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MINERAL INDUSTRY IN OMAN: IN COUNTRY VALUE

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 MINERAL INDUSTRY IN OMAN: IN COUNTRY VALUE

Sobhi Nasir1 and Khalifa S. Al-Jabri2

1. Earth Sciences Research Centre, Sultan Qaboos University, Oman

e-mail: sobhi@squ.edu.om
2. Department of Civil and Architectural Engineering, PO Box 33, Sultan Qaboos
University, Al-Khod, PC 123, Oman.
e-mail: aljabri@squ.edu.om; kaljabri68@gmail.com

ABSTRACT
Production of mineral fuels plays an essential role in Oman’s economy, and further
development of the country’s metals and industrial mineral resources could significantly
contributes to the national economy. Mining is a very old tradition in Oman dating back to the
third millennium B.C. In 1983 modern mining and exploration began at several sites in Oman.
Over the past 40 years different local and international exploration and mapping teams as well as
researchers have contributed to the establishment of a mineral inventory of Oman, and have
contributed greatly to the understanding of the mineralogical and metallogenic evolution. The
future strength of Oman’s economy will be influenced to a large extent by the development of its
natural resources. Many kinds of mineral deposits are known so far in Oman, which can
contribute to the economy of Oman and create many employment opportunities. Current
development of the mineral industry is strongly supported by Government policies to acquire
detailed geological data through continuous mapping programs and by the continuous reviews of
Oman’s deposits of metallic and industrial minerals. The Public Authority of Mining in Oman
started to build a huge geological database which can be used by the investors. A better
geological understanding of Oman’s mineral deposits is now possible due to the numerous
studies, explorations and reviews that have been undertaken over the past thirty years.
The mining sector increased in value by 8% in 2014 and nearly 11% in 2015. Mining and
quarrying contributed OR125million to nominal GDP in 2014, 0.4% of the total. Notable
increases in Oman’s mineral production in 2013 compared with that of 2012 included that of
gypsum, by 45%; chromite and manganese, 31% each; clay, 14%; and marble, 8%. Notable
decreases in mineral output in 2013 compared with that of 2012 included that of copper mine
output, by 45%; quartz, 44%; copper metal content, 50%; laterite, 19%; kaolin, 18%; limestone,
15%; refinery products, 8%; and sulfur, 14%. More than 150 quarrying and mining operations
are going on for fill material. Notable increases in mineral production in 2010-2016 included an
increase in gypsum output by 56%; limestone, by 31%; and cement, by 12% . The mineral
industry of Oman is expected to continue to grow in the next years. ICV aims at enhancing the
value of minerals, services, and skills in the mining sector and stimulating local production and
manufacturing in order to increase the exports of minerals and enhance the provision of services
in Oman, thereby improving the skills and capabilities of Omani nationals by increasing their
contribution to the activities of the mining sector.

1.0 INTRODUCTION
In-Country Value (ICV) aims at enhancing the value of goods, services and skills in industrial
sectors and stimulating local production and manufacturing in order to reduce the imports of
goods and enhance the provision of services, thereby reducing dependency on external experts
and improving the skills and capabilities of nationals by increasing their contribution to the
activities of industrial sectors. ICV, which refers to the total spend retained in the country to aid
in job creation, development of human resource capabilities and establishment of industries
locally to stimulate productivity, has been growing in importance in Oman, particularly in the oil
and gas and mining sectors (Ministry of Oil and Gas 2014). In a mid-sized, open economy in
which the biggest driver of growth so far has been oil, managing the transition to a more
diversified economy is challenging. Fortunately, Oman's government has taken a number of
steps in terms of efficient economic planning and implementation of various social development
initiatives that have contributed to the success of the Omani economy. Other factors that have
contributed to Oman’s success include the significant rise of foreign investment in many sectors
as a result of competitively low tax rates in the region. The development of small and medium
Enterprises together with ICV strategy lays a solid foundation for self-reliant industry and
modernization of the economy. Despite the various challenges within the region and in the
country, Oman’s economy is set on the right path of sustainable growth, development,
diversification and progress.

