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Salalah Port to receive $67million in Cyclone Mekunu damage claims


Port of Salalah says it has reached a settlement with its insurer for a sum of $67.75 million as damages arising out the destruction and disruption caused by Cyclone Mekunu when it struck the southern part of the Sultanate during May 2018.

Shaikh Braik Musallam al Amri, Deputy Chairman of Board of Directors, Salalah Port Services SAOG, stated in the Directors Report for 2019 that roughly half the amount of the settlement was received by the company in 2018, with the balance amount due to be settled this year.

Cyclone Mekunu had unleashed a torrent of floodwater that had deluged the transhipment and logistics hub on the night of May 24, 2018 when the storm made landfall on Oman’s Dhofar coast. The flood caused significant damage to infrastructure and machinery, while also depositing massive quantities of silt and debris across the port area. Some dhows that had sheltered in the harbour against the storm had capsized and had to be salvaged.

According to Shaikh Braik al Amri, recovery efforts continued for well over year thereafter. The Container Terminal was restored to its pre-cyclone capacity only by June-end 2019, while the General Cargo Terminal was returned to normality during the first quarter of 2019.

“During 2018, on-account payment of RO 14.808 million was received towards the Company’s Mekunu insurance claim. No insurance receipts have been received during the year 2019. Settlement has been reached with insurance company at RO 26.06 million ($67.75 million) out of which RO 14.808 million ($38.50 million) has been already received and recognised in the income, the balance amount of RO 11.25 million ($29.25 million) to be received and recognised as income in 2020,” the Deputy Chairman noted.

Meanwhile, Port of Salalah reported its best-ever performance at the Container Terminal, which handled a record 4.109 million TEUs in 2019. This represents a 21 per cent increase over the 3.385 million TEUs handled in 2018, a year impacted by Cyclone Mekunu.

“The company has retained all major customers and Maersk’s share of business has increased by 18 per cent compared to 2018,” said Shaikh Braik.

Volumes handled at the General Cargo Terminal totalled around 16.278 million tons during 2019, which was broadly on par with the previous year’s trend.

Consolidated revenues for the year climbed 14 per cent to RO 64.724 million, while consolidated EBITDA was RO 18.141 million at a margin of 28 per cent. Consolidated Net Profit for 2019 was RO 5.673 million versus RO 5.247 million in 2018.

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