The joint venture of Oman Investment Corporation (OIC) and Saudi engineering contractor Mohammed Ali Al Swailem Group (MASCO) has been named the Master Developer of the Khazaen Economic City (formerly Khazaen Logistics Hub) in Barka in North Al Batinah Governorate.
An agreement to this effect was signed by Dr Ahmed bin Mohammed Al Futaisi, Minister of Transport and Communications, who is also Chairman of ASYAD Group, the holding company of the Omani government’s investments in seaports, free zones, cargo terminals, logistics parks and other transport and logistics infrastructure in the Sultanate. Khazaen, owned 100 per cent by the government, is a subsidiary of ASYAD Group.
Signing on behalf of the JV partners were Kalat Ghulam al Bulooshi, CEO — Oman Investment Corporation, while MASCO of Saudi Arabia was represented by Mohammed Ali al Swailem, Chairman of the Board of Directors. The signing took place against the backdrop of the Oman Real Estate Conference 2018 (OREX), which opened at the Oman Convention & Exhibition Centre yesterday. A number of ministers, under-secretaries and other dignitaries attended the opening.
Later, in remarks to journalists, Al Bulooshi said the JV would serve as the ‘Master Developer’ of Khazaen — an integrated city spread over an area of 51 million sq metres and featuring a dry port, as well as industrial, commercial and residential zones.
Investment in Khazaen’s infrastructure development during the first phase is in excess of RO 300 million over the next 20 years, said Al Bulooshi. This is anticipated to rise to around RO 700 million over the 49-year-long tenure of the agreement with ASYAD Group, he stated.
“We hope to break ground at site within 6-9 months — that is our target,” OIC’s Chief Executive Officer said. “But before we have the groundbreaking, we will have to commence work on the detailed design. The (initial) design has been done by KEO International, while the master-plan has been prepared by an Australian firm. Right now, we are floating a tender for international consultants to (undertake the detailed design).”
Funding for the infrastructure development, he said, will be raised by OIC. “We are an investment company and we will be using our own funds. Initially, we will raise the money ourselves, but in about 2-3 years’ time, we might consider a public offering.”
A key feature of the Economic City is a first-of-its-kind dry port, for which an operator will be named shortly, said Al Bulooshi. The JV, he explained, is currently in discussion with logistics services providers for the selection of a suitable operator, potentially as a partnership of established service providers.
As an ‘inland port’, the facility will enjoy pre-clearance privileges, which allows for cargo to be cleared at Khazaen for direct delivery on board ships in Sohar Port. “There will be a direct connection, with container and even bulk, shipped to Khazaen and vice versa. Empty containers will be filled up and despatched directly to the port,” he said.
Al Bulooshi also noted the important role that MASCO would play in securing Khazaen’s long-term development. “ Saudi Arabia is an important market for Oman, And we are happy to have them as our partner. As the largest market in the GCC, Saudi Arabia offers a lot of business opportunities for Oman. Once the road connecting Oman with Riyadh opens, Khazaen will provide an important link to the Saudi market.”
Upgraded from a logistics hub into a full-fledged Economic City, Khazaen will cater a wide range of business investments encompassing the following: Industries and Free Zones (manufacturing, packaging, assembly, repairs and maintenance activities); Logistics & Warehousing (retail warehousing, food stores, building materials, distribution, bulk handling and freight forwarding); Residential Zones (affordable housing projects, townhouses, staff lodgings, and so on); Businesses (commercial offices, banks, finance firms, IT and law offices); Social Infrastructure (schools, universities, hospitals, clinics, hotels and recreation facilities); and Retail and Entertainment (hypermarkets and supermarkets, auto dealerships, showrooms, and retail outlets).
Conrad Prabhu & Jomar Mendoza
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