Muscat: In a significant development, under the auspices of Qais bin Mohammed Al Yousef, the Minister of Commerce, Industry and Investment Promotion, Vale, a distinguished global leader in the production of iron ore, and Jinnan Iron & Steel Group, a reputable Chinese manufacturer specializing in advanced separation technologies, have announced a collaborative venture aimed at establishing Oman's inaugural iron ore concentration plant at the Sohar Port and Freezone.
This ambitious project, with an initial investment surpassing $600 million, is set to be a state-of-the-art facility designed to bolster Oman's iron and steel sector, elevating the nation to a prominent position within the international supply chain for Direct Reduction (DR) grade iron ore.
The Concentration Plant, slated for inauguration in the second half of 2027, is poised to process 18 million tons of iron ore annually, yielding 12.6 million tonnes of premium concentrate. Vale will allocate $227 million towards connecting the plant to its agglomerate facilities in the region, while Jinnan will invest approximately $400 million in the construction, ownership, and operation of the plant.
At the core of this partnership lies a dedication to innovation; iron ore from Brazil will undergo an upgrade to produce a higher-grade concentrate, thereby facilitating the production of high-quality agglomerates with a reduced environmental footprint. The strategic location of the new plant is expected to reinforce Oman's status as a pivotal supplier to both regional and international steel markets.
Gustavo Pimenta, the President of Vale, underscored the importance of this investment, stating, "The Concentration Plant is a significant investment for Vale as we expand our presence in the Middle East. The Sultanate’s strategic location, along with its stable political and economic environment and commitment to industrial development, positions it as an ideal partner for our expansion. This facility will not only enhance Vale's capacity to meet the escalating global demand for high-grade iron ore but also align with our sustainability objectives. We are confident that this partnership not only fortifies our operations in the region but also generates long-term value for the country and the global steel industry."
The collaboration between Vale and Jinnan marks a pivotal moment for both entities and the Sultanate of Oman. As Jinnan's inaugural project in the country, this partnership highlights Oman's allure as a destination for high-value industrial investments. Jinnan, with its advanced magnetic separation technology, brings a wealth of experience that will be seamlessly integrated with Vale's expertise, culminating in the creation of a world-class production process in Sohar.
Zhang Tianfu, the Chief Executive Officer of Jinnan Iron & Steel Group, expressed, "This collaboration presents a distinctive opportunity to merge Jinnan's extensive expertise in contemporary, low-carbon steel production with Vale's established proficiency in iron ore extraction. Through this partnership in SOHAR, our objective is to revolutionize steel production in the Middle East, prioritizing efficiency and quality. We are honored to contribute to Oman's industrial aspirations and eagerly anticipate the enduring impact of this endeavor."
Emile Hoogsteden, the CEO of SOHAR Port, remarked, "SOHAR serves as a gateway for businesses to engage with the global market. This investment represents a pivotal moment in our strategic vision to attract high-value projects and cultivate a conducive environment for business. Through our comprehensive industrial and logistics network, we are propelling sustainable development and cementing Oman's position as a significant participant in the international steel market, thereby enhancing trade efficiency and stimulating economic growth."
The Concentration Plant is anticipated to generate economic advantages that extend beyond the steel sector. By creating both direct and indirect employment opportunities, fostering technological innovation, and augmenting export capacity, the plant will enhance Oman's export potential and deepen its integration into the global steel trade network, thereby supporting initiatives to diversify the industrial landscape. With a focus on sustainability, the facility will employ cutting-edge technologies to reduce its environmental impact, ensuring the efficient utilization of resources, in alignment with Oman's pledge to pursue responsible and sustainable industrial expansion.
