OCT - DEC 2011
NEW INFRASTRUCTURE PROJECTS GET THE NOD New RO6mn facility in Sohar Industrial Port Floating dock at Duqm gets approval Tenders floated for $400m Ghubrah Desalination Plant and National Railway Network Design
INFRA OMAN 2011 SPECIAL
INSIDE: Iron & Steel • Paints • Formwork • Projects • Building Materials
OCT - DEC 2011
NEW INFRASTRUCTURE PROJECTS GET THE NOD New RO6mn facility in Sohar Industrial Port Floating dock at Duqm gets approval
Tenders floated for $400m Ghubrah Desalination Plant and National Railway Network Design
INFRA OMAN 2011 SPECIAL
INSIDE: Iron & Steel • Paints • Formwork • Projects • Building Materials
Concept and content by Akshay Bhatnagar Susmita De Sushmita Sarkhel Turki Al Balushi Senior Manager - Dossier Business Unit Shivkumar Gaitonde Senior Media Executive Girija Shankar Mohanty Senior Art Director Sandesh S. Rangnekar Design M. Balagopalan Khoula Rashid Al Wahaibi Translator Mustafa Kamal Production Manager Govindraj Ramesh Photography Rajesh Burman Motasim Abdullah Othman Al Balushi CORPORATE Chief Executive Sandeep Sehgal Executive Vice President Alpana Roy Vice President Ravi Raman Senior Business Support Executive Radha Kumar Business Support Executive Zuwaina Said Al-Rashdi Published by United Press & Publishing LLC PO Box 3305, Ruwi, Postal Code - 112 Muscat, Sultanate of Oman Tel (968) 24700896 Fax (968) 24707939 Email: email@example.com All rights reserved. No part of this publication may be reproduced without the written permission of the publisher. The publisher does not accept responsibility for any loss occasioned to any person or organisation acting or refraining as a result of material in this publication. OER accepts no responsibility for all advertising contents.
oday, the construction industry in the GCC region is consumed with the demands of delivering government-sponsored infrastructure and other large-scale projects. The industry is undergoing a significant structural transformation, attributable in part to the business cycle. Considering the industry’s overall upward swing – reflected in its +35 per cent compound annual growth – during the past decade, it appears that the industry is in a position of continued growth, despite a recent short-term slowdown and decreasing activities in selected segments and cities, stated a Booz & Company report. It further stated that the growth spurt driven by megaprojects across the GCC region is forcing the industry to rapidly develop specialized expertise and to expand operations throughout the region. At the same time, the residential and commercial megaprojects that defined the industry’s growth spurt earlier in the decade have been replaced in many cases by government-sponsored infrastructure projects – mostly in Saudi Arabia, UAE, and Qatar. This change in the mix of projects has presented the first of many shifts in the industry. Yet the structural changes facing the industry are driven by factors far broader than project mix and shift in geographical concentration of projects. They emanate from five critical areas: project size and budget, customer expectations and sophistication, competition, suppliers and the supply chain, and investors and financing. In the past decade, the industry’s watchwords have changed from small, simple, and single to colossal, complex, and coordinated. Rather than the typical small to medium-sized projects of up to US$100 million, contractors are looking at multibillion-dollar projects, often involving complex civil works, electromechanical systems, and other vital infrastructure. As a result, contractors now carry portfolios of projects far larger than they did just 10 years ago. For example, in 2005, one of the largest GCC contracting companies managed a project portfolio of approximately $1-2bn; by the end of the decade, the same company’s portfolio was over $5 billion. Finally, project complexity requires contractors to be far more reliant on an array of highly specialized subcontractors, which they often need to manage under challenging deadlines and high expectations for quality. Other changes are also burdening contacting companies. As customers’ stakes have grown and capital has become more scarce, customers are taking a more active interest in their projects and contractors’ activities creating a rise in customer expectations. Meanwhile, shifts in the competitive landscape have blurred the boundaries between large companies and mega companies, and have driven many small and medium-sized companies to re-evaluate their position in the market to continue to grow. The supply chain has also evolved. As customers exert greater control over project management, they are pushing contractors to assume greater levels of risk – for example, moving from costplus to fixed-price contracts and thus making contractors absorb increases in the costs of raw materials. This change is further exacerbated by growing volatility in the environment for raw materials.
Copyright © 2011 United Press & Publishing LLC Printed by Ruwi Modern Printing Press
October-December 2011 DOSSIER
GCC Cement Sector on Recovery Path
A comprehensive report on the status of the GCC cement sector Editoriall. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ..1 1 Oman News . . . . . . . . . . . . . . . . . . . . . . . . . . . . .4 Regional News . . . . . . . . . . . . . . . . . . . . . . . . . .10 INTERVIEW: D. K. Saraogi, Jindal Shadeed Iron & Steel . .24 Jacob Kuruvilla, Hempel Group . . . . . . . . . . .38
Realty business models
Anchoring the way
Dr Rashid Al Leem, HFZ . . . . . . . . . . . . . . . . .50
Sudhakar Reddy discusses the different strategies adopted by players in real estate sector
Nico Vincart, Jan De Nul Dredging speaks about their role in building and upgrading Duqm port complex
COMPANY PROFILE: Doka Muscat. . . . . . . . . . . . . . . . . . . . . . . . . . . .32
ARCHITECTURE: Tabanlıoglu Architects . . . . . . . . . . . . . . . . . . .64 SPONSORED FEATURES: PERI (LLC) Formwork Shoring Engg . . . . . . .40 Yousuf Bin Ahmed Al – Aamri Trading . . . .42 Muscat Heaters Industry . . . . . . . . . . . . . . . . .44 Oman Insurance Company . . . . . . . . . . . . . . .46
Traffic Safety Royal Oman Police and Oman International Trade & Exhibitions announce Traffic Safety Expo 2011, October
DOSSIER October-December 2011
INDEX hosts Contemporary Majlis Competition INDEX provides a unique business and networking opportunity for all
International Heavy Equipment Co . . . . . . . .47 National Plastics Factory . . . . . . . . . . . . . . . . .48 Target . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .49
Pact signed for setting-up of ‘Port City’ at Port of Sohar
Sohar Industrial Port Company (SIPC) has inked an agreement with a local investor for the establishment of ‘Port City’ – a mixed use office and retail development designed to cater to the needs of the port user community. The facility, which will come up on a six-hectare plot at the entrance to the port, is being set up by Port City Development Co LLC, a local community contractor, with a total investment of around RO 6 million. Shaikh Saad bin Mohammed al Mardhouf al Saadi, Minister of Commerce and Industry, and Chairman of SIPC, presided over the agreement signing ceremony. Signing on behalf of SIPC was Jamal T Aziz, CEO of Freezone Sohar, while the developer was represented by its CEO, Issa bin Mohammed al Barmani. Port City has been conceived as a new office and retail concept for Sohar. It will accommodate public services, private companies, retail outlets, and other support services. Strategically located in front of the port secured area, the complex will provide members of the user community, 4
DOSSIER October-December 2011
notably shipping agencies, freight forwarders, and other port and maritime service providers with a suitable and fully equipped base from which to conduct their business within Gateway Sohar. Commenting on the significance of the project, Jamal Aziz said: “Any port attracts many different users and third parties, such as shipping agents, freight forwarders as well as government agencies that handle customs, health, quarantine services, and so on. We believe a complex like this is a key requirement within the port area to serve these various users. It will be a hugely successful venture because it provides a comprehensive range of services and amenities, including shopping, fuel, and other services. This combination of services is a good factor in attracting parties, who are currently scattered or not present in Sohar, to take up space in this complex. We’d like to encourage specifically shipping and cargo handling agents, among others, to have their offices at Port City.” Construction work on the project is
expected to commence by December 1, 2011, with Phase 1 due to be commissioned by 2012-end. Phases 2 and 3 will be brought into operation by the end of 2014. Envisaged in Phase 1 is a one-stop Service Building, housing the front offices of relevant government departments and shipping agencies, allowing efficient document handling for the continuously increasing marine activities in Port of Sohar. Also in Phase 1, Oman Oil Marketing Company (omanoil) will establish a Superstation – a new concept filling station with a range of facilities for both trucks and drivers. It will feature a service station for trucks, coffee shop and shower facilities for drivers. In subsequent phases, the project will offer space for businesses, such as banks, local retail and even a supermarket. With its high level of ambience and amenities, Port City will emerge as a landmark within the Port of Sohar, said Jamal Aziz, adding that the project is also expected to create a large number of jobs for local Omanis.
Tender floated for $400m Ghubrah Construction to begin at desalination plant Sohar Sulphur Bentonite Fertilizer Project The Tender Board has invited bids from interested companies to ‘prequalify for the competitive bid process’ for an Independent Water Project (IWP) planned at Ghubrah. Oman Power and Water Procurement Company (OPWP) is supervising the procurement of the Ghubrah IWP on behalf of the Public Authority for Electricity and Water (PAEW). The major project is expected to attract interests from major international and regional utilities for obtaining the license to develop, owned, finance and operate the Ghubrah IWP. The plan t is expected to have a capacity of 42 million
imperial gallons per day (MIGD), equivalent to 191,000 cubic metres per day. It would be the second IWP to be developed in the Sultanate after the successful launch of the country’s first IWP at Sur in 2007. The new Ghubrah IWP, estimated to cost $350-400 million, will come up at the site of the existing Al Ghubrah Power Generation and Water Desalination Plant in Muscat Governorate. The latter facility, built in phases over many years, is itself planned to be decommissioned in line with OPWP’s seven-year planning process, as well as for environmental considerations.
National Railway Network project gets a boost The ambitious national rail network plan got a fillip recently. The Tender Board has floated a tender for the key design package for the project. According to reports, 10 major engineering firms have prequalified to participate in the design and construction supervision package. Earlier, over 30 companies were in the fray. The Supreme Committee
DOSSIER October-December 2011
for Town Planning is overseeing the current design consultancy phase of the multi-billion dollar scheme. Reported earlier, the national railway network is expected to comprise five segments: Muscat – Sohar (242 km), Muscat – Duqm (486 km), Sohar – Al Ain (166 km), Sohar – Khatmat Malaha (58km), and Duqm – Salalah (646 km). Later on, the network would also extend to Adam, Nizwa, Ibri, and other locations that will be identified based on a National Spatial Strategy Study currently being undertaken by the Supreme Committee. The selected Design & Supervision Consultant will establish the system parameters, and operating plan and design standards, as well as prepare the preliminary design for all the elements of the railway project.
The 30,000 tonnes-per-annumcapacity sulphur bentonite fertilizer project at Sohar is expected to further lift the reputation of Sohar as the industrial hub of the Sultanate. The construction on the project is expected to start shortly. The project is being jointly developed by Takamul Investment Company SAOC, the majority owned downstream investment arm of Oman Oil Company, in association with local and international investors. A tender for the EngineeringProcurement-Construction (EPC) contract is also expected to be finalized soon. Simon Engineering, an engineering consultancy firm, has been appointed by Takamul to provide architectural, structural and MEP consultancy services for the project. The plant will process molten sulphur – sourced from the Sohar Refinery complex of Oman Oil Refineries and Petrochemical Industries (Orpic) – into sulphur bentonite, demand for which is growing globally as an economical and environmentally-friendly alternative to natural gas based fertilizers. Sohar Sulphur Fertilizers’ entire requirement of sulphur as feedstock will be met by Sohar Refinery. Molten sulphur is a by-product of the crude oil refinery process at Sohar Refinery.
Oman Drydock’s floating dock project gets green light Oman Drydock Company (ODC) has finalised plans for the addition of a floating dock to its world-class ship repair yard at Duqm on the Wusta coast. According to a top official of the state-owned company, the Panamaxsize floating dock will be fabricated by ODC itself at its sprawling complex within the Port of Duqm. Shaikh Khalil bin Ahmed al Salmi, Deputy CEO of ODC, said the company’s Board had approved a study recommending the inclusion of a floating dock to the ship repair yard’s facilities. Importantly, the floating dock project is a key part of ODC’s vision to establish a fully integrated facility capable of offering a wide spectrum of vessel maintenance and repair services in the Sultanate. A feasibility study undertaken on behalf of ODC by leading professional services firm PriceWaterhouseCoopers found significant market potential for a floating dock at Duqm. The floating dock will complement ODC’s massive dry docks in targeting a wide array of vessel types and sizes requiring maintenance, repair and related services. ODC currently boasts a pair of giant graving docks capable of accommodating massive ships, including Very Large Crude Carriers (VLCCs), Ultra Large Crude Carriers (ULCCs), fourth and fifth generation container ships, and other vessels of a maximum capacity of 600,000 DWT. The floating dock, on the other hand, will primarily cater to smaller domestic tonnage, such as fishing trawlers, government vessels, passenger and cargo ferries, and small to mid-sized naval ships. When operational, it is expected to surpass in capacity the Gulf region’s only other floating dock currently in operation in Bahrain. Plans for the addition of a floating dock to ODC’s impressive capabilities come as the 8
DOSSIER October-December 2011
ship repair yard gears for commercial launch. According to Al Salmi, commercial operations are targeted before the end of this year, signalling a new phase in the yard’s operational capabilities.
available on the country’s doorstep. Al Halaniyat, a barge owned by National Ferries Company, and Raysut-1, a cement carrier operated by Raysut Cement, have also been maintained at ODC.
Since its ‘soft’ launch in April, ODC has been moving prudently towards a gradual ramp-up of operations in light of its importance as a national project that embodies the Sultanate’s maritime aspirations. Starting with the handling of relatively small vessels, ODC has since been taking on bigger ships in a carefully thought-out build-up of its capabilities.
The international market’s positive response since ODC’s soft launch augurs well for the ship repair yard’s long-term operational success, said Al Salmi, adding that an effective marketing campaign launched by the company is also set to pay dividends.
