Port of Salalah, the nation’s premier transshipment and logistics hub overseeing the Indian Ocean, says its investment in the upgrade of its Container Terminal is key to attracting a new generation of Ultra Large Container Vessels (ULCVs) to the maritime gateway.
Work on the Container Terminal Upgrade project is set to commence during the first half of this year and will run until Q1 2025, according to Keld Mosgaard Christensen, CEO – Salalah Port Services.
Last year, the publicly listed owner and operator of the port said it is investing around $66 million in suitably upgrading the Container Terminal to support the installation of a fleet of 10 special cranes to enable the handling of these mega containerships. The cranes will be leased from APM Terminals, one of the world’s largest port operating companies, which also owns a 30 per cent stake in Salalah Port Services (SPS).
A separate agreement reached with global shipping and logistics giant Maersk commits the latter to channeling large volumes of containers to Salalah Port by routing its mega containerships via the Omani hub. A mega containership is typically 366 metres long and capable of carrying over 14,500 containers.
“The Maersk volume commitment will support the financial cost of the Lease Fee,” said Keld Christensen, CEO – Salalah Port Services. “The transactions are of paramount importance to the port and will allow us to service ULCVs within the current term of the container terminal concession which will be enabling to the company's competitiveness in the region and prevent the migration of Maersk ULCVs volumes away from the port,” Christensen stated in the Management Discussion & Analysis Report published here on Monday.
Meanwhile, container volumes handled during fiscal 2022 remained flat at 4.504 million TEUs versus 4.512 million TEUs in 2021. But the General Cargo Terminal witnessed a 9 per cent uptick in throughput to 18.395 million tonnes, up from 16.895 million tonnes in 2021. The increase was driven by higher demand in export markets for gypsum and limestone, the company said.
Commenting on the performance of the dry bulk segment, the CEO stated: “The main volume drivers were dry bulk commodities gypsum and limestone. The Russia-Ukraine political situation impacted our grain business, however, there was growth in liquid bulk with incremental volumes from Ammonia, Salalah LPG and FECO (the bunker service provider).”
Limestone and gypsum exports are expected to show “solid growth in 2023” due to the softening of freight rates in the global container trade, which has eased the pressure on the availability of dry bulk geared vessels and corresponding impact on freight rates, Christensen noted.
Port of Salalah generated a consolidated revenue from operations of RO 70.909 million in 2022, representing an increase of 6 per cent over the previous year. Consolidated EBITDA was recorded at RO 14.012 million, which corresponds to an EBITDA margin of 19.68 per cent. This compares with RO 15.538 million (representing an EBITDA margin of 23.26 per cent) during the previous year. Consolidated Net Profit declined to RO 3.220 million in 2022, down from RO4.638 million a year earlier.
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