Bids due by mid-July for Oman Cement’s $212m Duqm project

Bids are due in by mid-July for two key tenders linked to the establishment of a new integrated cement plant in the Special Economic Zone (SEZ) at Duqm in Oman’s Wusta Governorate. The client is Al Sahawa Cement Company (ASCC), a subsidiary of Oman Cement Company, the Sultanate’s first cement manufacturer.

Total investment in the cement mill, which is among an array of cement projects envisaged for development in Duqm over the next several years, is estimated at $212 million. At its heart is a 5,000 tons per day (tpd) clinker production unit, a contract for which is proposed to be awarded on an Engineering – Procurement – Construction (EPC) basis.

In a filing to the Capital Market Authority (CMA) earlier this year, publicly traded Oman Cement had announced that the Duqm project will be implemented in “backward integration mode” with ASCC producing cement with clinker initially sourced from the Muscat-based parent company.  In this phase, cement will be available in the local market as early as during September 2021, it said.

Work on the clinker production unit is expected to be pursued in parallel with the construction of a cement grinding unit, with commissioning slated during March 2022, it noted.

Importantly, Oman Cement has also invited bids for the supply and installation of a Captive Thermal Power Plant featuring a pair of turbines each of 15 megawatts (MW) capacity.  The thermal power plant, which is expected to utilise waste gases from the cement mill to generate electricity, will dramatically reduce the new project’s energy costs, as well as mitigate its carbon footprint.

Significantly, the new Duqm project will mark the parent group’s first expansion beyond its flagship plant at Misfah in Muscat Governorate. Majority-owned by the Omani government (represented by sovereign wealth fund Oman Investment Fund with a 53.67 per cent stake), Oman Cement was established in 1978 with a clinker capacity of around 600,000 tons per annum.  Following a series of expansions and upgrades, its capacity has since grown to 3.6 million tons per annum.

MSM-listed Raysut Cement Company, the largest cement manufacturer in the Sultanate, has also announced an initial investment of $30 million towards the construction of a new cement grinding unit at Duqm.  The facility is coming up on a plot of land administered by the Port of Duqm Company.