2.0 OMAN MINING SECTOR: OVERVIEW

The geological resources are indispensable for the development of any nation, as far as the
exploitation of the geological resources is economically interesting. Local materials are natural
resources that can be used with little or no imported entrants for industry. In this category,
industrial minerals are essential for economic development, improvement of infrastructures and
growth of the economic sector. The Omani economy continued to be highly dependent on
hydrocarbon revenues. Therefore, the Government has been working on diversifying its
economy to reduce dependence on hydrocarbon revenue by developing the country’s industrial
sector. The future strength of Oman’s economy will be influenced to a large extent by the
development of its natural resources. Oman’s wealth and future are directly related to the rocks
on the surface and at depth. These rocks give host to deposits of industrial minerals and form
the reservoirs for oil and gas. Production of mineral fuels plays an essential role in Oman’s
economy, and further development of the country’s metals and industrial mineral resources could
significantly contributes to the national economy. In 1983 modern mining and exploration
began at several sites in Oman. Although mining activity had been ongoing in Oman since the
Bronze Age more than 4,000 years ago, the country’s mineral resources are still relatively
untapped, and vast resources of metals and industrial minerals are present. Over the past 30
years different local and international exploration and mapping teams as well as researchers have
contributed to the establishment of a mineral inventory of Oman, and have contributed greatly to
the understanding of the mineralogical and metallogenic evolution. Many kinds of mineral
deposits are known so far in Oman (Table 1). The greatest mineral potential in Oman exists
mainly within the Semail ophiolite where significant chromite, Mn-oxide, Ni-Fe-laterite, base
metal and precious metal mineralization are present. Mineral potential also exists in the
Hawasina and Sumeini nappes (Mn-, Cu-, Pb and Ba-mineralization), the autochthonous
sedimentary rocks (Coal beds, fluorspar, clay, barites and celestite), sedimentary basement (Pb,
Zn, Ag, and heavy minerals) and the crystalline basement (Phosphate, iron, Mn- and U-
mineralization). There is a great potential for the mineral based industry in Oman, which
possesses significant potential of industry rocks including limestone, dolomite, marble, granite,
gabbro, gypsum, wollastonite, guano, olivine, and rock salt. Presently, main industries based on
industrial rocks and minerals are in the construction sector. Basic raw materials such as
limestone, dolomite, gypsum, salt, silica, clay, shale, gabbro, basalt, olivine, serpentine and semi-
precious stones are available in Oman in commercial quantities, but the industries based on them
are mostly lacking. These raw materials can be used for various industrial uses such as glass,
ceramic, chemical, fertilizer, agriculture, soda ash, magnesia, abrasive, filler, fluxes, refractory,
rock-wool, basalt fibers and insulation products. These industries will contribute to the economy
of Oman and will create many employment opportunities. Current development of the mineral
industry is strongly supported by Government policies to acquire detailed geological data
through continuous mapping programs and by the continuous reviews of Oman’s deposits of
metallic and industrial minerals. The Directorate General of Minerals, Ministry of Commerce
and Industry, started to build a huge geological database which can be used by the investors. A
better geological understanding of Oman’s mineral deposits is now possible due to the numerous
studies, explorations and reviews that have been undertaken over the past thirty years (The
Public Authority for Mining 2015). The Ministry of Oil and Gas publsihed the first report on
the geology and minerals of Oman in 1985. The Omani government declared 1991 as the year of
industry and contracted several geological survey institution to evaluate and promote
development of the mineral industry sectors of Oman (e.g., Basquet, 1995; Le Metour, et al.
1995). Qidawi, (2004) summarised the development possibilities of Industrial Rocks and
Minerals in Oman. In 2011, the Government contracted the environmental engineering
consulting company Brenk Systemplanung GmbH of Germany to evaluate Oman’s growing
mineral sector, which conducted a comprehensive review to introduce best practices in the
development and marketing of Oman’s mineral resources and to counsel on ways to improve and
update guidelines and regulations for the mineral industry (Ministry of Commerce and Industry,
2014).
 Table 1. Production of mineral in Oman (Thousand metric tons unless otherwise specified)

