Duqm delivers: Dramatic economic growth is reshaping this port town

Some of the most dramatic economic growth outside of Oman’s capital can be found in the port town of Duqm. Located approximately 550 km to the south of Muscat in the Al Wusta region, Duqm was a small fishing community in the 1950s when a team arrived to begin oil exploration in the area. Today economic activity in the town focuses on the maritime and industrial sectors, and the population is quickly expanding. Indeed, the Ministry of National Economy recently reported Duqm’s total number of residents surged from roughly 5100 in 2008 to over 11,200 people in 2010, representing growth of nearly 120% over two years.

Driving Growth

One driver of Duqm’s economic growth is the Oman Drydock Company (ODC), which launched full operations of its ship repair yard and dry dock in mid-2012. Further economic growth is expected with the additions of the Port of Duqm, the Duqm International Airport and an oil refinery – all of which are scheduled to come on-line in the coming years.

While the development of these projects remains a key factor in the port town’s future economy, a range of smaller projects are playing an important, supportive role in Duqm’s economic rise. For example, a temporary diesel power facility – with a capacity of 67 MW – has been set up in order to meet growing electricity needs. Power will be produced at 11 KV, though this may increase to 33 KV with the help of three step-up transformers, according to the Special Economic Zone Authority at Duqm (SEZAD), the manager, regulator and developer of economic activities in Duqm.

Power capacity in the town should expand substantially with the planned addition of another power facility. SEZAD reported that the gas-fired plant will operate with a capacity of 500 MW to 1000 MW and be fuelled via a pipeline from the Saih Nihayda gas field. Electricity in Duqm is delivered through an underground cable network, and seven substations have been built.

Water, Water, Everywhere

The town’s ability to produce and distribute desalinated water is also expanding. Construction on a reverse osmosis desalination facility, which is capable of producing of 6000 cu metres of water per day, has been finished. Work is already under way to expand the facility, according to SEZAD. Construction on two reservoirs should be completed shortly, and steps are being taken to design a third.

Duqm's industrial facilities, port and airport will all be enhanced with improvements to the primary road connecting Duqm and the northern part of Oman. Traffic on the Sinaw-Mahout-Duqm carriageway, which runs through the Al Sharqiya South region, is expected to surge due to Duqm's economic growth. The Ministry of Transport and Communications aims to transform the single carriageway into a larger, faster motorway that bypasses populated areas. According to the government's most recent five-year economic plan, which runs from 2011 to 2015, OR80m ($208.5m) will be allocated to the project. In May 2012 Khalid bin Ahmed and Sons (KBAS), an Oman-based construction firm, won a bid to build the first section of the project, which stretches around 81 km. KBAS reported that the project was worth close to OR42m ($109.5m).

New Connections

The launch of a charter service running three times weekly between Muscat and Duqm should also facilitate the town’s nascent industrial and maritime sectors. Inaugurated in November 2012, the new service is operated by Oman Air through an agreement with SEZAD. Before the charter service began, the only method of reaching Duqm was by road, a trip that took around six hours when travelling from the capital. Oman Air recently reported that their direct Muscat-Duqm flights will take roughly one hour and 30 minutes, thus significantly reducing travel times.

In addition to its agreement with Oman Air, SEZAD set up its own tender board in early 2012. The board aims to establish tender committees, formulate procedures and policies, and accelerate the tendering of several key infrastructure projects. Two projects set to be floated through the new tender board are both related to the construction of the Port of Duqm’s liquid jetty, which will be used to service a new refinery.