2013-09-22 09:01:34 - New Construction market report from Business Monitor International: "Oman Infrastructure Report Q4 2013"
Having registered very volatile growth that has periodically reached impressive highs since 2001, Oman's construction industry has now started to slow. Oman's Central Bank reported construction industry real growth of 1.6% and 1.9% in 2011 and 2012 respectively, which has prompted us to revise down our forecast for 2013 to 2.2%. Despite an extensive pipeline of infrastructure projects, several of them are reaching completion which will likely sap momentum from the industry. We expect moderate growth to be maintained in the short-term on the back of the government's five-year (2011-2015), US$78bn spending plan and investment associated with a burgeoning tourism industry. Over the longer term, we forecast slow economic growth as a result of declining oil revenues, which threaten to
undermine the government's ambitious infrastructure spending plans.
Full Report Details at
- www.fastmr.com/prod/684677_oman_infrastructure_report_q4_2013.as ..
Key developments in the sector:
* Growing demand for water in Oman is seeing the usual players winning contracts for new projects. ACWA Power and Malakoff International, two of the biggest names in the GCC independent water and power space are developing desalination plants in the country. Despite downgrades to the country's water demand outlook, the regulatory framework in Oman will protect investors, as long-term water purchase agreements are signed to support projects. Consequently, we continue to see Oman's Independent Water Project segment as an attractive sector for developers. Oman Power & Water Procurement Company (OPWP) has two important projects on the pipeline - Quarayyat and Suwayq - which will expand capacity by 405,000 cubic metres per day (m3/d) by 2018. Further along the list are the Barka and Ghubra projects, which will have a notable impact on capacity from late 2013.
* The Port of Duqm in Oman is to award US$285mn of construction contracts, divided into two packages. One of the contracts will be for the support infrastructure, the gate, offices and roads, while the other will be for paving, crane rails and utilities. Work is planned to be completed in Q115.
* In April 2013 Oman International Container Terminal (OICT) started construction work on its modern terminal at the Port of Sohar in Oman. The project will increase the terminal's container handling capacity to 1.5mn twenty-foot equivalent units (TEUs) from the current 800,000TEUs. The project will entail an estimated investment of nearly OMR50mn (US$129.5mn). The second phase of the terminal's development project centring Terminal D will entail further expansion scheduled to be concluded by 2018. The completion will add further capacity of 2.5mn TEUs.
* In June 2013, Oman's Tender Board, on behalf of the Ministry of Transport and Communications, invited pre-qualification bids for the second section of the Daba-Lima-Khasab carriageway in Musandam Governorate. The project, to be carried out under a 20-year design-build-operate (DBO) scheme, will entail an estimated investment of US$1bn. The project covers a 65km segment from Al Khalidya to Daba through mountainous coastal terrain. Some of the interested major local and global firms are Yuksal Construction,Daewoo Engineering and Construction and Sambu Construction. The project is the country's first DBO venture.
* Work on the inter-GCC rail network is gaining momentum. In early February 2013, the Jordanian Ministry of Transport approved plans to build a 509km rail corridor in a bid to integrate its domestic network with Saudi Arabia and the wider GCC region. Later on that month, Oman floated the tender for their US$1.5bn, 1,061km piece of the puzzle. In addition, the Omani transport ministry had initially announced that their country's trains would run on electricity, whilst other GCC states had agreed on ones powered by diesel. However, in a statement, the Omani government abandoned this idea and is now on board to use diesel-based traction engines.
* More recently the Omani Tender Board received financial bids from 12 firms for a contract to provide preliminary design consultancy services for a 1,061km rail network project in Oman. The winning preliminary design consultant will be required to design the complete infrastructure and systems covering all sections of the project. The pre-qualification process for the design and construction phase is scheduled to start before end-2013, while a contract for the first section is expected to be awarded before end-2014. The first section for priority execution is likely to be the Al Ain-Sohar Port section.
* The Omani government is scheduled to launch a project management tender for a medical city in 2013, according to Ahmed Al Qasmi, director general for planning at the health ministry. As Qasmi added, the project is part of the country's healthcare system to serve the future demand in the growing medical sector. The US$1.48bn city will be constructed in Northern Batnah and will have residential space, shopping malls and hospitals. The government-funded project will cover an area of 5mn square metres and completion is expected for 2016.
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