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Port Salalah (ex Port Raysut)

Port Salalah (known formerly as Port Raysut) is located in southern Oman some 1000 km down the coast from Muscat, and just 150 km from major East-West shipping lanes. Port Salalah has established itself as a leading container transshipment center on the Indian Ocean Rim since its opening in November 1998. The Omani Navy is well armed, very efficient and has a base in Mina Salalah. They actively patrol the coast. There have been no reports of any criminal activity on the Omani coast.

Port Salalah is the only port between Europe and Singapore that can accommodate the S-class, or world's largest class of container vessel. The Port is already ranks among the top twenty container ports in the world. In its first year, shipping traffic levels at Port Salalah reached a maximum of 65 vessels per month and is expected to grow steadily. In its first year of operation, it averaged approximately 45 vessels per month, and 54,000 TEU containers per month, with an annual container handling output of one million TEU's per year.

This US $250 million container transshipment port was established as a joint venture between the Omani government, private investors, and shipping companies Sea-Land and Maersk. Salalah Port was originally established jointly by Omani private investors (40%), the Omani government (30%), U.S. Sea-Land (15%), and Maersk (15%). Prior to its acquisition by Maersk in 1999, Sea-Land Services served as manager for the Salalah Port Services Company and, with strategic partner Maersk, is a principal customer of the port. In 1999, Maersk bought Sea-Land's 15 percent stake in Salalah Port as part of an international acquisition from Sea-Land's U.S. parent company, CSX.

Since its opening, Port Salalah has witnessed steady growth in shipping traffic and has the potential to generate rapid industrial development in southern Oman. The Port Salalah project surpassed an Omanization target of 60% prior to its official opening in November 1998.

Government plans to establish a free zone at Salalah adjacent to the port have the potential to make Salalah a major air-sea cargo hub and center for industrial development, capable of handling next generation container ships of 10,000-12,000 TEU containers. In June 1999, the Omani government announced plans to launch an industrial free zone at Port Salalah, under the management of Salalah Port Services, the Omani- U.S. joint venture which runs the container port. It is expected that a Memorandum of Understanding between the Sultanate of Oman and the port operator, Salalah Port Services Company SAOG, will be signed in the near future to establish a free trade industrial zone at Salalah Port. This free trade zone is expected to attract storage and warehousing facilities as well as value-added light industries. With Salalah's prime location and container transshipment facilities, the free zone has the potential to attract leading multi-national manufacturing and processing operations, as well as become a major air-sea cargo hub.

In 1999, the government selected Credit Suisse/First Boston as financial advisor for the planned privatization of Muscat's Seeb International Airport and Salalah Airport, for which the government was expected to issue pre-qualification invitations to prospective bidders by year-end 2000.

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