Cu- Manganese Crude

Laterite
Year Chromite smelter Cu refinery Aluminum Metric ton steel
1999 28,684 24,400 22,700 0 0 0
2000 26,004 16,818 17,171 0 0 0
2001 15,110 23,790 24,281 0 0 0
2002 30,150 24,220 24,000 0 0 0
0 0 0
2003 27,444 24,000 24,000
0 0 0
2004 13,800 18,000 17,000 84,000
2005 26,600 16,000 15,090 0 0 84,000 0
2006 50,400 25,000 24,543 0 0 84,000 1,740,416
2007 276,300 20,710 20,710 0 0 84,000 271,200
2008 407,822 14,000 13,940 0 0 84,000 295,012
2009 784,082 12,000 11,906 49,000 0 84,000 301,117
2010 636,482 16,000 15,090 351,000 0 84,000 366,797
2011 801,856 16,000 15,000 367,000 0 84,000 334,769
2012 616,625 111,408 15,000 367,000 41,300 160,000 721,620
2013 602,225 12,000 16,000 373,000 37,500 160,000 709,685
2014 787,645 12,000 16,000 360000 49,000 160,000 572,378
2015 800,000 12,000 16,000 354,000 49,000 160,000 572,000
2015 800,000 12,000 16,000 354,000 49,000 160,000 572,000
 Table 1. Production of mineral in Oman (continued)

hydrocement limestone gypsum marble

1999 1,333,000 0 189,507 115,748
2000 1,217,000 0 180,129 188,545
2001 1,238,063 0 131,909 147,686
2002 1,369,570 0 44,323 157,249
55,722
2003 1,700,000 0 135,930
181,900 146,600
2004 2,515,000 0
103,000 163,800
2005 2,621,000 0
2006 2,686,000 2,502,794 133,100 220,900
2007 3,611,000 2,732,600 254,000 270,800
2008 3,880,000 3,098,300 183,000 311,861
2009 4,000,000 2,391,500 179,800 457,146
2010 4,000,000 7,947,606 333,414 587,892
2011 4,500,000 4,389,096 395,462 507,738
2012 5,000,000 4,995,262 1,254,051 931,409
2013 4,569,352 6,488,038 1,915,300 1,165,410
2014 4,569,352 5,489,018 2,785,133 1,255,307
2015 4,569,352 5,489,018 2,785,133 1,255,307

The Government policy document “Vision 2020” states that industrial diversification can be
an instrument to achieve the development targets set by the Government. These targets include
increasing the contribution of the non-oil sectors (including the natural gas sector) to 91% of the
GDP and non-oil exports to 13% of the GDP by 2020. The Oman government constantly speaks
of the desire to “diversify the source of revenue generation for the economy away from oil,” and
regularly projects the mining industry as the next best thing outside crude oil. Accordingly,
government has identified mineral production as the gem of the solid minerals industry, and a
sure route to the creation of millions thousands of f jobs and wealth for Oman. The Government
established the Mineral Development of Oman as a public entity in 2008 to encourage
investment in the country’s mineral industry. Takamul had plans to establish two “Mineral
Cities” in Sohar Industrial Estate and in the ShuwaymiyahWadi to serve as the center for
mineral-based downstream industries. Sohar Industrial Port Co. tends to build a mineral export
terminal that would have the capacity to handle from 6 to 10 Mt/yr of aggregates and dry bulk
commodities.
Mining companies saw moderate growth in the last 5 years, and the forecast for 2020 is
strong as global demand for base and precious metals continues to climb. The mining sector
increased in value by 3% in 2010. The production of rocks and minerals shot up to RO 167.73
million in 2011 and RO 173.72 millions in 2010 from RO 24.16 million in 1996 to RO 33.32
million in 2000 (Fig. 1). More than 150 quarrying and mining operations are going on for fill
material. Notable increases in mineral production in 2010-2015 included an increase in gypsum
output by 56%; limestone, by 31%; and cement, by 12% (Figures 2a-c) (Central Bank of Oman,
2015). The mineral industry of Oman is expected to continue to grow in the next years.
However improving safety and reducing the environmental impact will be ongoing goals for the
mining industry.

Mining sector production in Million OR

2000
1800
1600
1400
1200
1000
800
600
400
200
0
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Fig. 1. Growth of the mining sector production in Oman

1200000

1000000

salt
800000
Sulfur:
600000 Silica sand
quartz
400000
Kaolin
200000 clay

0
1998

2003

2008

2013
1999
2000
2001
2002

2004
2005
2006
2007

2009
2010
2011
2012

2014
2015
Fig. 2a. Production of rocks and minerals in Oman.

