [email protected]



Leading nationalprivate sector industry

Sohar International Urea & Chemical Industries SAOC

THE SUCCESSFUL START UP OF SOHAR INTERNATIONAL Urea & Chemical Industries (SIUCI)s Ammonia/Urea Fertilizer Complex during 2009 has entrenched Omans place amongst the leading suppliers of Urea in the world. The achievement is remarkable since

the Sohar Fertiliser Project is not only one of the largest green field private sector fertilizer projects in the world but also one of the largest industrial investments by any individual within the GCC.

The venture, promoted by prominent Omani businessman Sheikh Suhail Salim Bahwan, employs state-of-the-art technologies to produce 2000 metric ton per day (MTPD) of Ammonia and 3500 MTPD of Urea and is world class in terms of scale of production, environmental protection, safe practices and energy consumption. Ammonia is produced from the natural gas supplied by Oman Gas Company to the complex. The ammonia thus produced is reacted with carbon dioxide in the Urea plant to produce high quality Granular Urea.

Urea is exported globally from the dedicated berth allocated to SIUCI at the Sohar Industrial Port. To preserve its high quality, Urea is transported to the berth through enclosed conveyors and loaded into the ship by a remote-controlled mechanized ship loader. During material handling and shipping operations, utmost care and hygiene practices are adopted to ensure the quality of urea loaded into the ship.

The main markets for SIUCI Urea are the USA, India, Australia, Thailand, Latin America, South Africa and Pakistan. Within eighteen months of operation, SIUCI has established an excellent reputation as a producer of high quality urea. SIUCI Urea is recognized by discerning buyers all over the world, thereby creating a strong demand for SIUCIs product.

Urea is the most widely used nitrogenous fertiliser as it contains 46% Nitrogen by weight, which is the highest proportion among solid nitrogenous fertilisers. Urea is the main fertiliser input for growing various crops such as rice, wheat, corn, pulses and vegetables. Urea is also used in the manufacturing of chemicals such as melamine, urea formaldehyde chemical, adhesives and resins. The urea formaldehyde unit located in Sohar Industrial Port area uses SIUCI urea for its production.

A number of important socio-economic benefits are the outcome of SIUCIs project, the foremost being SIUCIs contribution to the strategic national objective of industrial diversification by reducing the Nations dependence on oil revenues. Considerable foreign exchange earnings are generated from export of Urea. Further, with the projected growth in Sohar Industrial Port area and surrounding infrastructure, there is good opportunity for development of downstream industries.

Employment generation for Nationals is another significant outcome of this project. Right from the beginning, SIUCI has been committed towards the development of technical skills of young Omanis. About 70 young technically qualified Nationals have been inducted since 2006 as technical trainees and after two years of extensive training including at the project site, they are contributing significantly in various functions such as the operation and maintenance of the Ammonia plant, Urea plant, Utilities and Product Handling as well as in the Laboratory, Technical Services and Materials Management.

In addition to these technically qualified nationals, nearly 100 more nationals have been recruited in various non-technical functions.



Health, Safety and Environment (HSE) enjoys highest priority at SIUCI right from inception through tendering, design, engineering, construction, commissioning and operation & maintenance. SIUCI has set zero accident as its target and have cultivated excellent HSE culture within the organization. Compliance with regulations, continuous environmental monitoring, safe work practices, good housekeeping are some of the hall marks of SIUCIs HSE culture.

SIUCI has made adequate arrangements for further growth by acquiring additional land, reserving seawater capacity, providing cushions in capacity of critical equipments. Given an opportunity, SIUCI is committed to repeat its performance which will further enhance Omans position as the leading quality supplier of Urea to the world.



Synonymouswith safety

Air Liquide Sohar Industrial Gases LLC

SAFETY AND RELIABILITY OF SUPPLY CONTINUE TO be the hallmarks of Liquides successful operations at the Port of Sohar. These twin traits have long exemplified the business philosophy of a global industrial gases group whose products have been indispensable to the safety and stability of operations at some of Sohars biggest industrial and petrochemical projects.