The biggest of the vessels handled so far at ODC was a container ship owned by the German shipping line Hermann Buss. The 1,608 TEU capacity vessel was due to leave Duqm recently, following the completion of maintenance work. To date, ODC has handled a total of 12 ships of varying sizes, said Al Salmi. Among the first arrivals was a pair of vessels owned by GDN of Belgium. Oman-owned or chartered craft have also been taking advantage of maintenance and repair facilities
ODC has been showcasing its worldscale ship repair yard at leading international maritime exhibitions. In May, the company participated in Nor-Shipping, a prestigious annual maritime event held in Norway that attracts the biggest names from the global shipping industry. The Deputy CEO also underlined the role played by Daewoo Shipbuilding and Marine Engineering (DSME), one of the world’s biggest shipbuilders, in the development of the yard. DSME is ODC’s strategic partner in the operation and management of the Duqm complex.
Two new Galfar Group affiliates incorporated Galfar Engineering & Contracting has announced the incorporation and registration of two new affiliated companies in the Sultanate of Oman. The first is Unibeton-Galfar Ready Mix LLC, which is a limited liability company associated with Unibeton Ready Mix LLC (United Arab Emirates). Galfar and the UAE firm have a 50-50 participation in the share capital. UnibetonGalfar Ready Mix specialises in
the business of producing and supplying ready mix concrete. The other company, Aspire Projects and Services LLC, is a limited liability company and a subsidiary owned 99.9 per cent by Galfar Engineering & Contracting SAOG. This company will undertake small diversified engineering and contracting works, Dr Hans Erlings, CEO of Galfar Engineering stated in a disclosure notification to the Capital Market Authority.
Powering the growth
FIRE ENGINEERING DIVISION
DOORS AND SHUTTER FABRICATION DIVISION
COMMERCIAL INTERIOR DIVISION FIRE ENGINEERING DIVISION
DOORS AND SHUTTER FABRICATION DIVISION
BUILDING ENGINEERED SOLUTIONS
YOUSUF BIN AHMED AL-AAMRI TRAD (LLC)
P.O. Box: 1068, Al Hamriya 131, T: +968-24701020 (5 Lines), +968-96788233, +968-99347695 F: +968-24703313 Email: firstname.lastname@example.org, Web: www.yaatgroup.com
Jeddah Islamic Port to award SR649m contracts Saher Tahlawi, Director General of Jeddah Islamic Port (JIP), has announced that the authority will award contracts for a parking area at a cost of SR500 million, a power station costing SR109 million and construction of government buildings at the port costing SR40 million. Tahlawi added that the projects will be completed by the middle of 2013, as part of Saudi Arabia’s plan to increase capacity at its nine seaports by 2020. The authority will award contracts in September once it receives the funds from the finance ministry, he added.
Pringle Brandon taps Gulf $8.6bn interiors market UK-headquartered interior architecture firm Pringle Brandon is putting its distinctive design stamp on the expanding Gulf market with fit-out contracts valued at over $9.6 million secured through its Dubai office. Pringle Brandon has over 25 years’ experience creating tailored and sustainable workplace and hospitality environments, from small boutique offices to headquarter buildings exceeding one million square feet. The company initially entered the UAE market in late 2010 in response to increasing demand from high profile multinational and regional clients. Commenting on the firm’s decision to launch a dedicated design resource for the MENA region, managing director, Steven Charlton, said, “International expansion into the region has been on our radar for several years, and with the world’s leading financial institutions heading to Dubai, as well as a rebounding hospitality sector primed for aggressive development, the time was right.”
10 DOSSIER October-December 2011
A recent report published by industry specialist UBM Built Environment, estimated that the GCC interior design and fit-out market would witness $8.6 billion worth of contracts in 2011, a 40 per cent increase over the $5.1 billion awarded in 2010. Furthermore, a study by UAE-based business advisory, Ventures Middle East, claimed that spending on interior design and fit-out in the commercial sector alone in the UAE would reach $821 million in 2011, up from $709 million last year, while the UAE hospitality sector also shows impressive growth, awarding $1.3 billion worth of contracts in 2011, compared with $406 million in 2010. By the end of the first quarter of this year, the total project fit-out value reached over $5.5 million, covering more than 250,000 square feet, and included the 300-key Radisson Blu hotel in Sharjah, Pfizer headquarter buildings for Jeddah and Riyadh, Hill International’s and Norton
Roses’ offices in Abu Dhabi, and a number of Dubai projects including Royal Bank of Scotland and Goldman Sachs. A healthy forecast for the rest of 2011 moving into 2012 is envisaged with fit-out contracts valued in the region of $4.1 million across 109,000 square feet. Pringle Brandon’s burgeoning client list includes Microsoft office projects in Abu Dhabi, Boeing Abu Dhabi, as well as research agency TNS in Dubai and headquarters for Halliburton Dubai. “We’re also seeing growing interest from the wider African continent, with the 100-key Starwood hotel development in Nigeria’s commercial and financial capital, Lagos, giving us a foothold in the region,” remarked Charlton. Pringle Brandon is also supported by its own research division, which publishes regular reports covering a range of industry topics from market trends and effective space utilisation to environmental issues.
Kuwait to construct $6.2bn highways in 3 years As part of its plans to become a commercial and financial hub in the region, Kuwait will construct highways worth $6.2 billion over the next three and a half years. Kuwaiti Minister of Public Works Fadhel Safar has said that the ministry is currently designing highways that will be tendered in the coming three and a half years, one after the other, for a cost of KD1.7 billion and a total length of 550 kilometres.
Power & water infrastructure investment to increase The task facing GCC utilities has just got harder. The recent situation in Bahrain and the wider Middle East has led several GCC governments to announce major investment programmes in housing and social infrastructure. Such measures will only serve to increase the already high demands on the regional power and water sectors. Saudi Arabia faces the biggest challenge. It had forecast that demand would reach 75,000MW by 2019, up from 46,000MW in 2010. However, the forecast does not take into account the February 2011 announcement by King Abdullah that some 500,000 new housing units would be built. This alone will add a further 5,000-6,000MW to the demand forecast. Similarly, Abu Dhabi has revised its 2020 power demand forecasts by about 6,000MW to 28,000MW in light of the March 2011 announcement by UAE President Sheikh Khalifa Bin Zayed al-Nahyan for increased investment in the Northern Emirates’ power and desalination sector. 12 DOSSIER October-December 2011
“Even before the announcements, demand for new power capacity was rising, 2010 peak power demand remained high across the GCC with both Qatar and Abu Dhabi each having to contend with a rate of 11 per cent followed by Saudi Arabia at 10 per cent,” says Angus Hindley, Research Director at MEED and author of MEED Insight’s GCC Power & Desalination report series. “In the GCC alone, some $65 billion will be required in increasing generating capacity and at least the same amount in expanding the transmission and distribution network.”
for 11,000MW. Perhaps the biggest challenge facing utilties in the coming years will be how to secure the necessary feedstock to power the new capacity. With the exception of Qatar, all GCC states are facing increasingly tight gas markets leaving governments with little option but to pursue alternative energy production. In Saudi Arabia and Kuwait, liquid fuels, in the form of crude oil and diesel, have overtaken gas as the largest source of feedstock. However, this has come at a high price with Riyadh alone burning an estimated 800,000 b/d in its power plants.
With some 11,000MW of new capacity commissioned in 2010 utilities largely managed to accommodate the growth in peak demand although in Bahrain and Sharjah network and fuel issues led to some outages. At the same time, the amount of new capacity contracted from the market in 2010 reached its highest level for four years at an estimated 14,000MW. This was largely due to an unprecedented capacity programme launched by Saudi Arabia, which delivered contracts
The increasingly high cost of burning liquid fuels and the environmental concerns over coal have left nuclear power as the favoured option in most of the GCC. Although the Fukushima nuclear disaster in Japan is likely to delay some regional plans, there is a growing acknowledgement in the GCC that nuclear power will have to play a significant role in future if the high power demand growth is to be met and electricity shortages are to be averted.
VARIO GT 24 Girder Wall Formwork Variable for all designs and applications
LIWA – The lightweight Wall Panel Formwork Crane-independent forming of walls, foundations and columns.
MULTIFLEX – The flexible Girder Slab Formwork Versatile for any slab thickness, any floor plan and all heights.
SKYDECK – The proven Aluminium Panel Slab Formwork Lightweight components and the need of fewer slab props save time and costs.
Competent Engineering – The Best Solution for Every Requirement Cost-efficient formwork planning and design during the whole construction phase.
Safe – Exact – Fast German Formwork and Engineering for Every Concrete Project PERI Egypt
Phone +20 2.24 04 85 24 / 26
Phone +962 6.5 51 67 31
Phone +966 (0)2.6 12 83 00
jordan @peri.de info @peri.com.sa
Phone +965 22.32 29 21
PERI Lebanon Beirut
Phone +961 (0)1.24 33 65
Phone +968 (0)2.4 57 10 90
email@example.com perimct @perime.com
Phone +974 44 11.48 16 / 17
Phone +971 (0)4.3 26 29 92
Abu Dhabi Phone +971 (0)2.6 79 88 05
perillc @perime.com firstname.lastname@example.org
Formwork Shoring Engineering www.perime.com
Emirates Steel issues ITB for phase 3 expansion Emirates Steel, the integrated steel producer in the UAE, has released the invitation to bid (ITB) for Phase 3 of its expansion project. Launched almost five years ago, the project is in line with Abu Dhabi’s visionary “2030 Plan”, which aims at reinforcing the industrial sector in the Emirate. The plan also targets the establishment of a solid and diverse manufacturing base that will help diversify the Emirate’s resources and contribute to the nation’s income through the development of substantial industrial units, primarily in the basic industry sector. According to Emirates Steel’s Chairman, HE Engineer Suhail Mubarak Musallam Athaeeth Al Ameri, Phase 3 will comprise a steel melting plant, a hot rolled coil (HRC) mill and ancillaries, which will primarily service GCC demand for HRC across a range of downstream segments, including: pipe producers; cold rolling producers of galvanisSed coil and coated sheeting products; boiler, tank and pressure vessel producers; and structural steel fabricators. The Company has already completed, over a period of five years, a twophased expansion programme costing approximately Dhs9 billion. The programme consists of new rolling mills, steel manufacturing and direct reduction plants, together with a heavy and jumbo sections mill, due to come on stream by the end of the year. The new plants increased the Company’s rolling output capacity from 650,000 metric tonnes per annum (MTPA) to approximately 3 million MTPA at present. Bin Athaeeth said that Emirates Steel plans to award the contracts for Phase 3 by December 2011. He stressed that the project has attracted significant interest from various internationally14 DOSSIER October-December 2011
renowned bidders. The project is expected to be completed within 30 months from contract award, with commercial production of HRC anticipated in mid-2014, adding an additional production capacity of 1.6 million MTPA of product to the Company’s portfolio. Bin Athaeeth emphasised that well-equipped and highly-trained UAE nationals will supervise and follow up on the progress and the commissioning of the project. “We have made significant strides in nationalising jobs at our Company, mainly through the implementation of well-crafted strategies and initiatives that aim at raising the numbers of our UAE national technical staff. We have also provided our talented nationals with appropriate training to ensure that the increase in their numbers would
be in tune with the developments taking place in the UAE’s industrial sector, and Abu Dhabi in particular,” he said. The Company has already succeeded in increasing the percentage of UAE nationals handling top administrative and operational jobs to 62 per cent.” Bin Athaeeth indicated that these expansion plans reflect the resolve of the Government of Abu Dhabi to strengthen the basic industries in the Emirate and to promote it to become a hub for manufacturing in the region. He said that the Company will remain dedicated to the process of implementing its plans to establish the first and largest integrated steel manufacturing complex in the region by 2015. Company’s competitive advantage and promote it to international standards.
With Us, You are in the Safest Hands.
World Cup investment programme to hit $125bn over five years preparing for the 2010 World Cup. And costly though this might appear, policymakers in Doha are unlikely to find themselves having to cut back their ambitions.
With the backing of its immense hydrocarbon wealth and predicted GDP growth of 18 per cent in 2011 alone, Qatar has outlined its vision for an ultra-compact, ultra-modern World Cup that will rely on the very latest in technological innovation. What’s more, it will be boosted by an investment programme that will see Qatar spend more than $125bn in the next five years on construction and hydrocarbon-related projects. The 2022 World Cup will take place at 12 stadiums in seven ‘host cities’, all within a relatively compact radius of around 60km. Three of the 12 stadiums will be renovated from existing structures, and a stadium construction and renovation budget of approximately $3bn has been projected. In addition, Qatar submitted an estimated expenditure budget of more than $900m (inflation-adjusted) for the 2021
Confederations Cup and 2022 World Cup tournaments.
“In order to execute these massive plans in a timely fashion, Qatar might resort to borrowing in the short- to medium-term,” suggests Ciszuk at IHS. “They borrowed to fund their LNG expansion but they’ve pretty much paid that debt off by now, and so the revenues that have previously gone towards servicing billions in project finance, are just now starting to add up into their sovereign wealth fund.
In all, Merrill Lynch estimates that the total cost of preparing to host the world’s most-watched sporting event could be as much as $65bn, or around $40,000 per head in Qatar, compared to the $11.4bn or $232 per person, that South Africa spent
“They will have much more cash in their hands in the coming years, and if they need a little more, then they will again go to the debt markets,” he adds.
Empower to build Dhs250m plant in Dubai’s Business Bay
Qatar awards Hyundai E&C $434m museum contract
FIFA Cup to boost infrastructure development
The CEO of Emirates Central Cooling Systems Corporation (Empower) has announced plans to establish a plant in Dubai’s Business Bay at a cost of Dhs250 million. CEO Ahmad Bin Shafar has added that the plant will cater to customers on 14 million square feet of land in Business Bay, where a number of previously stalled projects are coming back online following the financial crisis.
Qatar Museums Authority has awarded Hyundai Engineering & Construction a $434 million contract to build a national museum in the Gulf country. Upon the contract, the South Korean construction firm will construct the museum on a site of 46,000 square metres in the country’s capital Doha. The company added in a statement that it expected the construction work for the facility to take 33 months.
16 DOSSIER October-December 2011
“They have an outstanding rating.”
The smallest nation ever to host a World Cup, Qatar has committed to billions of dollars worth of spending on stadia, transport, accommodation and other infrastructure. In September 2010, a FIFA inspection team spent 74 hours in the tiny Gulf nation of Qatar. And what they saw during their time there has made history not just for Qatar, but for the entire Middle East: in December Qatar became the first Middle East country to claim one of the biggest prizes in sport, the right to host the 2022 World Cup finals.
