How do you plan to increase the number of operators and investors in SOHAR Port and Freezone?
MARK GEILENKIRCHEN We attract new investment by increasing the availability of space, especially space that will be useful to certain industrial clusters. Our greatest milestone in 2019 was the work accomplished at SOHAR Port South, which has added 14% capacity to the port. In addition, the USD5.6-billion Liwa Plastics project was launched five years ago, and we expect to see an enormous jump in volumes from this project in 2020. Our projects have an extremely long-term view when it comes to success. In the short term, we seek to expand our existing space to accommodate greater petrochemical opportunities as well as food storage and processing, together with offering greater general cargo capability. The best way to attract business to SOHAR is by offering the ability for raw materials to be easily brought into a state-of-the art commercial port together with both on-site storage and processing opportunities, either in the port or the free zone. Investors are increasingly attracted by the interdependency of the site, with many units now working together to utilize the waste or leftovers from one industry to serve as feedstock for another.
How would you assess Oman's logistic sector development, and what else is required to grow the competitiveness of the local industry?
OMAR AL MAHRIZI Oman's logistics industry, compared to other countries, is progressing rapidly. The establishment of Asyad has brought about major impetus in the logistics and transportation sector with all ports and free zones now sitting under one umbrella organization in order to position Oman as a global logistics hub. The recent PPP law, in particular, also opens up opportunities for inward investment into the sector from all interested parties. In support of this, Oman can continue to rely on its strength in international diplomatic relations and other intergovernmental initiatives. Globally speaking, we are a small nation, and our internal market share will always be limited; however, other socioeconomic factors and our strategic location outside the Strait of Hormuz could play a major role in attracting future inward investment.
How are you planning on improving energy efficiencies in the free zone?
MG We are currently looking at a range of alternative energy solutions. For example, we plan to introduce solar panels to generate electricity on site to keep energy costs down during peak times in June, July, and August between 12pm-5pm. Electricity costs will increase by 60% at this time of day but, at the same time, solar PV cells will be performing at their best. We are also looking to reduce the amount of gas lost by capturing the gas generated on site and converting it to energy. Gas is a scarce resource, after all, so we need to be looking at all ways to use it more efficiently.
With declining productivity in ports worldwide, where does automation and digitalization play the biggest role in your business model?
OAM With containers, automation is a means to increase productivity. SOHAR and Oman are still not as digitally developed as other countries but we have the opportunity to make major steps forward as we are not limited by the burden of outdated infrastructure. Volume owners will drive digitalization, together with 3PL and 4PL providers. Less with the shipping companies as they mainly invest in technology to assist in scheduling, stacking, and minimizing moves. We are currently considering investing in remote-controlled cranes, depending on the nature of the goods that come to our ports, as this will lead to stronger advancements in time efficiency. Moreover, we are in the process of implementing a “community" system that would give the right information based on where the shipments are coming from, the best routes, and the right agencies and vessel lines. This can be extended further with Navigate, our online route planner, to see the real-time prices of goods.