Omani Government to End Maersk-Linked Concession in Salalah Port
The Omani government says that it will not extend the current Salalah port concession to a Maersk-linked operator beyond the current lease expiration date in November 2028.
Following a series of negotiations, Salalah Port Services Company (SAOG) has announced that it has received a notification from the Ministry of Transport, Communications and Information Technology (MTCIT), confirming the end of the concession.
Further, the notification indicated that the decision is final and unconditional. MTCIT emphasized that normal port operations will continue uninterrupted for the remaining period. The government is expected to announce a new operator in due course.
SAOG is led by APM Terminals, part of A.P Moller-Maersk Group, which holds a 30% stake. The Omani government through the national logistics company Asyad Group holds 20%.
SAOG was granted 30-year concessions to run the Container and General Cargo Terminals back in 1998. The company also signed separate management agreements with APM Terminals for technical and operational support for the duration of the concessions.
While the SAOG board is reviewing the impact of the decision on its business, the company said that it was hoping for an extension based on its track record. In the first quarter of 2025, the company completed a $300 million container terminal upgrade. This included improvements to all six existing berths, a new access road, expansion of reefer plugs and an upgraded electrical power substation.
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In addition, the upgrade included terminal equipment worth about $200 million: 10 new STS cranes for handling ultra-large vessels,12 hybrid rubber-tyred gantry cranes, two reach stackers and 30 terminal trucks and trailers. At the time, SAOG opted to lease rather than purchase the equipment due to uncertainty of its concession in Salalah port. These upgrades have seen the terminal’s handling capacity rise to 6.5 million TEUs from 4.5 million.
With the decision now not to extend the concession, it is not clear whether the equipment leases will be affected by the operator transition.
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