WE PROTECT YOUR INVESTMENTS ■ ■ ■ ■
wide product assortment tailor made solutions certiﬁed systems for all corrosion classes professional technical service
ANTICORROSIVE COATINGS For more information visit www.hempel.com
continuous development of new products
application of the coatings according to high standards
inspections and quality reports
Dubai property prices may drop by 15pc Average sale prices in the Dubai property market are expected to fall 10 to 15 per cent across Dubai during the remainder of this year, Matthew Green, head of research and consultancy at CBRE, said. “However, we have to consider the fractional nature of the market as it stands, where individual developments and properties are seeing price movement as opposed to the whole shifting in tandem, as was starkly apparent during the peak,” he added.
IMF forecasts 20pc real GDP growth in 2011 Of course, it should be remembered that only 20 per cent of Qatari residents are nationals: the country boasts a majority expatriate community comprising more than 100 nationalities, and attracted to Qatar by its rapid economic growth on the back of high oil and gas prices. And while Qatar is attempting to develop its nonenergy sectors, the country is still dependent on oil and gas for more than 50 per cent of its GDP, or roughly 85 per cent of export earnings and 70 per cent of government revenues. The International Monetary Foundation said in March that it expects real GDP growth of 20 per cent in Qatar in 2011, up from 16 per cent last year, on the back of strong gas production and prices. Moreover, government investments will support an average growth of nine per cent in the non-hydrocarbon sectors in the years from 2012 to 2015, the group said. However, not all are 18 DOSSIER October-December 2011
convinced that the diversification of Qatar’s revenue streams, will be as easy as spending the money in the first place. “In reality it is going to be very difficult to diversify successfully away from hydrocarbon revenues,” warns Ciszuk. “When you have such a small country with such a small indigenous population, sitting on such a massive resource, it’s very hard to create other industries which could rival that big income flow. From whichever income stream it is sourced, some of this money will be required to equip each World Cup stadium with solarpowered air conditioning. It will also go towards a $25bn rail and metro network, a seaport and a 40km bridge linking the country to Bahrain. According to a December 2010 report by National Bank of Kuwait (NBK), the winning bid is bringing renewed impetus to many infrastructure projects vital to growing Qatar’s tourism sector.
Logistics sector growing at rapid pace The logistics sector in the Middle East is growing 25-30 per cent YoY led by the markets in UAE and KSA, according to COO at DHL Express for the Middle East and North Africa. The spokesperson further stated that the speed of development and growth within the region specifically has been – and continues to be – particularly fast paced.
Alstom awarded contracts Power and transport engineering group Alstom has been awarded two new contracts worth $141mn to supply air-quality control equipment in the Middle East. According to the terms of the contracts, Alstom will provide equipment to filter and recycle polluting gases at an aluminium smelter in Abu Dhabi and at a power plant in KSA.
World Cup infrastructure spend to help diversify economy “Qatar is set to benefit enormously from currently planned spending in general, as well as from the impact of the World Cup,” says Wajih Al Boustany, an economist at NBK. “Hosting the World Cup foremost adds a sense of urgency and an ultimate hard deadline for the completion of projects critical to a successful hosting,” he continues. “This vast spending programme will also help diversify the economy away from hydrocarbons. Moreover, the private sector will have a greater role to play, reducing the government’s contribution in the economy.” According to NBK, the investment
in infrastructure will also help relieve some of the bottlenecks and shortages that have built up in many areas, because expansion in infrastructure had not kept up with the rapid growth of the economy or population. The new investments will pull the economy back into balance and help set the stage for further growth in the future. Moreover, NBK estimates that Qatar’s spending could see the GCC region as a whole benefit from a spill-over effect, specifically with regards regional contractors, and financial institutions. “This is especially true for the many contractors in the region
that have built up their stocks and operations in the region, prior to the crisis-induced slowdown,” says Al Boustany. “Intra-regional trade would also get a boost. A good deal of the raw materials involved in the construction of many projects will be sourced from neighbouring countries. “Large regional financial institutions would also benefit by sharing in financing and servicing the plethora of projects,” he adds. “This would be especially the case as more and more regional companies take part in the execution of the different projects and look for local and regional financing.”
Read your favourite construction magazine on a quarterly OCT - DEC 2011
NEW INFRASTRUCTURE PROJECTS GET THE NOD New RO6mn facility in Sohar Industrial Port Floating dock at Duqm gets approval Tenders floated for $400m Ghubrah Desalination Plant and National Railway Network Design
basis. Whether you are looking for new partnerships, business contracts, material procurements or experts’ guidance, DOSSIER CONSTRUCTION is the perfect information partner to take you ahead in the business.
INFRA OMAN 2011 SPECIAL
INSIDE: Iron & Steel • Paints • Formwork • Projects • Building Materials
For marketing enquiries contact: Shivkumar : 99267159, Email: email@example.com Girija: 99279359, Email: firstname.lastname@example.org
Fabrication Modular Process Skids Heat Transfer Equipments Pressure Vessels Columns & Reactors Storage Tanks Piping Pre-fabrication Containerized Utilities Vessel Repairs Special Services
EPC Projects Gas & Oil Facilities Steam & Water Injection Facilities Power Plants Tank Farms Pipelines & Flow Lines HV Transmission & Distribution Facilities Process Facilities (Greenﬁeld/Brownﬁeld) Tank Repairs & Refurbishment Process and Power Facility Revamps
Maintenance Annual Maintenance Contracts Turnarounds & Shutdowns Valve Repair & Refurbishment Static Equipment Maintenance Rotary Equipment Maintenance Cleaning of Static Equipments NORM Decontamination Specialized Coatings Saekaphen
| EPC | FABRICATION & MANUFACTURING | MAINTENANCE | Corporate: P.B 51,P.C 124,Al-Rusayl, Muscat, Sultanate of Oman Tel:00968-24390500,Fax:24489347 email@example.com
Rusayl Works Plot No.82/83,Road No.2,P.B 51,P.C 124 Rusayl Industries Estate, Al-Rusayl,Oman Tel:00968-24446294,Fax:24446297 firstname.lastname@example.org
Sohar Works Plot No.256-259,261 & 262 P.O Box.93, Postal Code 327, Sohar Industrial Estate,Oman Tel:+968-26750987,Fax:26751643
Abu Dhabi OfÀce Arabian Industries LLC Al Hana Building, M2, Unit 211, PO.Box 39646, Abu Dhabi, UAE Tel:+971 2 6396166, Fax:+971 2 6396155
Bahrain approved $3.97bn industrial projects A top Bahraini official has said the government has approved industrial projects worth more than BD1.5 billion since 2009. The Industry and Commerce Minister Hassan Fakhro said that more than 300 of these 546 projects – worth BD942 million – have already been granted licences. The ministry granted initial approval to set up 242 industrial projects worth more than BD495 million in 2009 and 253 worth more than BD637 million in 2010.
Qatar commits to billions of dollars of LNG-funded spending
Environmental Construction Exhibition in Dec
While heavyweight competitors including Australia and the US have been left licking their wounds, Qatar is now facing up to the reality of what it has achieved – and what it must deliver over the next decade. The smallest nation ever to host a World Cup, Qatar has committed to billions of dollars worth of spending on stadia, transport, accommodation and other infrastructure. Under that weight of expectation, finances shouldn’t be an issue. Qatar has a population of some 1.68 million, of whom more than 85 per cent live within a 20km radius of the capital, Doha. It also boasts one of the world’s most lucrative Liquefied Natural Gas (LNG) fields, which has made it one of the wealthiest nations, per capita, on the planet.
Advanced Construction and Technology Services (ACTS) is launching the first Environmental Construction Exhibition in parallel with the Future Concrete conference which will take place from December 12 to 14 in Dubai. The construction process and building not only consume the most energy of all sectors in the Middle East and create the most CO2 emissions, they also create the most waste, use most non-energy related resources, and are responsible for the most pollution.
“Qatar has tremendous income from LNG and oil exports, and is running a massive budget surplus every year,” says Samuel Ciszuk, senior energy analyst for the Middle East and North Africa, at IHS Global Insight. “The huge [LNG] field off Qatar’s shore was always too deep for Qatar itself,” he continues. “They could have developed a small part of it to cover domestic demand, but that wouldn’t have paid its way for quite some time. Exporting the gas was really what was needed to be able to monetise such a massive field, and as soon as they realised the LNG market was big enough, they went for it.” 22 DOSSIER October-December 2011
“Participating in the Environmental Construction Exhibition this year will be a very effective marketing platform for suppliers of innovative construction products and services.” said Abdul Kader Kairouz, Chairman of the Organising Committee and ACTS Vice-President. “We are proud to launch the Environmental Construction Exhibition alongside with the Future Concrete Conference” said Dr. Maher El Barrak, chairman of the technical committee and head of the conferences and training division at ACTS. This combination will link hot topics in concrete construction with the practical aspects of green building, eco-construction, environmental consulting, modular construction, demolition recycling, carbon absorption and waste and water management.
POWER PLAYER JINDAL SHADEED IRON & STEEL LLC (JSIS), DOYENS OF IRON AND STEEL MANUFACTURING SEEKS TO BOOST INFRASTRUCTURE AND CONSTRUCTION ACTIVITIES
DRI Module to produce 1.5 million tonnes per annum of HBI. Presently, we sell HBI to national and international markets. We have ordered 2 MTPA capacity steel making facilities which include Electric Arc Furnace, Ladle Furnace and Continous Billet Caster with associated facilities. What are your core strengths? Our core strength is mining, steel and power. However, we are also interested to go for mining and processing business. Who are your clients? Our clients are Sohar steel in Oman. As for our global clientele, we have customers from UAE, Egypt, Italy, Spain, China, India, Kuwait etc.
D.K. Saraogi, Executive President and Head, Jindal Shadeed Iron & Steel LLC
How will Jindal Shadeedâ€™s collective effort support the strong demand for steel in the Middle East and North African countries? The collective support of Jindal Steel and Power Limited (JSPL) with the addition of upstream and downstream facilities to the present plant in Oman will definitely cater to the strong demand for steel in the GCC and MENA countries. 24 DOSSIER October-December 2011
Tell us briefly about your products and facilities. Our product in Oman is Hot Briquetted Iron (HBI), which is raw material for steel making units. The facilities at Oman are a 1.5 MTPA DRI Plant with associated facilities and a jetty with two ship unloaders. Tell us about your current projects. Jindal Shadeed currently possesses a
How is the Shadeed acquisition a major step in the international strategic expansion for JSPL? Jindal Steel and Power Limited (JSPL) now has an international presence as a result of the acquisition of the Oman plant. This is a major step in the global expansion plans of JSPL. We have also entered into steel business in Bolivia by acquiring iron ore mines. The Bolivian plant is going to further expand by installing Pellet Plant, DRI Plant, Steel Plant and Power Plant. JSPL is also making inroads in Congo, Mozambique, South Africa and Indonesia.
Partnering in the Development of a Strong Nation.
Jindal Shadeed Iron & Steel L.L.C is the world’s number one plant with HOTLINK Technology and Oman’s first Integrated Iron & Steel Industry. It has the capacity of 1.5 MTPA (Hot Briquetted Iron). After downward integration of the plant with SMS and Rolling Mills, Oman will be self sufficient to meet its domestic demands in pipes, Rebars and Structural and will gain from import substitution. Our semi-finished and finished product capacity selection has been aimed at supporting the GCC and neighboring countries’ demand to a large extent thereby making the Sultanate of Oman a prominent GCC member in contributing to the reduction of import from countries outside of GCC. The produce from the plant will contribute to Revenue Earning and GDP growth of the Sultanate of Oman. There will be potential for development & establishment of ancillary industries to support the needs of integrated steel plant. Jindal Shadeed Iron & Steel will create substantial employment opportunities with training and development. Above all it will be a boost to infrastructure & construction activities in the Sultanate.
Email: email@example.com www.jindalshadeed.com
By Sudhakar Reddy, GM, Al Habib & Co.
A NUMBER OF PLAYERS IN THE REAL ESTATE INDUSTRY HAVE ADOPTED THE BUSINESS MODEL OF VERTICALLY INTEGRATING AND PARTICIPATING ON ALL LEGS OF THE VALUE EXCEPT FOR DESIGNING
n any industry, different players adopt different strategies depending on their strengths. Thus one can draw a strategic map of an industry and find that different players occupy different positions on the map. The real estate industry in Oman is no different. The two variables on which a strategic map can be drawn are size and the degree to which each player participates in the various legs of the value chain. The value chain itself can be drawn as follows. There are companies that participate on all legs of the value chain except perhaps designing and there are industry players who outsource everything and only fund the project. There are even players who just buy a property after is it completed and let out. Integrated Tourism Projects (ITP) are a good example of players participating 26 DOSSIER October-December 2011
in sourcing the land, preparing a design brief, funding it and selling it. The actual construction, which is labour intensive and requires deep core competencies in the case of large projects, is outsourced. The designing is also outsourced since it gives access to the best architects in the business. Large projects although they are not ITPs have a similar business model. A number of players have adopted the business model of vertically integrating and participating on all legs of the value except possibly designing. Here again returns are attractive but only if there are significant competencies a player possesses in all parts of the value chain. This business model, which is a successful one, has a size limitation as very large projects cannot be developed on this model owing mainly to the fact that construction is labour intensive and cannot be scaled up or down with time. Thus players who have
adopted this model are small and medium size property developers. Another strategy is simply to buy properties after they are built and leased. The advantage of this model is that most of the risks are eliminated since the project is completed and leased out. However, lower risks go with lower returns. Pension funds follow this model although some of them have also been developing their own properties in order to get higher returns. The returns depend on the degree of vertical integration but more importantly on the degree of competence a player has in the parts of the value chain that it has decided to participate in. This is critical and must be understood clearly. Players with a similar business model can end up with vastly different returns depending on the degree of competence they have in their chosen activities. Source: Oman Economic Review
based dredging company which, incidentally, has been instrumental in literally paving the way for the construction of the dock. This historic achievement was celebrated in Duqm at a grand ceremony held under the auspices of HE Said bin Hamdoon Al Harthy, Undersecretary of the Transport and Communications Ministry for Ports and Marine Affairs, in the presence of Sheikh Sultan bin Mohammed al Nuaimi, Wali of Duqm and other dignitaries of the Al Wusta Region and members of ROP.