Air Liquide is the world leader in gases for industry, health and the environment. The Groups technological expertise, global capabilities, and impeccable credentials have cemented its international reputation as a dependable supplier of industrial gases.

In Oman, the Group is a majority shareholder in Air Liquide Sohar Industrial Gases LLC (ALSIG), which was established in 2005 to operate and manage a state-of-the-art gases plant at the Port of Sohar. Air Liquides partners in ALSIG are the well-established Omani firms ORPC (Oman Refineries & Petrochemicals Company), MHD (Mohsin Haider Darwish LLC) and OMZEST (Omar Zawawi Establishment).

Now into the fifth year of operations, ALSIG has made impressive strides as the principal supplier of industrial gases chiefly nitrogen to a growing customer base. ALSIGs clientele includes Oman Refineries and Petrochemicals Company (ORPC), which owns and operates the Sultanates flagship oil refinery at Sohar, as well as the countrys first refinery at Mina al Fahal in Muscat. A high-tech gases plant set up by ALSIG within the industrial port now supplies nitrogen gas to ORPCs Sohar refinery, among other prestigious consumers, via a dedicated pipeline network. In Muscat, a captive plant meets the Mina al Fahal refinerys nitrogen gas requirements.

The time is opportune now for ALSIG to expand capacity and diversify its product portfolio, says General Manager Rony Chaccour. At the outset of our operations, our priority was to serve industries in Sohar Port through long-term supply agreements. This was in line with our strategic investment plans right since ALSIGs inception. Now, our aim is to expand the network and build our customer base by adding oxygen and hydrogen production facilities to our manufacturing capacity. In part, these expansion plans are designed to meet



the new requirements of ORPC when it brings on stream its upgraded refinery complex at Sohar, states Mr. Chaccour.

At the heart of ALSIGs successful business model, the GM explains, is an efficient, reliable and high-tech operation that ensures competitive cost advantages to customers. By securing their gas requirements from ALSIG, industrial consumers can not only focus on their core business, but they also enjoy the solid assurance of safety and dependability that comes with the Air Liquide brand.

In terms of safety, ALSIG has a Zero Lost Time Incident record a milestone we intend to maintain. Our customers will also vouch for the superb reliability of our gas supply which remains at a constant 100 per cent. Moreover, the quality of our products exceeds our customers requirements, the GM proudly adds.

In a testament to its sound technical capabilities, ALSIG successfully met ORPCs requirements of huge volumes of nitrogen gas during turnaround operations at the Sohar refinery early in 2010. Further capacity expansions are

envisioned particularly if new industrial consumers are added to the companys customer base in the near future. Longer term, the company has plans to develop new facilities at Duqm, on the Sultanates Wusta coast, where a huge industrial and petrochemicals hub is on the anvil, says Mr. Chaccour.

Air Liquide is the world leader in gases for industry, health and the environment, and is present in over 75 countries with 42,300 employees. Oxygen, nitrogen, hydrogen and rare gases have been at the core of Air Liquides activities since its creation in 1902. Using these molecules, Air Liquide continuously reinvents its business, anticipating the needs of current and future markets. The Group innovates to enable progress, to achieve dynamic growth and a consistent performance.

Innovative technologies curb polluting emissions, lower industrys energy use, recover and reuse natural resources or develop the energies of tomorrow, such as hydrogen, biofuels or photovoltaic energy Oxygen for hospitals, homecare, fighting nosocomial infections Air Liquide combines many products and technologies to develop valuable applications and services not only for its customers but also for society.

With a Zero Lost Time Incident

record and 100 per cent supply

reliability, ALSIG is well placed

to expand and diversify operations

to meet growing demand


metalscluster

Metallurgical projects held centre-stage at the Port of Sohar during

2010 with two major steel-related ventures coming into operation

late last year. Vale Omans giant iron ore pelletising plant, along with

Jindal-Shadeeds integrated steel mill, were the toast of the industrial

ports latest successes. With their launch, iron ore and steel now

join a trio of strategic commodities, along with aluminium,

at the heart of Sohar Ports metallurgical investments.

