Sohar Aluminum promoting industry in Oman - Mr Pauw CEO

 

 

Part of the transcript is as under

 

 

Mr Pauw explained that “Sohar’s history goes back over 5,000 years. Moreover, at one time it was the capital of Oman spearheading the modern industrialisation and the trading renaissance of the region. In ancient times copper was mined and smelted in the mountains behind Sohar and exported to the great Sumerian and Persian empires of the era, while food was produced and exported throughout the Gulf region. 

 

 

He said “Today, copper mining continues in the mountains, but it is aluminium smelting and the manufacture of downstream products that is taking over as a revenue generator and acting as a trigger for a national industrial development.”

 

 

He added “Being a heavy consumer of electricity, aluminium smelting is in the process of moving away from the older industrial nations of the West where energy is relatively expensive, to the Middle East where power is cheap. With a ready supply of gas that would previously have been flared off from the oil wells, many of the oil producing countries are capable of generating large amounts of power at a relatively low cost, and this is ideal for the power hungry smelting process.”

 

 

He said “Sohar therefore has it all low cost gas piped in from the vigorous oil industry and a location on the Arabian Sea that lies on the direct shipping route between the Suez Canal and the Far East providing easy access to the major global trade routes for importing materials and exporting finished products. In addition, the choice of Sohar as a location for Oman’s new industrial centre is even more pertinent in view of its distinguished cultural history, the archaeological evidence for which is widely scattered around the region.”

 

 

The flagship enterprise in the industrialization of the region, and the new port’s first major customer, is Sohar Aluminium. The company was launched in September 2004 through a powerful alliance between three well established businesses, each of them bringing a significant level of expertise and knowledge to the project. Oman Oil Company, which owns a 40% share in the company, is a commercial body wholly owned by the government of Oman and charged with pursuing investment opportunities in the energy sector, both in Oman and further afield. TAQA, 51% owned by the Abu Dhabi National Energy Company PJSC, another government body, has a further 40% share in the company, while the remaining 20% is provided by Rio Tinto Alcan, the aluminium division of the global mining and metals group, Rio Tinto.

 

 

The plant currently produces 375,000 tonnes of aluminium per annum, and employs a workforce of 1,000 people. But the aluminium smelting facility is just the starting point for a growing industrial base. Mr Pauw believes the company indirectly employs some 3,000 people, across a range of downstream industries. 

 

 

A considerable proportion of the plant’s output is cast into ingots and exported around the world through the Port of Sohar. However, part is supplied in liquid form to an adjacent factory that produces aluminium cables for high voltage power lines. These cables are then either supplied to Oman’s growing aluminium industry or exported. By manufacturing from liquid aluminium direct from the smelter, the cable factory is able to operate at a markedly reduced cost as it bypasses the metal melting process most of its competitors go through.

 

 

The downstream industry is still growing strongly. A new aluminium rolling mill is currently under construction close to the smelting facility. He added that “Our target is to pass 60% of our output on to Omani companies. We’re not there yet, and there’s still room for improvement. But when the rolling mill is up and running we will be getting close to that target.”