THE WAY NICO VINCART, PROJECT MANAGER, JAN DE NUL DREDGING SPEAKS ABOUT THE COMPANY’S ROLE IN BUILDING AND UPGRADING THE DUQM PORT COMPLEX. A REPORT BY VISVAS PAUL D KARRA
uqm’s development as a new industrial destination hinges on the shape of the port facilities, which include a crude oil export terminal and a strategic storage facility, a free trade zone and a downstream industrial area in addition to an airport, port, dry dock, commercial and residential areas and plans for tourism development. Thanks to its proximity to the busy regional sea-lanes traversing Oman’s coastal waters, Duqm is being conceived as
28 DOSSIER October-December 2011
a main maritime gateway that will serve as an ambitious industrial and commercial hub. For the shipping industry, one of the most exciting things that is happening on this side of the Arabian Sea is the giant dry dock facility, which was opened for operations by Oman Dry Dock Company (ODC) in March this year. Most notably, the dry dock received its maiden customers namely two ships of Jan De Nul Dredging (JDN), the Belgium-
Nico Vincart, project manager, JDN, Oman Branch, commenting on this accomplishment said, “As we have been involved in construction of a part of the ship repair yard, we were honoured to be the first customers of the dry dock. We would like to thank the Ministry of Transport and Communications (MOTC) and ODC for this unique opportunity.” PORT PROJECT Oman’s Ministry of Transport and Communications awarded a consortium of companies, which included Consolidated Contractors Company (CCC), Sezai Turkes – Feyzi Akkaya Ltd (STFA) of Turkey, and JDN the contract for the maritime works for Duqm’s new port in April 2007. The scope of works specifically for JDN consisted of the deepening works of approach channel together with the reclamation works behind the newly built quay walls. All works are well ahead of schedule with only 20 per cent of the material yet to be dredged and 10 per cent of the sand to be reclaimed. The main part of the port and the entrance channel has now been dredged and the works at the ship repair yard and the commercial quay are fully completed. Subsequently, the MOTC also awarded the expansion work of the Duqm port complex at an additional cost of RO335mn to the same CCC-STFA-JDN consortium. The earlier contract of RO187mn
together with the new contract, scales up to around RO522mn for the integrated marine works infrastructure. The investments will go towards extending the breakwaters and deepening the harbour basin and entrance channel in addition to the already existing works for construction of breakwaters, quay walls, as well as a substantial dredging and reclamation component. The lee breakwater was also realigned and pushed out further into the sea, while the main breakwater has been lengthened, thereby creating a considerably expanded port basin. As such, the total length of the breakwaters has grown from the original 5.3 kms to 7.7 kms under the revised plan. The most significant impact will be on the main breakwater, which will now boast 2.25 kilometres of quay wall for commercial berths, from an earlier quay length of 700 metres. The commercial berths will be equipped to handle container, grain, cement, commodity, and a range of dry bulk carriers. DREDGING WORKS The scale of the dredging work, which began in 2007 and will be fully completed in 2012, is huge. Vincart gives some mindboggling figures: Around 70 million cubic metres of soil needs to be dredged and around 15 million cubic metres of sand has to be reclaimed behind the quay walls, as it will be very big with two breakwaters. And then you have the quay walls, the commercial quay, 2.2 kms long and the government quay, which is 1200metres. For the shipyard, it will be 3 kms of quay and the two graven docks (dry docks) will be 410metres long each. The classic form of drydock, properly known as graving dock, is a narrow basin, usually made of earthen beams and concrete, closed by gates or by a caisson, into which a vessel may be floated and the water pumped out, leaving the vessel supported on blocks. The keel blocks as well as the 30 DOSSIER October-December 2011
bilge block are placed on the floor of the dock in accordance with the “docking plan” of the ship. At the moment, five JDN vessels are doing the dredging work non-stop. Recently, one new cutter suction dredging ship arrived from Croatia to join the fleet of ships. This new vessel has three big split hopper barges. And then the company also has trailing suction hopper dredgers on site. Explaining about the dredging operations, Vincart says that the cut soil is put in the barges and taken to
docked for three days. Some of the dry dock operations, which were carried out on JDN vessels, included cleaning of the hull for sea growth and then polishing of the propellers and maintenance of the engines. Effectively the dry dock is fully functional. JDN is part of the Jan De Nul Group, which was founded in 1938 by Jan Frans Jozef De Nul as a civil construction company. Responding to the market opportunities at that time, the De Nul family accepted its first dredging work in 1951. Since
“We have put 10 million cubic metres of sand behind that to make a nice quay wall that is also ready now. In May 2012, we will hand over the complete port to the ministry of transport and communication.” an offshore disposable area. There is a pre-identified natural pit in the sea just off Duqm and JDN is filling up this pit with the soil. For the land reclamation, sand is brought from 40kms off shore. This is good quality sand, which is dredged and brought to the shore in the hopper to reclaim the land behind the quay wall. Thus, JDN has first built the breakwater and then the quay wall and in between is the water 10 mtrs deep approximately. “We have put 10 million cubic metres of sand behind that to make a nice quay wall that is also ready now. In May 2012, we will hand over the complete port to the MOTC,” he says. The port is already open for the dry dock operations. Commercial vessels began to arrive since October 2010. Some GIB cranes arrived for the dry dock from China. And in the dry dock, JDN barges were
then there has been no looking back. The activities of Jan De Nul Group are based on three pillars: dredging activities, civil construction and environmental works. The Group has the world’s most modern and technologically advanced dredging fleet at its disposal. In 2009, Jan De Nul Group reached a turnover of 2.1bn euros (69 per cent dredging activities, 18 per cent offshore projects, 11 per cent civil works and 2 per cent environmental projects). PEOPLE AND VESSELS In a nutshell, that is the driving force behind Jan De Nul Group. Thanks to the 5,000 employees and its ultramodern fleet, today the group ranks at the top of the international dredging and marine related industry. Also with regard to civil engineering and environmental works, it is one of the largest contractors in Europe. Source: Oman Economic Review
THE LEADING EDGE
Harald A. Hartung, Managing Director and Mohammed Haneefa, Technical Manager, Doka Muscat
DOKA MUSCAT LLC, WITH ITS INTERNATIONAL TEAM OF EXPERIENCED STAFF, HAS ESTABLISHED ITSELF AS A RELIABLE LOCAL PARTNER FOR ALL FORMWORK-RELATED NEEDS
he Doka Group is one of the global leaders in the formwork industry with a presence in 70 different countries, providing construction companies high-performing, safe and dependable formwork solutions. Their diverse product portfolio includes system components; wall, floor, load-bearing, and safety systems as well as comprehensive consulting, planning and service offerings.
32 DOSSIER October-December 2011
In July 2009, Doka opened its doors to Oman and established Doka Muscat LLC, bringing along with it over 50 yearsâ€™ of expertise. In a short span of two years, the organisation has already positioned itself as market leaders as far as systemised formwork is concerned and has also established a good working relationship with contractors in Oman. As one would expect from any
reputable organisation, Doka runs a state-of-the-art facility in Seeb that is spread over 12,000sqm and houses all the stock including new and used material, not only available for rent but also for purchase. Harald A. Hartung, Managing Director (who recently took over the reins following the retirement of Geir Jensen) affirms, â€œOur equipment value is about Rials 6.5 million and given the material we have
in stock, we are able to fulfil any client’s demand within a maximum timeframe of 48 hours. Whether it is for rent or for sale, the components are available to be dispatched immediately so that our clients do not face any loss of time. This is one of core strengths.” This attribute also extends to their office in Al Khuwair where ultramodern systems are used to manage and direct their technical and administrative operations. Hartung explains, “You cannot be a modern, competent formwork supplier without technical knowhow. The internal system, keeps control of our materials and our business development. We have a sophisticated internal system which, within an hour of data processing, can tell us each and every detail of our material and its location, be it anywhere in the world.” Thanks to Doka’s efficient global network, customers can rest assured that regardless of location, materials will be promptly delivered. All goods are sourced from their headquarters in Austria which is run on the principles of innovation and sustainable development with automated and technological advanced computer systems, leaving very little room for human error. The two years that Doka has been operational in Oman has brought with it a unique set of challenges for the organisation. “We have had to completely overhaul our way of thinking and communication in order to cater to the market and clients here,” admits Hartung. “Jensen had already done some of the groundwork for us and opened up channels and to our surprise, we experienced a surprising flexibility with mid-size Omani contractors. They are open to modern ideas and are supportive of changes in designs and materials. They are open to new challenges and utilise modern technology.” This trend is
an encouraging pattern and Hartung believes there will be an upswing with respect to a shift towards modern building methodologies. Continuing in the same vein, he adds, “We would like to intensify our local partnerships. We hope that Omani Society of Contractors becomes a stronger force so that we are able to find suitable local partners. For us, Omanisation isn’t something to be enforced, b ut a means to achieve substantial development of the market.” Sustainable development also features highly on their agenda. “One of Doka’s founding philosophies
extremely sturdy and robust. “Also, our rental options may be considered a kind of sustainability. You use the formwork and give it back. We have the knowledge, the machines and tools and trained workforce to maintain it and keep it operational for years and years.” Doka Muscat’s team comprises experienced project engineers, supervisors and operations/ logistics specialists to bring forth products and services that are high quality, functional and reliable. Doka also invests heavily in providing opportunities to its staff to further their knowledge and
We would like to intensify our local partnerships. We hope that Omani Society of Contractors becomes a stronger force so that we are able to find suitable local partners. has been sustainability,” confirms Hartung. “And today all our employees and senior management follow these principles that have been introduced by the founders for all their endeavours.” Keeping in line with this philosophy he goes to explain how everything in their facilities is fully recyclable. “Until three years ago, the sawdust and timber were used to make briquettes for chimneys. But now, we have cooperation with a neighbouring power plant. We feed the plant with sawdust and get it back in the form of energy which reduces our external energy consumption and carbon footprint.” Even the material that they use is
technical prowess via training and development. A highly modern, state-of-the-art IT network allows them to be in touch with their peers in their offices worldwide. Hartung hopes that the future will see an increase in the use of systemised formwork. “I would say that the Omani market comprises 90 per cent traditional formwork and the rest systemised formwork. Our aim is to increase awareness of contractors of the benefits of using systemised formwork and also focus on increasing the share of using systemised formwork. Ultimately, we would like to develop our staff and our business and create a win-win situation for all.” October-December 2011 DOSSIER
TRAFFIC SAFETY ROYAL OMAN POLICE AND OMAN INTERNATIONAL TRADE & EXHIBITIONS ANNOUNCE TRAFFIC SAFETY EXPO 2011 TO BE HELD IN OCTOBER
he causes, time and characters change, but the scenario is repeated with a news article announced in a daily local newspaper titled “A road accident claims lives of a number of individuals” with further details on the number of victims. The immediate question that arises here is how many times people need to read similar news in order to stop for a moment and review the mistakes that cause the demise of so many lives? Two of the most risky factors that increase the rate of traffic accidents are wrong overtaking and over speeding, mostly by young reckless drivers who are not aware that these two factors may cause the decease of innocent lives. A big segment of young inattentive
34 DOSSIER October-December 2011
motorists in the Sultanate overtake without leaving space between vehicles before overtaking and without signaling to indicate the overtaking which is about to take place. Consequently, many accidents occur due to wrong actions taken by young motorists. According to recent reports issued by the Royal Oman Police during Eid Al-Fitr holidays, around 234 traffic accidents were reported across the Sultanate. Most of these accidents were caused by speeding and reckless overtaking. The highest number of fatalities were reported in Al Batinah
and Dakhiliya region with six deaths each. These statistics indicate that there should be a campaign especially for the youth to further instil road safety awareness among the society. To achieve this, Oman International Trade & Exhibitions (OITE) in cooperation with the Royal Oman Police will organise the Second Traffic Safety Expo, which is scheduled to be held from 18 to 20 October at the Oman International Exhibition Centre. TOWARDS A SAFER SYSTEM – INNOVATIONS ZONE TO BE INCLUDED AT THE EXPO A special corner dedicated for outstanding and latest innovations on road safety to foster and improve a traffic safety culture in Oman will be staged in the Traffic Safety Expo 2011.
“Unless something is done to improve road safety in the Sultanate, the rate of the accidents will not decline. From this standpoint, the Innovations Zone at Traffic Safety Expo 2011 will offer a wide range of high performing solutions to enhance road safety culture and to further reduce the number of road accidents in the country,” informed Ebrahim Taher, Project Manager at Oman International Trade & Exhibitions (OITE), organiser of the event. Taher added, “To meet the challenges of road safety, there should always be an active involvement from the public. Therefore, the Traffic Safety Expo 2011 will offer an opportunity for the public to increase their awareness and educate others on 36 DOSSIER October-December 2011
the significance of traffic safety in the country.
dedicated to children at the Traffic Safety Expo 2011.
Taher informed that the event will also host a road show, a small workshop delegated by associated sponsors, and a road safety painting session with active participation from NGO’s and the public.
This dedicated corner will contain small cars for children to experience, teach and educate them about traffic rules. Besides, quizzes will be distributed across the various schools including crosswords and a quiz on road safety rules. A special drawing programme will also be organised for the children and the participants at the event in order to achieve a successful outreach on the issues of traffic safety in the Sultanate.
SPECIAL CORNER FOR CHILDREN AT THE TRAFFIC SAFETY EXPO 2011 Statistics indicate that the rate of child injuries is around 20 per cent of overall injuries in traffic accidents, while unfortunately around 180,500 children under the age of fifteen die annually in the road accidents worldwide. From this standpoint, a special corner will be
Dossier is the media partner for this event.
