Muscat – Brazilian mining giant Vale has signed a land reservation agreement with the Port of Duqm Company and a memorandum of understanding (MoU) with Marafiq to develop an integrated industrial complex (Mega Hub) to produce low-carbon products for the steelmaking industry in the Special Economic Zone at Duqm (SEZAD).

The signing ceremony took place at the Invest Oman Hall, in the presence of H E Ahmed bin Hassan al Dheeb, Vice President of the Public Authority for Special Economic Zones and Free Zones (OPAZ), H E Dr Mansoor bin Talib al Hinai, Chairman of the Authority for Public Services Regulation, and H E Ibtisam bint Ahmed al Farooji, Undersecretary of the Ministry of Commerce, Industry and Investment Promotion, for Investment Promotion.

Signed by Eduardo Bartolomeo, Vale’s CEO, and Reggy Vermeulen, Port of Duqm Company’s CEO, the land reservation agreement between Vale and the Port of Duqm also commissions joint studies to build a Mega Hub in Oman.

Additionally, an MoU was signed by Bartolomeo and Abdullah al Hashmi, Managing Director of Marafiq, a leading utilities service provider in the Special Economic Zone at Duqm. The MoU aims to provide the project with access to all the utilities and services required for its operations, while promoting the use of clean energy and green hydrogen at the Port of Duqm.

The stakeholders have proposed the use of clean energy and green hydrogen in the upcoming Mega Hub. The planned industrial complex will cover an estimated total area of 6.78 sqkm and produce hot briquetted iron (HBI) and other steel products.

“The signing of these agreements marks a significant milestone in establishing Vale as a leader in sustainable mining,” Bartolomeo said. “We are thrilled about the prospects the planned Mega Hub presents in supporting the steel industry’s drive towards greener operations. The Port of Duqm, a growing key industrial hub in Oman, is perfectly positioned to support our expansion plans, and we are excited to demonstrate the potential of Oman and Duqm as an attractive proposition for foreign direct investment.”

The Port of Duqm’s Vermeulen said, “We are pleased that Vale, a world-renowned mining company, chose to establish its Mega Hub in the Port of Duqm. The strategic location of our port on key international trade routes, its proximity to large regional markets including India, Africa, and GCC countries, and its world-class infrastructure make it an ideal location to establish such major industrial projects.”

“The Port of Duqm is also set to be a future hub for green hydrogen and its derivatives,” Vermeulen said. “We are optimistic that it will quickly emerge as a destination of choice for green steel manufacturing and are proud to call ourselves the ‘green port’. We are committed to supporting the national goals of Oman, including de-carbonisation, commitment to net-zero, and realising the sustainable development goals laid out in Oman Vision 2040.”

Marafiq’s Hashimi said that Marafiq is keen to sign this MoU with Vale and provide the project with vital utility services, including power. Hashimi also highlighted the importance of Vale’s Mega Hub plans in the Special Economic Zone at Duqm and said the company will fully support the project, which in turn promotes Marafiq’s growth.

The Mega Hub initiative contributes to Vale’s commitment to reduce 15 per cent of net Scope 3 emissions by 2035. Additionally, Vale seeks to reduce its Scope 1 and 2 emissions by 33 per cent by 2030 and achieve net-zero by 2050, in line with the Paris Climate Agreement, leading the evolution towards sustainable mining.

The development of Vale’s Mega Hub project is expected to produce HBI and steel products to supply both the local and export markets while significantly reducing CO2 emissions. The production of HBI using natural gas emits around 60 per cent less CO2 when compared to more traditional methods. In the future, the replacement of natural gas with hydrogen and the usage of renewable energy could eliminate CO2 emissions.

Vale is expected to build and operate iron-ore concentration and briquetting plants within the hubs, securing the supply of high-grade agglomerated products. Local parties are expected to promote the construction of the required logistics infrastructure. Investors and/or clients are expected to construct and operate the direct reduction plants and be off-takers of HBI for either the export or domestic markets. These Mega Hubs shall supply different markets across the globe, supporting the de-carbonisation of the steelmaking industry.