in focus:Vale >

Sohar Aluminium >Jindal-Shadeed Iron & Steel >

L&T Modular Fabrication Yard >L&T Heavy Engineering >

Sohar Steel >


Sohars new industrial paradigm

Vale Oman Pelletizing Company LLC

VALE OMAN PELLETIZING COMPANYS PELLETIZING project at the Port of Sohar is a testament to what a relatively small industrializing nation like the Sultanate can be capable of accomplishing. After all, Vale Omans is no ordinary investment. Its

pelletizing plant at the industrial port is a mineral processing behemoth of a complexity and scale without parallel anywhere in the wider region. Together with its huge stockyard and deepwater jetty, the $1.35 billion venture will position Oman as a major regional distribution hub serving steel mills across the Middle East, North Africa and Indian subcontinent.

For the Sultanate, the socio-economic and developmental spinoffs associated with the project are immense. The venture will not only create employment on a significant scale, but

it also has the potential to stimulate investment in upstream, downstream, ancillary and related industries across the business chain. Equally, it has the potential to put Oman firmly on the map of the worlds leading mineral processing nations.

Backing the giant project is Vale, a global mining conglomerate with operations in more than 30 countries across six continents. The Brazilian-headquartered Group is the worlds second largest diversified mining company in market capitalization. It is also the worlds largest producer of iron ore and pellets, and one of the largest producers of nickel, which is used to produce stainless steel, batteries, special alloys, chemicals and other products. The company also produces copper, manganese, ferroalloys, bauxite, alumina, aluminum and coal, among other raw materials important to the global industrial sector and present in people>s daily lives.



The Vale story in Oman dates back to December 2007 when the Group decided to open its regional representative office in the Sultanate as part of a strategy to strengthen its commercial ties with the steel industry in the Middle East. That marked the start of a strategic and mutually rewarding relationship, eventually paving the way for Vales landmark decision to select Sohar as a hub for its regional operations. In conjunction with that announcement, Vale also unveiled plans for the development of a new industrial complex at Sohar the conglomerates first international iron-ore greenfield investment outside of Brazil.

Construction work began in earnest in March 2009 on a sprawling facility comprising of a pelletizing plant of an annual capacity of 9 million metric tons of direct reduction pellets, as well as a distribution centre with a handling capacity of 40 million metric tons. Total investment in the project is estimated at $1.35 billion.

In addition, Vale has partnered with Sohar Industrial Port Company (SIPC), the port authority, in the construction of a two-kilometre-long deepwater bulk jetty at a cost of roughly $250 million. At this jetty, giant ore carriers arriving from Brazil will discharge their cargoes of iron ore, while bulk carriers will load cargoes of direct reduction pellets manufactured at Vales Sohar facilities and destined for steel mills across the region.

Rewarding partnershipsReflecting its bedrock philosophy of forging strong and substantive partnerships with host countries and key local players, the Brazilian Group offered a 30 per cent stake in Vale Oman Pelletising Company LLC to Oman Oil Company SAOC, a strategic investment vehicle wholly owned by the Government of Oman. The deal acknowledged the positive role played by the Omani government in providing the right business

environment for Vale to succeed in the Sultanate. Besides, it affirmed Vales commitment to supporting the countrys long-term economic and social development.

Indeed, Vales investment in Sohar is founded on four key pillars: fostering local economic development, creating employment for local Omanis, demonstrating leadership in social and environmental responsibility, and respecting local culture and traditions. These represent the cornerstone principles upon which Vales strategy for a sustainable future has been fashioned.

These principles are also reflected in Vales partnership with Oman Shipping Company (OSC) in the provision of maritime transportation services. Under the agreement of USD 500 million, OSC is building four Ultra Large Ore Carriers (ULOCs) each with a capacity of 400,000 tons, which will be used by Vale to ship its iron ore from Brazil to Oman. The ULOCs will rank among the largest ore carriers of their kind when they enter service over the 2012-13 timeframe.

Also reaping the benefits of Vales huge investment in Sohar are a number of small and medium-size Omani businesses. More than 200 firms ranging from contracting companies to vendors and service provider

Documents

Port of Sohar Magazine 2011, Issue 5