‘We are driving a significant expansion of our retail network in the Sultanate to serve an ever increasing decorative segment as the market emphasis is shifting towards more sophisticated products and finishes,’ says Jacob Kuruvilla, Country Manager, Hempel Oman in a conversation with OER Dossier. Excerpts of the interview: Tell us in brief about Hempel. The Hempel Group is a leader in the production and sales of high performance coatings within the marine, protective, container, yacht and decorative market segments. Headquartered out of Denmark, Hempel has 21 factories, 47 sales offices, 3 main and 5 regional research and development centres, and more than 150 stock points strategically located around the world. How long has the Hempel brand been in existence in Oman? Hempel commenced its journey in Oman more than two decades ago with the motto, ‘number one in quality and service’. Since then, Hempel Paints has successfully serviced the protective and marine segments, setting new industry benchmarks within Oman. What is the overall size of the paint market in Oman and the share of Hempel in different product segments? Oman’s annual coating market size is estimated between 35-40 million litres – decorative paints account for 80 per cent share and industrial paints the remaining 20 per cent. The protective coating sector has been for some time the key area of commercial investment for Hempel at Oman. 80 per cent of our revenue in Oman is generated from our protective coating business, wherein we are the clear market leader with a market share in excess of 35 per cent. The decorative segment represents a significant part of the total coating volume requirements in Oman, and is also expected to keep 38 DOSSIER October-December 2011
ONE HEMPEL. ONE AMBITION.
growing. In line with our global strategy ‘One Hempel. One Ambition’, our top priority is to get significantly better market share within this segment. Marine market segment in Oman again is relatively much smaller in comparison to the decorative and protective market size. We have a leading position within this segment. Oman Shipping Company has been expanding its fleet and the dry dock at Duqm has also become operational. Do you think these developments are expected to make a significant impact on your business? No doubt developments such as increase in the fleet size of Oman Shipping Company and Oman Dry Dock Company’s (ODC) operations at Duqm (ODC) are of strategic importance for us as marine coating business is one of our core strengths. ODC had a soft launch during March 2011, and ever since every two out of the three vessels docking at the dry dock have preferred for Hempel protection. Once fully operational, ODC is expected to dock around 600 vessels annually. The estimated paint consumption then is 1.5-2 million litres approximately. Hempel expects to garner around 40 per cent share of ODC business at that time. Decorative coating sector has been a crowded field with many players firmly entrenched in Oman. What’s your strategy to penetrate it here? We currently have six competitors with a well-established manufacturing and distribution network in Oman. In the existing marker scenario, we would say that six is a company and any number over 15 can be classified as a crowd! Hempel will continue to leverage its high quality product range, with advanced technical support at all levels to retain and further expand its market share. We are driving a significant expansion of our retail
network in the Sultanate to serve an ever increasing decorative segment as the market emphasis is shifting towards more sophisticated products and finishes. We are well aware on the need to build relationships among suppliers, architects, clients, consultants and applicators. Thus the whole chain contributes to the success of our products. Ok. Can you please share details of some of your innovative products? Hempasil X3, a new fouling release coating from Hempel, won four products awards internationally. One of the awards includes the Sea Trade Awards (also referred as the Oscar of the international shipping industry) for its contribution to protection of the marine and atmospheric environment within
coats paints reveal that even in the aggressive Middle East conditions, an exterior coating of this prime insulation material would cut down internal room temperatures by as much as 5ºC. Thermal insulation is the single most decisive factor in reducing energy consumption, by up to 40 per cent of the total energy costs. Contex Thermoguard is also available in a wide array of colours. It is believed that the price of paints have increased substantially over the past few months. Have you also increased the prices? Yes, it is true that the paint prices have escalated considerably over the past one year. Growing global demand; raw materials’ price hikes; shortages due to closure of
80 per cent of our revenue in Oman is generated from our protective coating business, wherein we are the clear market leader with a market share in excess of 35 per cent. the shipping industry. X3 has the potential to drastically reduce the amount of CO2 the shipping industry releases into the environment while also potentially saving ship owners thousands of dollars in fuel bills each year. HEMPATHANE HS 55610 is a two component VOC compliant, highbuild polyurethane top coat. It contains zinc phosphate and finds wide application as a “direct to metal” system in mild atmospheric environments. This product can be made available in a number of colours. Independent study on Contex Thermoguard water based top
resin plants; and the increase in crude-oil prices have all led to an increase in raw material costs for the manufacturing of coatings. Despite the crude prices having cooled off a little bit in the last few days, forecasts are that price of titanium dioxide (TiO2), one of the key raw materials for decorative paint, will continue to go up thus pushing paint prices higher during the coming months. Although we recognise that any price increase has a direct effect on our customers’ business, the circumstances have forced us to implement a price increase across the board for all our products. October-December 2011 DOSSIER
PERI (L.L.C.) FORMWORK SHORING ENGINEERING
Fostering Quality PERI Middle East offers cost-effective formwork and scaffolding solutions for every jobsite
Give us a brief background of your company With 825 million euros of turnover in 2010, PERI with its head office in Weissenhorn, Germany, is the largest manufacturer and supplier of formwork and scaffolding systems in the world and is a skilled partner of construction companies. With 5,500 employees, 48 subsidiaries and 100 high-capacity storage sites across the globe, we serve our customers with innovative system equipment and a broad range of services to realise construction projects in the most cost-effective manner possible. Tell us about your products and services that support the construction industry. Our broad range of equipment and systems offers the perfect solution for every requirement: formwork girders, panel and wall formwork, 40 DOSSIER October-December 2011
column formwork, slab formwork, climbing scaffold, platform systems, self-climbing formwork, shoring, slab props, push-pull props, formlining, brace frames for singleface concreting as well as anchoring systems. However, the PERI range of services goes far beyond production and system equipment sales and rental. In order that we can provide the most economical option possible, more than 850 PERI engineers worldwide – who are close to the customers and entrusted with their requirements – develop individual solutions. Additionally, we offer comprehensive services around formwork and scaffolding technology, perfectly tailored to the needs of the construction industry: Rental equipment services, cleaning and repair, formwork assembly, seminars and workshops at the PERI training centre and on-site briefings, through
to the development of the company’s own planning software. What are your core competences – how do they help you to cope with competition? We always focus on providing the best possible solution for every one of your building projects. The tremendous innovative strength of our internationally-operating company will also help the construction industry in future to build even more rationally, cost-effectively and safer with the most economical systems and solutions, and ultimately gain significant competitive advantages for each company. Tell us about your current major projects in the Middle East. Our current projects in the Middle East feature an interesting crosssection of our formwork, scaffolding
and engineering solutions. Apart from impressive multi-storey buildings such as the Regent Emirates Pearl Hotel in Abu Dhabi or the Twin Towers in Kuwait City, we also helped to realise a number of infrastructure developments such as the Wadi Adai – Al Amerat Road project in Muscat for which special formwork was also assembled. The construction of the 7.50km long, new road involved major concrete works, among others several 14m retaining walls which were built with proven PERI systems such as TRIO panel wall formwork as well as VARIO GT24 girder wall formwork. For the sophisticated 42m high bridge piers our experienced PERI engineers designed a solution with the CB climbing system, which gave our client Nagarjuna Construction Company the advantage of savings in manpower and costs for this project. For our client Al Adrak Trading and Contracting L.L.C. PERI delivered sophisticated formwork systems and engineering support for the Sohar University project. Furthermore, we take pride in various projects with our esteemed customer Teejan Contracting Company for the IWPP project, for whom we provided formwork for their cooling towers and DMF tank. We are also looking forward to future projects to come and to further expand within Oman. What is the current capacity of the plant? Do you have any expansion plans? We have invested heavily in preparing for future activities: for example, by greatly improving our service performance. For this purpose, we set great store on our engineering for planning operations to ensure a prompt service through the expansion of our production capacities as well as using top quality materials. Through the largescale expansion of the production facilities in 2008 at our main production plant in Weissenhorn,
“There are a lot of positive things to say about PERI and their systems. PERI provides excellent formwork technology, engineering services and site supervision at all times. Not knowing their systems before, I put my full trust in PERI on our Independent Water and Power Plant (IWPP) project in Taykka Salalah and have been fully satisfied. Despite using their formwork multiple times and under straining conditions during our project, all formwork components are still in excellent condition and we only need to change the plywood occasionally to make it as good as new.” – A.B.M Khan, Operations Manager, Teejan Group of Companies
Germany, PERI has already set the course for the future. Large, worldwide combined numbers of units lead to favourable manufacturing costs and reliable quality due to a high level of automation. In your kind of service, safety issues are very crucial. What is your own track record in HSE? With all our company activities, we attach great importance on capabilities for the future and ecological sustainability. Our product development is aimed at achieving the best utilisation of materials and, at the same time, minimum material use. Regarding the selection of raw materials and material procurement, we take into account ecological considerations while precise and efficient production processes ensure the highest product quality. As a result, our customers profit among other things from the high number of uses and longevity of our system equipment. In the process, the safety of site personnel has always had the highest priority for us because only the provision of safe working conditions guarantees effective construction progress. How are you positioned in Oman as well as in the Middle East? In connection with a wide range of customer-oriented services, we
provide economical solutions for all construction tasks. We have already been able to prove this during the numerous projects we have been involved in throughout the region. Furthermore, we were able to secure various prestigious projects in Oman such as the PASI Building project at Al Khuwair, Central Bank of Oman in Muscat as well as the IWPP project in Salalah, which shows our strength within this region supporting our expansion and growth in this interesting market. For the future, we expect to be involved in much more of the same in the Middle East. We are particularly looking forward to the FIFA World Cup in Qatar which will also include a lot of stadium construction and other projects. The first architectural designs of the new arenas are very impressive indeed and we can therefore expect to be participating in a range of interesting construction tasks over the next few years. We will be pleased to meet these exciting challenges which we would like to tackle in partnership with our customers.
Contact: Tel: +968(0) 24571090 Fax: +968(0) 24571050 GSM: +968(0) 98825753 Email: firstname.lastname@example.org email@example.com October-December 2011 DOSSIER
YOUSUF BIN AHMED AL – AAMRI TRADING LLC (YAAT)
A Holistic Approach Yousuf Bin Ahmed Al – Aamri Trading LLC (YAAT), with its diversified business solutions, offer quality-driven products and services
From Left: Parimal Sampat - Project Director, Yousuf Bin Ahmed Al Aamri, Dilip Sampat- Group MD, Vinal Sampat- GM, Sampath Kumar - Business Development Manager
stablished in 1992, YAAT Group is a multi-faceted company with diversified business interests that fall under one corporate structure, engaged in fire engineering and fire risk management services, industrial engineering services, commercial interiors, steel doors and roller shutter fabrication in the Sultanate of Oman. What are your vision and values? YAAT is committed to ensure continual improved customer satisfaction in the quality of products and associated services.
• Consistent quality services meeting the customer requirements including statutory and regulatory requirements. • Timely and Safe delivery • Cost Effective solutions. • Continual improvement of the Quality Management System. 42 DOSSIER October-December 2011
• Suitable working environment to meet the safety requirements. • Adequate competent resources for effective project management and implementation services. • Training and skill development programs to enhance the employee competency & participation to increase Company’s market share through quality and reliability. • Achieve statutory Omanisation targets set by government and provide adequate encouragement & participation of Nationals in Organizational development. • Enhance employee awareness and ensure satisfactory implementation of defined requirements Kindly give us an overview of your product portfolio. YAAT is among the top three players in the fire and safety engineering industry in the Sultanate. Our product portfolio comprises fire
protection, detection systems, and allied engineering services on a turnkey basis. Fire Engineering Division: Fire Suppression and Protection System, Fire Detection and Alarm Systems, Gas Detection Systems, Design Engineering, Passive Fire Protection Systems, Specialised Security and other Control systems. Steel Doors & Roller Shutter Division: Fire rated and Insulated Shutters; Polycarbonate, SS, Heavy Duty Aluminum Shutters; High Speed Rolling Shutters; Garage Doors and Sectional Overhead Doors; Dock Levelers and Dock Shelters; Fire Rated Steel and Wooden Doors; Hangar Doors and Sliding and Folding Doors. Commercial Interior Division: False Ceiling, Wall Paneling, Flooring; Specialized Wooden and Bamboo Flooring; Hospital X-Ray room Lead
lining; Raised Access Floor Systems; In-house Customized Furniture Fittings and Manufacturing; Allied Civil & Electro Mechanical Works (MEP); Gypsum Works and Acoustic/ Demountable Partitioning System; Mineral Fibre Tiles, Aluminium / Steel Ceiling Tiles; Shelving Systems and Turnkey Shop and office fit out Specialist. Tell us about the fire safety and security issues prevalent in the market. Fire is a code driven business controlled and regulated by governing agencies like NFPA and local civil defence agencies to ensure total safety and security. Fire systems are passive systems with no user interaction required while security systems are highly interactive this generates inherent conflicts in integration. The fire equipment manufacturers prefer a very clear demarcation between the fire and the other building systems. Although the fire industry is open to interface their systems at the island level yet it is not embracing the concept because flawed integration may compromise on the reliability of fire systems. What are the solutions that you provide to your clients? We having been engaged in the Fire Engineering Field for the last 18 years and have secured ourselves in a very prominent position in theiIndustry today with good back up design support and a fully-fledged projects department with team strength of over 170 people. We have provided seamless Fire Engineering solutions to power plants, refineries, airports, seaports, petro-chemicals, oil and gas, process and general industries, warehouses, residential and commercial buildings to name a few and have helped them in achieving their technology roadmap. It goes without saying that we are approved with all major consultants /EPC contractors /architects /builders / Government bodies and Government undertakings.
We offer a complete service, including preliminary site surveys, estimation, system design, fabrication, installation, testing and commissioning of Fire Engineering and Fire risk management services, Industrial Engineering Services, Commercial Interiors & Steel Door & Roller Shutter division throughout the Sultanate of Oman. YAAT is driven by quality and has embedded measures and processes in our operations to ensure a qualitative & quantitative approach towards customer satisfaction. We are fast approaching towards the ISO 9001:2008 Certification.
