A $107 million steel mill will be built in the Duqm zone in Oman

Oman continues to pursue a course of industrial diversification of its economy. The country’s Public Authority for Special Economic Zones and Free Zones (Opaz) has signed a package of investment agreements worth over 200 million Omani rials ($520 million), which includes projects in the steel, construction materials, electric vehicle batteries, and pharmaceutical sectors. This was reported by the Times of Oman.

One of the key projects is a steel project in the Duqm Special Economic Zone. Kuwait’s Alshaya Group is investing $107 million in the construction of a plant to produce specialized steel products. The capacity of the first phase will be approximately 306,000 tons per year.

The plant is expected to begin commercial operations in 2028. By 2030, production volumes are projected to reach 342,000 tons per year. The facility will utilize electric arc furnace (EAF) technology, which is characterized by lower carbon intensity compared to the traditional blast furnace process.

According to Abdul Latif Alshaya, CEO of Alshaya Group, the choice of Dukm was driven by the zone’s strategic location as a multi-sector industrial hub with access to the Port of Dukm, which opens onto the Arabian Sea and the Indian Ocean. Additional advantages include existing infrastructure, investment incentives, and logistical flexibility.

The company noted that the plant is intended to meet the region’s growing demand for steel products from the construction and infrastructure sectors, as well as reduce dependence on imports. The potential use of future green hydrogen initiatives being developed in Duqm was also cited as a promising direction.

Ahmed Ali Akaak, head of the Sezad zone, emphasized that the new plant will complement the cluster of metallurgical enterprises already taking shape in the region with the participation of international investors.

As a reminder, according to the Institute for Energy Economics and Financial Analysis (IEEFA), Oman has every opportunity to become a leader in global green steel industry thanks to its natural and geographical advantages, robust industrial infrastructure, and forward-looking strategic planning.