16,000,000

14,000,000

12,000,000

10,000,000 marble

8,000,000 gypsum
limestone
6,000,000
hydrocement
4,000,000

2,000,000

0
1999 2001 2003 2005 2007 2009 2011 2013 2015

Fig. 2b. Production of rocks and minerals in Oman

 2,500,000

2,000,000
Laterite (iron oxides)
Crude steele
1,500,000
Manganese:

1,000,000 Aluminum
Cu refinary

500,000 Cu-smelter
chromite
0

Fig. 2c. Production of rocks and minerals in Oman

3.0 ASPIRATIONS, GOALS AND ICV STRATEGY IN MINING

SECTOR OF OMAN

Oman is endowed with the world-class mineral, chromite and copper deposits. Therefore,
the management of such deposits should arrive for the greatest benefit of the nation. Oman
Vision 2020 calls for transforming Oman into an economically developed country. According to
government figures, mining and quarrying contributed OR125million to nominal GDP in 2014,
0.4% of the total, with nonferrous metal ores accounting for OR47million (ONA 2016; Mowafa
Taib 2015). In real terms, the sector grew by nearly 11% in 2014 and 8% in 2013 and it appears
to have continued this trend in the first half of 2015, where it was one of the fastest growing
sectors of the economy. The Government of Oman set a target of 10% annual GDP growth in
2010. The target is for the mining and mineral industry to constitute 10% of the GDP by 2020
(Deloitte 2013). Mining was estimated to have constituted 2.47% of the GDP in 2009-2010,
which means to achieve 9% of GDP by 2020, the mining industry will need to grow by 25%
annually. Mining sector will have to grow thrice as fast as the overall economy, which is
growing at 8-9% annually.
The ICV in mining sector is aimed at retaining the total spend from the mining sector
within Oman which will boost the economy through enhanced employability of Omanis and
establishment of robust repair and servicing industries for the mining sector in Oman. This will
require implementing the new ICV terms and conditions in all projects and enhanced the
developments of small and medium enterprises and diagnose their specific needs will
increase their market share and create new jobs for Omani. This will include providing
solutions to Mining sectors, including training and services. There is a need for a National
Strategy for Oman’s Mineral Industry. Such a strategy is expected to align actions with goals
and aspirations, identification of the highest priorities, and coordination across multiple
stakeholders and governments.

4.0 CONCLUSION

Over the past two decades Oman has made tremendous strides economically, but needs to do
more at an increased pace to achieve growth targets . The mining sector in Oman needs to adapt
global policy practices and technologies for rapid growth from exploration to exploitation to
rehabilitation It will benefit from having a strategy and an action plan that capitalizes on
competitive assets and addresses barriers to competitiveness. ICV strategy includes professional
development and job creation for Omanis, supporting the mining sectors requiring the product
and services provided by the Omani companies. Not only have Mineral resources to be
considered as the source of national income, but also as national asset to boost National
economic growth. Implementation of sustainable mining can be translated by conducting a good
mining practices with emphasizes to carry out an environmentally sound mine operation.
Mineral beneficiation is an effort to improve the sustainable use of mineral resources. The
mining sector needs to lower barriers in starting mining business, especially in the simplification
of license procedures and process, develop human resources through training and education,
increasing tax incentives and engage financial institution and stock exchange to provide
favorable financial scheme.

REFERENCES
Central Bank of Oman, 2014, Annual report 2013: Ruwi, Oman, Central Bank of Oman, 152 p.
(Accessed July 15, 2014, at http://www.cbo-oman.org.)
Deloitte 2013 A Middle East Point of View, Oman 20/20 vision, Ministry of Commerce and
Industry, 2014, Laws and regulations—The mining law no. 27/2003: Ministry of Commerce and
 Industry Web page. (Accessed July 25, 2014, at http://www.mocioman.gov.om/Main-
Menu/Laws-and-Regulations.aspx.).
Le Metour, J et al (1995) : Geology and Mineral Wealth of the Sultanate of Oman

Ministry of Petroleum and Minerals, Geological Documents Series.

Ministry of Oil and Gas, Statistical information: Ministry of Oil and Gas Web page. (Accessed
July 25, 2014, at http://www.mog.gov.om/english/tabid/90/Default.aspx.)

Mowafa Taib 2015. The Mineral Industry of Oman. Minerals Yearbook U.S. Geological Survey
ONA 2016. Oman's mineral production exceeded OMR142 million in 2014. February 6,
www.timesofoman.com.
Qidawi, H.A. (2004) : Industrial Rocks and Minerals in the Sultanate of Oman : Development
possibilities. Al Roya Publishing, Muscat 2004
Pasquwt, J.F. (1995) : Industrial Rocks and Mineral Deposits in the Sultanate of Oman. M.P.M.
Geological Documents, Ministry of Petroleum and Minerals
The Public Authority for Mining 2015. Mining Opportunities in Oman

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