New Major Projects Awarded 1. Development of Muscat International Airport Fuel Farm Facilities – Fire Protection System Package 2. Development of Muscat International Airport (MC1): Hollow Metal Steel Doors and Louvers (EPC) 3. YAAT – Door & Shutter Division is awarded a Prestigious Project of Development Of Muscat International-MC1 4. GUTECH German University of Technology – Fire Protection System & Fire Rated Steel Doors and Frames Package
Which segments of the market do you cater to? – Power Plants & Substation – Onshore/Off Shore Oil and Gas – Telecommunication Exchanges – Airport Facilities – Hotels / Shopping Complexes – Residential / Commercial Buildings – Petro-Chemical Plants – Aircraft Hangers and Military Facilities – Industrial Plants and Warehouses – Ministry Projects / Car Parks – Hospitals and Clinics – Marine-Ships and Jetties What are your core strengths? YAAT Group comprises a family of interdependent entities, each with clear specialisations which share the Group’s extensive experience in Fire Engineering (EPC), Door Fabrication, Commercial Interior and allied
engineering services in Sultanate of Oman. This has enabled companies to grow in the group’s extensive markets and to maintain vibrant and interactive relationships with clients. The Group has a strong customer base, excellent working relationship with manufacturers and Systems Integrators, to maintaining the efficiency of its diversified activities. YAAT is managed by a qualified management and a proficient sales and marketing team to ensure total dedication to our commitments towards our valued customers. For over a decade, engaged in the Fire & Security Engineering Field, YAAT is a trusted name reckoned with reliability and quality services with good backup design support and a fully-fledged projects department and it is the policy of YAAT to provide products and services with high quality and value for money on time and in accordance with the agreed customer requirements. Our Personnel: Our Engineers are trained, certified, and experienced with the products that we use and committed to the company. Our Suppliers: We have exclusive relationships with most of our principals like LPG-Spain, RAPIDROP- UK, SRI-Malaysia, GSTUK, Maviguard – Turkey, Notifire by Honeywell , Chemguard-USA, Fairbanks Morse-USA etc. which enables us to use their technical expertise in selecting the appropriate product, design engineering and after sales support. Our Infrastructure and Resources: We have access to engineering, construction, installation, and fabrication (on-site/off-site) services within the group, which allow us to provide timely services to the client.
Contact: Tel: 24701020 Fax: 24703313 Email: firstname.lastname@example.org October-December 2011 DOSSIER
MUSCAT HEATERS INDUSTRY LLC
Quality at its Best Muscat Heaters Industry LLC are renowned for manufacturing a wide range of domestic and large capacity storage type electric water heaters that ensure quality, safety, durability and reliability
Ambrose Anthony, General Manager, Muscat Heaters Industry
What kind of water heaters do you have? We manufacture storage type electric water heaters used for residential and commercial purpose from 10lts to 300lts. capacity in GI and Glass lined type which also includes centralized water heaters for villas and hotels.
of residential housing in Oman the demand has increased drastically compared to previous years. We have a good demand for our water heaters in the prestigious on-going Government and private sector projects in Oman, GCC, Middle East and Africa.
What are the main features of your water heaters? The main features of our heaters are: The warranty against leakage for Glass lined heater which is seven years and for GI heaters is two years. We have a strict Quality Control and reliable after sales services.
What is your market share ? We have a strong dealer network in all the regions of Oman including Salalah which has given us a reasonable market share within a period of three years of starting the company.
What kind of demand is there in the market for your products? Due to the boom in construction 44 DOSSIER October-December 2011
What are the challenges you face in the competitive market ? The market for water heaters is very competitive as there are many water
heater manufacturing companies in the GCC. Also, many other brands from countries like Egypt, Italy and China are available. Despite this, we have been able to get a better market share due to our price, quality and service. Do you have any expansion plans ? We have massive expansion plans in the future to manufacture solar water heaters and instantaneous water heaters.
Contact: Tel: 22005703/22005704/24447021 Fax: 22005701/22005702 Ambrose Anthony, General Manager Email: email@example.com Website: www.alhosnigroup.com
OMAN INSURANCE COMPANY (P.S.C.)
Securing the Future The company’s commitment to the Sultanate of Oman as longterm partners is to benchmark standards
Anil C. Kapadiya, Country Manager, Oman Insurance Company (P.S.C.)
man Insurance Company (P.S.C.) established in 1975 by Royal Amiri Decree of Dubai, is a recognised, leading composite private insurer in the GCC and Arab World. OIC’s Muscat branch has been operational since July 2008 and is already the preferred underwriter of choice in the local market. The Muscat branch writes a balanced portfolio across all classes. The company’s commitment to the Sultanate of Oman as long-term partners is to benchmark standards, provide effective market leadership, raise insurance awareness, sustain penetration, achieve effective Omanisation, build robust infrastructure and provide world-class service. VISION AND MISSION OIC’s vision is to be a recognised provider with a passion for excellence and concern for people. The mission is to provide peace
46 DOSSIER October-December 2011
of mind, valued services, nurture partnerships and integrate people, process and technology. OIC is headquartered at DAFZA Dubai; over 15 branches in every Emirate and overseas operations in Sultanate of Oman and Qatar speak of its strong local and regional presence. Financially sound and professionally managed, OIC is dually rated, ‘A Excellent’ by AM Best and ‘BBB+’ by Standard & Poor’s. Oman Insurance is also accredited with Brand Value A+ by Brand Finance Middle East and listed amongst the top 25 companies in the UAE. In 2010 Oman Insurance Company wrote over RO250M (AED 2.44bn) in gross premiums across all classes returning technical profits of over RO24M (AED 232m) and annual net profits of almost RO10M (AED 94m). Shareholders equity of RO151M (AED1.45bn) and assets of RO 500M
(AED 4.8bn) further demonstrate the leadership, strength and market leading capabilities given the current conditions of the global economy. Oman Insurance underwrites all classes of General Insurance products including medical and life and goes that extra mile to tailor make bespoke covers. The company prides an R & D Unit to facilitate development of innovative customer centric products and solutions responsive to market needs of the Gulf population. The insurance programs are led by world-class and world leading re-insurers of repute. OIC with over 500 qualified and experienced insurance professionals, provides quality insurance products from across individual personal line insurances to risk based insurance solutions for industrial, commercial, energy, and construction sectors. The company takes pride in having been accredited with awards and certifications over the years. To name a few: General insurer Award (2005 and 2006), Training Initiatives Award (2005, 2006 and 2007), Life Insurer Award (2006) Corporate Social Responsibility Award (2007) and also the prestigious Mohamed Bin Rashid Al Maktoum Business Award in the Financial sector (2007) and the latest AON Hewitt award for ‘Best Employer In The Middle East-2011’. Oman Insurance Company continues to work towards greater market recognition across all aspects of its business with sustained training, responsible HR practices, good governance, social responsibility, responsible charity, CRM, innovation and market leadership by meeting or exceeding the emerging benchmarks from a challenging and dynamic economy.
Contact: Tel: 24789232 Fax: 24789283 Website: www.oicem.com
INTERNATIONAL HEAVY EQUIPMENT CO. LLC (IHE)
Expanding Horizons International Heavy Equipment Co. LLC (IHE) extends their portfolio of offerings with their latest addition, Montabert
best digging performance. Building on the reputation of Bobcat skid steer loaders, IHE introduced compact excavators in the three tonne class which has established itself in the segment in a short span of two years.
Montabert is based in the Lyon area of France and is the undisputed worldwide leader for the design, production and distribution of hydraulic and pneumatic demolition and drilling equipment for construction and civil works as well as the mining and quarrying industry.
Bobcatâ€™s Skid Steer Loader Model S130
nternational Heavy Equipment Co. LLC (IHE) of Zubair Automotive Group, represents many world renowned manufacturers of trucks, buses and equipment in the Sultanate of Oman. IHE is the exclusive distributor for Volvo Truck and Buses, Renault Truck, Bobcat, Putzmeister Concrete Pumps, Liebherr Concrete Batching plant and Truck Mixers, CASE Construction Equipment, Striker Tracked Crushing and Screening Plants, Proman Crushers, Sacme Block Making Machines, Ausa Mixers and Dumpers, Ferrari Truck mounted Cranes, Ingersoll Rand Winches and Tools etc, in the Sultanate of Oman. To cater to the ever growing needs of customers in Oman, IHE has recently tied-up with internationally reputed manufacturers from Europe and is now offering, several new products such as Parker Asphalt, Crushing and Screening Plants, Liebherr Tower crane, Liebherr Mobile and Crawler Crane, etc. The latest addition to the product range is the world renowned brand Montabert, specialised in hydraulic and Pneumatic Breakers.
IHE offers Bobcat equipment that are the market leaders in skid steer loaders and compact excavators with a variety of attachments that are used in construction, landscaping and also find application in the oil and gas industry. Bobcat skid steer loaders bring industry leading breakout force, faster cycle and quicker turns for the
Montabert has always shown a great sense of innovation and succeeding in being steadily at the forefront of technology: introduction of the first hydraulic rock breaker in 1969, then the first hydraulic drifter in 1970 and more recently in 1987 the first hydraulic rock breaker with automatic variation of energy. Currently the production premises at Saint Priest Montabert employs 350 persons and has a turnover of â‚Ź90 million, of which 85 per cent are exported worldwide in more than 110 countries.
Contact: Tel: 24527650 Fax: 24527651 Website: www.ihe-oman.com
Montabert Hydraulic breaker October-December 2011 DOSSIER
NATIONAL PLASTIC FACTORY
Voice of Calibre National Plastic Factory manufactures a wide range of products under stringent quality to provide the best for customer requirement
conduits in all gauges (Light, Medium, Heavy) – Sizes: 20, 25, 32, 38 & 50mm Fittings and Accessories As per British Standard BS4607 BSEM 50086/BSEN-61386-21, Gulf Standard 33/1984, Omani Standard 108/1984) uPVC Trunking: – Sizes: 16x16 , 25x16, 38x25, 50x50, 75x50, 75x75 & 100x100 (mm) As per British Standard BS 4678 Part 4, BSEN 50086 – 2-2/3341, BSEN50085, Gulf Standard 33/1984, Omani Standard 109/1986 uPVC Flexible Corrugated Conduits Sizes: – Sizes: 16, 20, 25, 32, 40 & 50 (mm) uPVC High Pressure Pipe and Fittings: – Sizes: 1/2, ¾, 1, 1¼ , 1½ , 2, 3, 4, 6 (inches) in C, D, E clauses As per British Standard 3505 /1986, ASTM 1785 Schedule 40 &80, Gulf Standard 675/1997 & Oman Standard 85/1985
The Company Strengths: EXPERIENCE • TECHNOLOGY • QUALITY
ational Plastics Factory is a division of Al Hosni Group International founded in the Sultanate of Oman in the year 1975 and is well-known to have developed industrial and household plastic packaging solutions for various industries with a high emphasis on quality and dependability. Apart from this, the company also manufactures high quality uPVC electrical conduits, trunking, fittings and accessories for cable management systems, uPVC pipes and fittings for high pressure applications, drainage, sewage and ventilation applications. With manufacturing plants located in Oman, United Arab Emirates and Egypt, National Plastic Factory has developed products for personal care and cosmetic, disinfectants and
48 DOSSIER October-December 2011
detergents, food and diary, chemicals and lubricants, automotive, perfumes, paints and aerosols. They have a diverse product portfolio: Plastic Packaging Products: – Plastic Jerry cans – Plastic bottles and containers – Aerosol caps and closures – Plastic parts for water heaters – Integrated manufacturing as per the clients requirement – Industrial Packaging Products The above plastic packaging products are available in different capacity, shapes and colours as per the customer requirements. uPVC Electrical Conduit, Fittings & Accessories: – Sizes: 20, 25, 32, 38 & 50mm
uPVC under Ground Drainage / Sewerage Pipes / Gravity Sewer / Waste Pipe / Soil & Ventilation Pipe – Sizes: 3”, 4”, 6” & 8” (inch) sizes As per British Standard BS 4660, BS5481, BSEN 1401-1, BS5255, BS4514 Construction Bucket, PVC floor Trap Grating/Lids: In different colors as per market requirement. “HOTACE” brand products hold Approval certificates from authorities like British Standard, Local related Ministries, GCC Approval for Export to GCC Countries.
Contact: Rajesh Babu, CEO Mobile: +968 99352297 Wilfred D’souza, Sales & Mktg Manager Mobile: +968 99840233 Email: firstname.lastname@example.org Web: www.nationalplasticoman.com
Steady Growth Target LLC has consistently shown a commitment to understanding and fulfilling clients’ requirements with their top-notch offerings
Nabil Nakhle, General Manager, Target LLC
arget LLC, a civil and electro-mechanical contracting firm, has been one of the key players in the sector in the Sultanate of Oman since 1976. Target started out as construction company, dealing with primarily residential construction projects, but today, they have widened their reach to not only commercial and government buildings but also heavily involved in electro-mechanical works (building electrical works, building plumbing works, HVAC and industrial electro-mechanical works) as well as infrastructure development (sewerage and drainage, water supply networks, water reservoir tanks and much more). Says Nabil Nakhle, General Manager, “We are focussed on delivering quality jobs on time and we are known in the market for our efficiency and punctual delivery. Not only do we deliver our jobs on time, but also known for quality projects. This is our unique selling point in this market.”
Keeping in line with their commitment to serve clients and consultants better, Target began an expansion process starting 2007. The expansion not only focussed on increasing operations, and as a result, their turnover but also saw an increase in resources like labour, construction equipment and support services. They also consolidated their ancillary services – Construction Equipment Workshops, Carpentry Workshops and Fabrication Workshops – and improved upon existing services. Target also stream-lined their finance and administration departments and in March 2010, achieved the coveted ISO Certification, ISO 9001:2008. “I would say this was a major milestone for Target, because in this line of business we always try to achieve better quality results in a safe environment,” adds Nakhle. The company also aims to continue improvements in its safety record throughout the whole spectrum
of its aspirations. And Nakhle is determined to stay abreast of the best safety plans and employ dedicated Safety Officers/Advisors. Target has produced its own HSE Plan/ Regulations, which is continuously reviewed and systematically revised, to cater for new and enhanced safety procedures as they are identified or required and the company hopes to achieve the required certification in this area at the earliest. It is of no surprise then why Target has amassed a strong and loyal clientele. Target has always been involved in key projects with respect to infrastructure development and building works. “The projects that we have been delivering since early this decade, have been challenging jobs in the water supply and sewerage systems. And we are proud to have completed these projects to the complete satisfaction of our clients.” Some of their current projects include: Wadi Bani Khalid sewerage scheme, Quriyat water supply project, upper Bowshar water supply scheme, Mawaleh water supply project and Wadi Kabir water supply scheme. Target has also partnered with Bam International for Oman Botanic Garden’s Phase Four development. This further strengthens Target’s reputation as a quality-driven organisation and helps them partner with reputable national and international contractors. The coming year, holds much promise for the company with further projects in the pipeline. Nakhle foresees that these projects will keep them busy quite possibly until 2013/2014 as well. “At the end of the day,” concludes Nakhle, “we want to continue providing the best to our clients, with an even greater commitment in the years ahead.”
