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Oman Invests $356 million in Transportation

Muscat, Oman : 30 July 2010

A recent rush of new contracts put through by the Ministry of Transport and Communications in Oman will boost spending in their transport infrastructure.  The 15 new agreements covered various aspects of infrastructure including land, air and sea and the signings in July totaled OR136.9 million ($355.9 million).

The largest portion of those investments is earmarked to overhaul two areas of the Nizwa-Thumrait road.  Al Nasr Al Arabia is responsible for reworking 325km of the road, along with the Gulf of Oman Company, spread over two contracts valued at OR56 million ($104.5 million).  Another OR35 million ($90.9 million) is to be invested in building new roads across the Sultanate.

When looking at single projects, the work at Muscat International, Salahah and additional local airports includes supplying and installing new equipment.  Indra landed this OR44.5 million ($116.5 million) contract.  Also, two contracts to serve consulting needs in the area’s maritime sector were awarded , including one with Bird Associates for OR260,000 ($675.300) to look at the breakwater damage being done at Sohar Industrial Port.

The recent projects in these sectors are on top of other large investments linking Oman’s latest industrial areas.  A contract worth OR27.6 million ($71.7 million) was awarded to Strabag Oman in late June aimed at constructing additional infrastructure at Sohar Airport. This is the same firm that signed last year’s OR37.5 million ($97.4 million) contract covering the first phase of work at Sohar.  A new project management contract should be awarded at the beginning of 2011 regarding the planned Oman National Railway, a 280 km rail running from Sohar to Muscat.

This railway will be crucial to the industry and urban areas in the Sultanate, offering services for freight and passengers.  The pre-qualifying phase of this multibillion-dollar project drew 32 interested firms from across the globe and closed in the middle of June.

Local media reports that the proposed railway network will include four different sections.  A section between Sohar and Muscat includes eight stations for passengers and more stops for freight.  A section from Muscat to Duqm will have two freight stops and nine stations for passengers.  A section between Sohar and Buraimi includes two freight stops and passenger stations at four stops.  Lastly, a section between Sohar and Khatmat Melaha will have one for freight and four stations for passengers.

In June a representative of the Supreme Committee for Town Planning spoke to the local press.  The general manager of urban planning, Salim bin Mohammed Al Affani confirmed that the specs for the new Oman railway network will be the same as similar projects being planned across the GCC as part of the proposed 1940 km railway network connecting the Gulf region.  Tracks will be made to handle high speed trains travelling up to 350 km per hour.  Initially, using the trains already on hand, the railway network will include passenger trains travelling at 200 km per hour and freight trains in the range of 80 to 120 km per hour.

A feasibility study done earlier in 2010 by the Ministry of Transport and Communications looked at the 306 km railway that will run between Oman and the UAE.  The entire project is projected to take seven or eight years and cover investments of over $100 billion from the Gulf region.  There is also talk of rail network connecting Oman and Yemen.

This investment level in the transportation sector will improve logistics in Oman for the future, allowing the Sultanate to have better access to global markets and boost trading relationships between Oman and other GCC states.  Currently Oman Air is having success with promoting their niche services to small city centers in the UAE.

The airline will soon introduce their feeder services to Al Ain in the emirate of Abu Dhabi and already delivers services to Ras Al Khaimah.  Both cities have recently lost the services of Emirates Airline, Air Arabia and Etihad Airways.  The likely hope is that these transport investments will attract more business out of local under-served areas.

Andrew Reid, Staff Writer, Gulf Jobs Market News
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