A final investment decision (FID) on Vale’s proposed low-carbon iron Mega Hub at the Special Economic Zone at Duqm is expected this year, with construction planned to start next year, according to Nasser al Azri, CEO of Vale Oman Pelletizing Company.
Al Azri said the project has advanced through early development and is drawing strong interest from international investors seeking downstream opportunities. Several memoranda of understanding are already in place, he noted, adding that clients have engaged with Omani authorities and further agreements are expected by year-end. Land agreements have been signed at Duqm, signalling firm intent, with first-phase investments estimated at around USD 5 bln alongside partners. In comments to The Energy Year, Al Azri said the first phase is targeted to reach FID in 2026, with completion aimed for 2029.
First announced in November 2022, the Duqm project is one of three Mega Hubs Vale plans in the Middle East. Under a lease with the Port of Duqm, about 6.78 sq km has been allocated. Vale will develop and operate iron ore concentration and briquetting facilities to supply high-quality feedstock, while local partners handle logistics and customers invest in and operate direct-reduction plants to produce hot briquetted iron (HBI) for domestic and export markets.
The Mega Hub aims to cut steelmaking emissions significantly. HBI produced using natural gas emits around 60pct less CO2 than the traditional blast furnace-basic oxygen furnace route, with scope to move toward near-zero emissions over time through hydrogen and renewable energy.
Separately, at Sohar Port and Freezone, Vale is advancing Oman’s first iron ore concentration plant, a USD 600 mln joint venture with ACPG Jinnan Steel. Al Azri said the project will enhance flexibility, diversify ore sourcing, introduce advanced technology, create jobs and strengthen in-country value, which Vale estimates at around USD 1.9 bln.