Contact: 24503260 E-mail: email@example.com Web: 222.target-llc.com October-December 2011 DOSSIER
TO GLOBAL BUSINESS THE WINNING PERFORMANCES IN CHALLENGING ENVIRONMENTS HAVE SEEN OVER 5,500 COMPANIES REPRESENTING 137 NATIONS CHOOSING HAMRIYAH FREE ZONE AS A LAUNCHING PAD FOR THEIR BUSINESSES. DR. RASHID AL LEEM, D G SHARJAH DEPARTMENT OF SEAPORTS & CUSTOMS AND HFZA TELLS MOREâ€Ś What are the business solutions that Hamriyah Free Zone is offering to entrepreneurs? A hassle-free environment encompassing total ownership of businesses, 100 per cent repatriation of capital and profits, no taxes or duties, are a few to mention for Hamriyah free zone (HFZ) which was created to foster and encourage entrepreneurship, offering a range of services and facilities for every need and budget. Furthermore, from land lease for 25 years, pre-built warehouses, and from factories to executive office suites, HFZA has more than 22 million square metres of prime 50 DOSSIER October-December 2011
Dr. Rashid Al Leem , Director General Hamriyah Free Zone, Sharjah Department of Seaports & Customs
industrial and commercial land and a 14 metre deep water port to meet and exceed the demands of any business. HFZ has always been ahead of others in creating business environment and reducing barriers for international and local SMEs. Companies here can benefit from discounted lease rents with annual rate of approximately USD 8.22 per square metre only, fixed for five years with rent holidays of two months annually. Another important angle of our SME strategy is Hamriyah E-office: Executive, Economical, Efficient, Electronic. This unique and specially designed initiative with simple legal framework and documentation allows investors to set up the office in only 24 hours following four easy steps and for as low as $6,850. The innovative approach has already attracted hundreds of SMEs from across the globe. What strategic business clusters does Hamriyah Free Zone have? The Free Zoneâ€™s vision for smart regulations that facilitate SME growth and development enabled creation of the Hamriyah SME Zone, one-of-a-kind concepts bringing together diverse industries in an efficient manner. An area of approximately 10 million square metres has been specifically allocated to accommodate seven sub zones that form the Hamriyah SME Zone, levelled at Free Zone expense with base line data studies and the whole area is made ready to use with efficiency and agility. These strategic clusters comprise Oil & Gas Zone; Petrochemical Zone; Steel City; Construction World; Timber Land; Maritime City and Perfume Land. To simplify the startup process and support participation of SMEs, the Free Zone offers discounted lease rents that also include two months of rent holiday per year for the first five years, quick license issuance and minimised formalities. The most active is the Maritime Zone followed 52 DOSSIER October-December 2011
by Oil and Gas, Petrochemicals and Steel. In the Maritime zone, the activities are upstream, middlestream mainstream and downstream, from ship design to building and launching, to repairs and maintenance. HFZ has capacity to accommodate deep-draught vessels, handy-sized 40,000 dwt and oil rigs with dry-dock, ship lift and synchro lift facilities. How big is the market for HFZ in the MENA region? Located in Sharjah, United Arab Emirates, HFZ has an unparalleled location on the crossroads of international trade routes, enhancing SME access to the emerging markets
strengthen the small and medium sized enterprise (SME) sector. With its SME oriented strategy, how does Hamriyah Free Zone cater to microbusiness owners? The Hamriyah SME Zone is a specially designated area in the Free Zone supported by a remarkable deep and inner harbour facility. Hamriyah MB Zone is designed to specifically cater to the needs of micro business owners. Whether itâ€™s service or manufacturing or trading, Hamriyah MB Zone offers convenient and practical business solutions for micro business owners. MB zone, starting from 2500 square metres of land size and up with additive benefits
HFZ has always been ahead of others in creating business environment and reducing barriers for international and local SMEs. of Africa, Middle East and Asia with over two billion consumers. This encompasses, apart from other advantages mentioned above, application of one-stop-shop concept for quick issuance of licenses, a viable visa solution for business owners and their employees. Hamriyah Port, adjacent to the Free Zone, with its exceptional blend of facilities, technical knowhow and unmatched expertise, allows SMEs to ship all the necessary materials directly to the Free Zone, enabling them to save their valuable time, cost and labor. What are the facilities offered by HFZ for entrepreneurs? Could you refer to any innovative approach? True to its vision of creating an affordable yet world class free zone, Hamriyah Free Zone Authority has formulated explicit policies and designed special programs to
of cluster of seven SME zones to maximise their productivity. Could you tell us how many companies the world over have opted for HFZ as the launching pad for their businesses? There are over 5,500 companies from 137 countries that have a base in HFZ including international heavyweights such as Unger Steel, Larsen and Toubro (L&T), Standard Chartered, DHL, Essar and local brands Sharjah Islamic Bank, Dubai Islamic Bank, etc. What are the challenges faced by HFZ? Challenging Tomorrow has been our theme for the past 10 years, where the whole team is striving for HFZ business excellence which means 100 per cent customer satisfaction out of 100 per cent customer time serving the existing investors with highest service possible.
GCC CEMENT SECTOR ON RECOVERY PATH
THE PACE OF DECLINE IN GCC CEMENT SECTOR PROFITABILITY APPEARS TO BE SLOWING DOWN WITH THE CONSOLIDATED CEMENT SECTOR PROFITABILITY DECLINING BY 4.7 PER CENT YOY TO USD785.9MN IN H1 2011 COMPARED TO A DECLINE OF 12.0 PER CENT YOY IN H1 2010 54 DOSSIER October-December 2011
he GCC cement sector witnessed a recovery in its top line by 6.3 per cent YoY to USD2.31bn in H1 2011 after a decline of 13.6 per cent YoY in H1 2010. The increase in sales revenue has come largely from Saudi Arabia, which is the regionâ€™s largest cement market. Cement demand in Saudi Arabia has seen an upsurge on the back of implementation of massive construction projects. Sales revenue in Saudi Arabia has increased by 12.6 per cent YoY in H1 2011 compared to a 5.6 per cent YoY increase in H1 2010. On the other hand, UAE continued to witness a decline in its sales revenue albeit at a slower pace. UAE is still feeling the impact of the 2008-09 credit crises with major projects still on hold. Sales revenue in UAE declined by 2.9 per cent YoY in H1 2011 compared to a decline of a decline of 33.6 per cent YoY in H1 2010. Meanwhile, sales revenue in Oman and Kuwait increased modestly by 5.3 per cent YoY and 3.9 per cent YoY respectively. The pace of decline in GCC cement sector profitability appears to be slowing down with the consolidated cement sector profitability declining by 4.7 per cent YoY to USD785.9mn in H1 2011 compared to a decline of 12.0 per cent YoY in H1 2010. Saudi Arabia remains the only driver of GCC cement sector profitability with the net profit increasing by 13.5 per cent YoY in H1 2011. However, rest of the GCC countries continue to witness erosion in their profitability. UAE saw a decline of 56.1 per cent YoY decline in its profitability in H1 2011 while Oman has seen a decline in its profitability by 53.3 per cent YoY in H1 2011. UAE is suffering from excess capacity which is being reflected in profitability. The excess capacity in UAE is also having an impact of Omani cement sector with some cement being dumped in Oman. GCC cement sectorâ€™s gross margin declined by 100 basis points to
39.5 per cent compared to the corresponding period last year. Oman cement sector has seen the largest drop in its margins to 38.2 per cent in H1 2011 from 52.5 per cent in H1 2010 largely on the back of fall in realisation prices by 14.4 per cent. Meanwhile, gross margins got further depressed in UAE to 7.1 per cent in H1 2011 compared to 11.9 per cent in H1 2010. GCC cement sector ROE also declined by approximately 100 basis points to 15.3 per cent. CEMENT REALISATION PRICE Cement prices in the GCC averaged around USD66.0/ton in 1H-2011, as compared to USD68.6/ton enjoyed in 1H- 2010, a 3.8 per cent decline due to demand weakness in the GCC, especially from the UAE. Cement prices in all the GCC countries witnessed a decrease except KSA and Qatar. Oman marked the largest decline in prices by 14.4 per cent to USD65.3/ ton in 1H-2011 as compared to USD76.2/ton during the same period a year ago. This is due to depressed demand and the stiff uprising competition in the local cement market. Kuwait, which witnessed the second largest decrease, reported an average realisation price of USD80.2/ton in H1 2011 as compared to USD84.5/ ton in H1 2010. On a quarterly basis, cement prices in Kuwait increased 1 per cent in 2Q- 2011, Kuwait continue to sell at highest average cement prices as compared to other GCC countries. With the KWD37bn development plan, cement prices should witness an increase as demand is expected to increase throughout the period. UAE realization prices decreased from USD53.1/tonne in H1 2010 to USD50.4/tonne in H1 2011. Excess supply from new local UAE companies dampens cement prices. In addition slow real estate activity and slow construction market have halted the cement market growth in UAE. As of yearend 2010, 49.5 per October-December 2011 DOSSIER
cent of the project market is on hold. UAE continue to face pressure on its cement industry which is proved by declining sales, demand, profits and higher inventories. Qatar cement prices are expected to increase as demand is expected to reach 4.8mn tonnes per annum during the period 2010-2017. While the government continues to cap cement prices at USD68.7/ton. Oman, the country which started to feel a pinch of the crisis by posting lower margins for H1 2011 and registering a huge 14.4 per cent decrease in cement prices in H1 2011, the largest decline among other GCC peers. Omani companies are pressured by UAE cement companies which supply cement at cost to Oman, thus hurting margins of Omani companies and igniting price wars among them. However, the largest cement producer in the GCC, KSA, witnessed an increase in cement prices by 8.2 per cent in H1 2011 to reach USD62.5/ ton, the highest average realisation price since 1H09. The reason KSA is enjoying a low realization prices for cement is due to the fact that KSA has abundant natural resources to help produce cement at low prices 56 DOSSIER October-December 2011
including limestone, oil and natural gas. In addition to the natural gas subsidies that cement companies receive from Aramco. Also, on March 18, 2011 King Abdulla bin Abdulaziz ordered to construct 500,000 housing units, and build and expand hospitals and ordered to inject capital into specialised credit institutions to facilitate debt write-offs and increase mortgage lending. This will help shore up demand for cement as more housing units are in demand. SAUDI ARABIA Cement demand continued to grow strongly with an increase of 12.7 per cent YoY in 2Q11 to 13.6mn tons reflecting the increasing pace of construction activity. This follows a 7.6 per cent YoY growth in cement dispatches in 1Q11. We expect YoY growth trend to continue as start of new construction projects continue to translate into more cement demand. Cement demand outlook has improved with the announcement of the 21 Royal orders. However, on a QoQ basis we expect cement demand to cool off in H2 2011 largely due to seasonal factors with the Haj and Ramadan season falling in this period. Most of the increase in total cement demand in 2Q11 has been accounted
for by cement players in the Western and Central region indicating the strong cement demand in those regions where major urban centers of Jeddah, Madina, Makkah and Riyad are located. Yamama, Arabian, Yanbu and Riyad cement together accounted for 62.5 per cent of total cement demand growth in 2Q11. Among the listed companies, Yamama Cement was the major beneficiary absorbing 22.4 per cent of total volume growth in 2Q11. This came about as dispatches from Najran and Madina Cement, which are both present in the Central region, cooled off. Since 2008, Najran, Madina and Riyad cement have accounted for bulk of the volume growth. However, as they are operating at high capacity levels it has given space to players such as Yanbu and Yamama cement in the Central region to capitalize on excess demand. As we anticipated average realization prices showed a further increase by 7.3 per cent YoY in 2Q11 to SAR245.9 per ton. This follows a 1.7 per cent YoY rise in 1Q11. 2011 has seen an improvement in realization prices after a decline in 2010. Strong domestic demand is mitigating the impact of cement export ban and increase in domestic cement
capacity. We believe the recently announced restrictions on cement export licenses will have a limited impact as cement exports accounted for only 4.6 per cent of total cement dispatches in H1 2011. OMAN Net income for Omani cement companies for H1 2011 was USD38.7mn (OMR14.9mn) while the same during H1 2010 was USD82.9mn (OMR31.9mn), decline of 53.3 per cent. Reason for the decline in the bottom line was because of more than 37.2 per cent increase in the cost and a huge increase in financial charges. Sales revenue of the sector in H1 2011 witnessed an increase of 5.3 per cent to USD177.3mn as compared to USD168.3mn during the corresponding period of last year. Reason for the higher sales during the current period is due to addition of Pioneer Cement numbers to the total this time which were not there in the comparable period. Out of the two, Raysut Cementâ€™s topline grew by 20.7 per cent while that of Oman Cement reported a drop of 13.9 per cent. Both the companies combined were able to roll out 2.93mn tons of cement and clinker in H1 2011 as compared to 2.23mn tons in H1 2010, increase of 30.9 per cent. Cement sales increased by 33.2 per cent to 2.64mn tonnes while sales of clinker rose by 13.0 per cent to 287.6ktons. Sales of Oman Cement went up by 2.7 per cent while that of Raysut Cement went up by 50.5 per cent (cement sales up by 59.5 per cent & clinker sales up by 13.0 per cent) mainly because of inclusion of Pioneer Cement sales. Cement price in Oman declined when compared to their average prices in the same period last year. In H1 2011 average cement prices were USD65.3/ ton (OMR25.1/tonne) as compared to an average price of USD76.2/ton (OMR29.4/tonne) during H1 2010. 58 DOSSIER October-December 2011
Decline in prices mainly resulted because of dumping of low priced cement from UAE. Overall gross margins of the sector witnessed a decline as high cost product of Pioneer Cement depressed the overall margins. Gross margins went down to 38.2 per cent in H1 2011 as compared to 52.5 per cent in H1 2010. Non-core income portion contribution to the bottom line declined during H1 2011. Its percentage contribution to the net income of the sector was 1.8 per cent in H1 2011 as compared to 26.7 per cent in H1 2010.
2011 declined by 56.1 per cent to USD19.4mn as compared to USD44.2mn in H1 2010. Out of the total nine listed cement companies, six of them were in losses totalling AED34.0mn (USD124.8mn). While on a QoQ basis the 2Q11 results were higher by 86 per cent when compared to that of 1Q11. Overall UAE cement sector consolidated revenues went down by 2.9 per cent on a YoY basis to USD464.2mn while 2Q11 revenue was also down QoQ by 6.3 per cent to USD224.5mn. Reason for the decline in the revenue was because of low
Sales revenue of the sector in H1 2011 witnessed an increase of 5.3 per cent to USD177.3mn as compared to USD168.3mn during the corresponding period of last year. Overall sector debt rose to USD226.2mn (23.8 per cent of the assets) in H1 2011 as compared to USD25.1mn (3.5 per cent of assets) in H1 2010.
demand in the country along with lesser export opportunities regionally as other countries are also reaching self sufficiency levels.
On the whole the country is witnessing an increase in cement demand thanks to the projects being carried out post the revolution. This can be ascertained by looking at the sales volume numbers of the listed companies. However, export of low priced cement from UAE is causing a huge trouble for the locals as the sectorâ€™s net margins are at their historic low. During H1 2011, the sector reported net margins of 21.9 per cent.
Cement prices in UAE further went down by 5.1 per cent to USD50.4/ tonne (AED185.0/ton) in H1 2011 as compared to an average price of USD53.1/tonne (AED195/tonne) in H1 2010. Recently the players gathered to stop further decline in the prices which materialised during 1Q11, however, further decline in demand shook the companies which continued to shed off their produce below their cost.
UNITED ARAB EMIRATES Consolidated net income of listed cement companies in UAE for H1
Gross margins of the sector continued to deteriorate and reached historic lows of 7.1 per cent in H1
2011. While 2Q11 margins were even lower than that of 1Q11 at 6.4 per cent. Debt levels of the sector declined to USD529.7mn in H1 2011 as compared to USD576.1mn in H1 2010. Debt as percentage of assets decreased to 14.5 per cent earlier being 15.6 per cent in H1 2010. Unlike other countries, UAE witnessed an equity wipe out as well as the overall equity balance of the sector went down by 1.8 per cent YoY to USD2.78bn as compared to USD2.83bn in H1 2010. Equity as percentage of assets dropped to 76.3 per cent in H1 2011 as compared to 77.0 per cent in H1 2010. Major reasons for the drop in the equity of the sector are the losses reported by sector on their investment in equities and real estate market. The sector was operationally in losses of USD6.9mn, however, contribution from non-core income portion added handsomely to the bottom-line. The contribution touched 123.6 per cent during H1 2011 as compared to 71.5 per cent in H1 2010. QATAR Qatar witnessed a drop in bottom line by 14.5 per cent mainly because of 5.0 per cent drop in the topline. Out of the two listed cement companies, Al Khalij Holding out performed with a bottom line growth of 2.4 per cent while Qatar National Cement reported a drop of 16.6 per cent during H1 2011. Consolidated profits of the sector for H1 2011 were USD67.7mn (QAR246.7mn) as compared to USD79.2mn (QAR288.4mn) in H1 2010. The sector reported profit of USD31.9mn during 2Q11 which was down on a QoQ basis by 11.0 per cent. Consolidated revenues of the sector declined by 5.0 per cent to USD171.7mn during H1 2011 as 60 DOSSIER October-December 2011
compared to USD180.8mn in H1 2010. Reason for the decline in revenue was because of decline in cement sales volume as well as slight fall in cement prices. The decline was somehow arrested by Al Khalij Holding whose sales witnessed an increase of 44.9 per cent. Cement price in Qatar have remained mostly constant since the last couple of years. In H1 2011, average cement prices in Qatar remained around same at USD68.7/tonne. We believe cement prices to remain flat in Qatar because of lesser local players and government control over prices. Non-core income segment continued to add to the bottom line but it was significantly lesser than the contribution in the same period last year. Contribution during H1 2011 was USD11.8mn (17.5 per cent of total income) as compared to USD18.1mn (22.8 per cent of total income) in H1 2010. Debt levels of the sector increased by 6.5 per cent to USD312mn in H1 2011 as compared to USD293.1mn in H1 2010. However, the amount was significantly lesser than that of
1Q11 at USD472.6mn. Assets of the sector increased by 4.4 per cent to USD1.48bn in H1 2011 as compared to USD1.42bn in H1 2010. With the companies under our coverage, Qatar National Cement Company announced that it is going to increase it cement capacity by 0.93mtpa to 5.36mtpa owing to expectation of increase in demand in the coming years. Estimates of the demand for 2012 provided by government authorities to the Company are higher than current demand of 3.5-4.0mtpa. Global Research estimates of average demand in Qatar during 2012-17 is estimated at 4.8mtpa. The Company has not yet given go head to any of the equipment supplier or contractor for the new mill but once assigned it would not take more than 1518months to raise the capacity to desired levels. Company also announced another special mill for grinding slag, which is used in the production of blended cement. Earlier, company announced its second quarter results. Source: â€˜GCC Cement Reportâ€™ by Global Investment House
INDEX TO HOST CONTEMPORARY MAJLIS COMPETITION FOR 21 YEARS INDEX HAS PROVIDED A BUSINESS AND NETWORKING OPPORTUNITY FOR BUYERS AND SELLERS OF INTERIORS PRODUCTS AND SERVICES FROM AROUND THE WORLD TO SOURCE AN ASTOUNDING ARRAY OF THE VERY LATEST DESIGN INNOVATION, TRENDS AND TECHNIQUES
62 DOSSIER October-December 2011
he Contemporary Majlis Competition will run for the third consecutive time at this year’s INDEX Exhibition, the Middle East and North Africa’s largest and longest established Interiors and Design Exhibition, from October 22-25, 2011. This year’s competition will feature six leading Middle East interior designers who will be tasked with designing a contemporary Majlis, showcasing their vision of the traditional Arabic space with a modern cutting edge and innovative design. This year’s six finalist designers include Sinmar Al-Said of Internal Line Interior Design, Ghandour El Habre of Khatib & Alami, Mimi Shakshashir of o’de rose, Carrie Das of AHK International, Basak Yuksel of PF Emirates Interiors and Sven Mueller of SVEN M. “The INDEX Contemporary Majlis Competition has come a long way from its inception in 2009, both in style and popularity. The Majlis concept is especially relished by the younger generation who look for an environment that celebrates Arab culture, but at the same time embraces innovation and contemporary style. Through the competition, INDEX has provided an unbiased platform to nurture and bring interior design talent to the limelight making the competition a vital part of the show,” said Paula Al Chami, Event Director for INDEX. INDEX 2011 did a ‘Call for Submission’ for this year’s competition and received an overwhelming 60 plus applications from qualified interior designers and architects in different parts of the world, including the UAE, Saudi Arabia, Bahrain, Qatar, Africa and the US. Six finalists were selected by the jury based on the design layout and
ABOUT INDEX 2011 INDEX 2011 is expanding its market lead this year by featuring over 800 exhibitors spread across 20,000 sqm, representing top international brands from across 49 countries. Taking place across an increased ten halls at the Dubai World Trade Centre, INDEX 2011 will evolve its profile by introducing a brand new line up of six product-specific shows under the INDEX brand including Furnishings, Retail, Kitchen & Bathroom, Lighting, Outdoor Living and Textiles. Running for the 21st consecutive year, the exhibition will also showcase 20 national pavilions, providing product specification by country. The INDEX International Design Exhibition is the largest event for the architecture and design industry in the Middle East. It attracts more than 800 exhibitors from 49 countries, taking place at the Dubai International Conference & Exhibition Centre. For 21 years INDEX has provided a business and networking opportunity for buyers and sellers of interiors products and services from around the world to source an astounding array of the very latest design innovation, trends and techniques. More than an exhibition, the event provides attendees with unrivalled access to information, intelligence, contacts and hands on experience. Experts from around the world engage in the industry’s most topical discussions, finding solutions, facing challenges and seizing opportunities. The show is the gateway to the Middle East and North Africa (MENA) providing both exhibitors and visitors with the opportunity to conduct serious business with like-minded professionals
concept of their Majlis. The jury panel for this year’s competition is formed by Elise Nassour, Head of Studio at the Engineers Office, Robert Reid of the American University of Sharjah, Dariush Zandi of Total Art, Jenny Eagle of Commercial Interior Design Magazine and last year’s competition winner, Rashida Rajkotwalla of Design Work Portfolio. Elise Nassour, Head of Studio at the Engineers Office said, “The Contemporary Majlis Competition is an exciting opportunity to showcase new ideas, where Designers are challenged with the interpretation of the traditional Majlis - the heart of an Arabic home – in a contemporary and modern expression. We are seeking designs that encapsulate the
rich traditions of the Majlis but in a fresh contemporary and innovative approach that doesn’t lose the essence of the Arabic culture. This year’s entries have been outstanding in the diversity of approach and ideas, from the eclectic to the outrageous, and provided a challenge for us Jurors to select the six finalists. We believe the six finalists will provide an excellent demonstration of design vision and experimentation, which combines past and present elements and provides a platform for future design directions for the Majlis.” Once the jury panel visits the finalist’s showcases live at this year’s show, the winner will be announced on October 22 at INDEX at the Dubai World Trade Centre. October-December 2011 DOSSIER
TABANLIOGLU ARCHITECTS NOMINATED FOR CITYSCAPE AWARDS
THE RECIPIENTS OF THE 2010 CITYSCAPE AWARDS FOR ‘ARCHITECTURE IN EMERGING MARKETS’ RETURN TO DUBAI SWEEPING MORE ACCLAIM AND INTERNATIONAL RECOGNITION
abanlıoglu Architects, the award winning Turkish House of Architecture and Design, renowned for creating remarkably outstanding designs and execution return dynamically in this year’s Cityscape Dubai 2011. Partners Murat and Melkan Tabanlıoglu are invited to be on the speakers’ panel at the World Architecture Congress, on September 27th and 28th, where industry leaders talk about the current challenges in the field of architecture, new standards in international best practice, and the latest innovative strategies for applying modern sustainable design techniques. More in particular, the partners will be speaking about: “Best practices in international urban regeneration” and the creation of modern iconic landmarks: “Seizing opportunities
64 DOSSIER October-December 2011
in the growing Istanbul landscape”. For the 2011 Cityscape Awards for Architecture in the Emerging Markets the architects have been shortlisted in two categories: ¿ Commercial/Mixed Use Built Award category for the Asmacati Shopping and Meeting Point in Izmir, Turkey ¿ Community Built Award category for the Sipopo Congress Center in Malabo, Equatorial Guinea Loft Gardens in Istanbul, Turkey, designed by the renowned Turkish House of Architecture, was also one of the 13 star-studded cast of breathtaking buildings such as Masdar Institute by Foster & Partner’s to Guangzhou Opera House by Zaha Hadid’s to receive an award by RIBA (Royal Academy of British Architects). The announcement that Tabanlioglu will receive the International Awards
2011, for architectural excellence for Loft Gardens came last May, rewarding their unabashed passion for the aesthetic of the industrial loft with their exposed services and structure and with their use of concrete, steel and timber. After Cityscape, the team of Architects will head to UK to receive the award. “The 21 storey residential building situated in Istanbul comprises of high-rise garden patios inserted into the façade as a counterpoint to the protruding bay windows to deepen the play of solid and void within the façade. The plan and section are organized to create a range of apartment types of great spatial variety, some horizontal based around patios, others vertical around doubleheight spaces. The Loft Gardens are an extreme demonstration of elegance and restraint within a subtly modified typology” the jury said.
Tabanlioglu Architects were also recognized by the Asia-Pacific Property Awards for the Best Public Service Architecture for the Astana Arena in May 2011. Intending to be a symbol of the burgeoning new capital of Kazakhstan, the Astana Arena has a spectacular elliptical form and a retractable roof that can be closed in harsh winter weather conditions to protect the players, the spectators and the playing surface. Two deep steel trusses run in an eastwest direction carrying the main roof structure and also bear the weight of the sliding roof components. When weather conditions deteriorate, the two moving parts are activated and slide over the cantilevered main roof elements, to meet above the center of the bowl. Polycarbonate panels in the retractable roof ensure natural light inside, the membrane material resists deformation and have sound absorption. The venue has quickly
About Tabanlioglu Architects In 1990, Architect Murat Tabanlioglu established Tabanlıoglu Architects in collaboration with Dr Hayati Tabanlioglu, in Istanbul. Architect Melkan Gürsel Tabanlioglu joined the group in 1995. Ozdem Gürsel is the third partner responsible of the management of the company consisting of 100 personnel, operating predominantly in Turkey. With more then 50 years of experience, Tabanlioglu works comprise a wide range of building types including innovative mix-use projects. Searching for new efficiencies in terms of global and environmental needs and developments, Tabanlioglu has been awarded several international and national prizes; the company ranks 79th in “BD World Architecture” top 100 list of year 2009.
become a landmark in the city. During Cityscape Dubai 2010, Tabanlıoglu won the award in the ‘Architecture in the Emerging Market – Community Built Category’ and the ‘International
Property Awards in the Bloomberg/ Arabia Section’ for the Tripoli Congress Center in Libya. Tabanlıoglu Architects are also the recipients of the prestigious International Architecture Award (Public Service) for the Tripoli Congress Center at the International Commercial Property Awards that were held in London, United Kingdom in 2010. Tabanlioglu Architects also won ‘Best Cultural and Public Sector Award of MEA’ for its Tripoli Congress Center in Libya, while the founders, Murat and Melkan Tabanlioglu, jointly won ‘Architect of the Year in the Middle East’. Other ongoing projects of the famous Turkish House of Architecture and Design are: Astana Media Center in Kazakhstan, and Zorlu Levent Office Tower, ESAS HQ, Bodrum International Airport, Tarabya Hotel Renovation, Alacati Resort, Camlica Residence. October-December 2011 DOSSIER