Oman to build six new airports as its differentiated tourism offer attracts more visitors
Oman has always presented a different face to the rest of the world compared with some of its neighbours in the Gulf.
It is the only developed country in the region with an Indian Ocean coast, and parts of its own coast are a haven for visitors from India when temperatures get too high there.
It also attracts them by way of a differentiated tourism offer that is based around nature, culture and history across the large country, rather than glamour concentrated in skyscraper dominated cities.
And that may be at least partly why a decision has been taken to build six new regional airports in addition to the two that have opened in the past seven years; one of them on island with nascent tourist potential.
They will probably remain within the orbit of the state airports management company, OAMC. Oman has flirted with foreign private sector management in the past - almost a quarter of a century ago now - but it did not end happily.
But as the size of the organisation grows, along with the managed airspace, there is always the prospect that it might come back under review.
- Oman will build six new regional airports by the end of this decade.
- Two new airports previously opened in the past seven years.
- They will mainly be in thinly populated areas, but one will be on an island with tourist potential.
- Tourism is an important element of the strategy; the Salalah airport already supports unanticipated Indian visitors.
- Additional airspace has also been added as airlines try to avoid more troubled countries.
- The new airports could have a dual military role.
- Of the two main airlines, it is the LCC SalamAir that is more likely to be attracted to the new airports.
- There are no indications of any private sector attraction to the new airports, but in the broader scheme of things that might not always be the case with the national operator
- OAMC issues BOT tender to redevelop and operate Muscat Airport's Old Terminal
Oman to build six new airports by 2029 as throughput of 50mppa forecast by 2040 is revealed
Oman Civil Aviation Authority's chairman Naif bin Ali al Abri said recently that Oman plans to construct six new regional airports that are scheduled to open in 2028/29, increasing the number of airports in the country to 13 as part of its aims to expand domestic travel and inbound tourism.
Passenger numbers are forecast to reach 50 million by 2040 - up from the current figure of 17 million (2023), 14 million of them currently at the two main airports at Muscat, the capital, and Salalah in the south of the country.
Two new airports were already opened in 2017/18
The other airports (there are 23 in total, but only nine of significance) are comparatively small, as the six new ones will be, at least initially.
The major airports in Oman
Some of these existing airports are themselves quite new, such as Sohar (which opened in 2017) and Duqm (2018).
The Musandam airport would be in a thinly populated area where one already exists (but there are potential military overtones)
While the location of all the sites has not yet been confirmed, one will be at Ras Al Musandam, locally known as Ruus Al Jibal, which is an Omani exclave in a multi-governmental area (with the UAE) overlooking the Straits of Hormuz.
The Straits are strategically important, and Ras Al Musandam is only 100km (62 miles) from the Iranian city of Bandar Abbas, which raises the question of co-usage with the military, but no specific mention of that outcome has yet been made.
(Muscat also has a border with the blighted country of Yemen to the south, but has - so far - managed to avoid any entanglement with its affairs).
There is an existing airport close by, at Khasab, in what is a thinly populated zone.
The Musandam airport is expected to be completed in the second half of 2028. It will have a single runway, taxiway and a terminal, together with a service and hangar area suitable for handling aircraft up to the size of the Boeing 737 and Airbus 320.
Other sites are believed to include Masirah, an island off the Omani Indian Ocean coast close to Duqm. It is already the site of a military airfield.
Also (Jabel) Akhdar, which is inland, and approximately 100km to the southwest of Muscat.
Another new airport for Sohar doesn't make sense
Strangely, Sohar has been mentioned as a site, but Sohar, a coastal city on the Gulf of Oman, already has an airport, and has had since Jul-2017.
Sohar Airport was designated as a reliever facility for Muscat Airport, capable of handling large volumes of passenger and cargo services entering the Sultanate. Over 300,000 passengers used it in 2019, but only 45,000 in 2023, itself a 40% reduction on 2022, so expansion can hardly be under consideration.
Plans previously under consideration included the upgrading of some desert airstrips that currently serve oilfields in the country.
The authority has already floated tenders for site selection studies, master plans, design and supervision for the proposed development of Jabal Akhdar and Masirah airports.
Tourism and increasing numbers of visitors is a driving force behind the new airport strategy
One of the driving factors behind the expansion is that Oman regards inbound tourism as a major plank of its economic development.
The country sets itself apart from others in the region by promoting nature over glitz and glamour, and it was voted seventh top country globally as a travel destination for tourism in 2022 by Lonely Planet.
While there are historical and cultural attractions at the capital, Muscat, the tourist authority prefers to focus on spectacular mountains, wind-blown deserts and a pristine coastline; its 'ancient soul' taking precedence over the glitzy attractions of neighbouring territories, while not overlooking its modern face entirely.
Not only that; a prior focus on up-market resort and hotel development has been replaced latterly by one on three-and four-star establishments, which indicates a shift in socio-economic preference towards those with thinner wallets.
Moreover, recent years have witnessed a growing interest in services from Muscat and countries throughout the Gulf to Salalah in southwest Oman, which is on the cusp of the Indian Ocean; the monsoon there brings mist, rain and cooler temperatures in early summer.
This attracts visitors from other Arab nations where temperatures are consistently high, seeking relief from them, although it is not likely to be an attraction for tourists from more temperate climates.
Salalah Airport has grown steadily
And it has at least contributed to steady passenger growth at Salalah Airport, the country's second busiest, where traffic increased steadily year-on-year to a 2017 high of 1.5 million.
In 2023, at 1.46 million, traffic rose back above 2019 levels and continued at +10% in the first four months of 2024.
Salalah International Airport: annual traffic, passenger numbers/growth, 2009-2004 (Jan-Apr)
Indian Ocean airport and basic tourist facilities to offer monsoon-related heat relief, too?
It might be the intention that one of the new proposed airports, on Masirah Island, should benefit from such heat-avoiding tourism. The island is partly developed touristically, with basic facilities attuned to the needs of nature seekers, and where there are "still more turtles than tourists", according to the main tour operator.
These new airport proposals are set within a framework of an anticipated increase in the annual number of air travellers to and from the Middle East to over 500 million in 2025, meaning aviation authorities need to both expand and streamline use of available airspace, as well as the airports.
Almost four million visitors in 2023, and tourism represents 3.5% of GDP
Tourism specifically to Oman rose to 3.5 million visitors in 2019 prior to the COVID-19 pandemic, with revenues of USD3.08 billion, amounting to 3.5% of gross national product.
Oman plans to invest USD31 billion in its tourism sector by 2040 to attract more international visitors. In 2023 the country saw a record-breaking four million visitors - up from 2.9 million in 2022, marking an increase of almost 38%.
Additional airspace has been added as airlines seek to avoid regional trouble spots
Oman has opened two blocks of domestic airspace over the past five years to help ease the traffic burden, according to the CEO of Oman Airports Management Company (OAMC). OAMC is a wholly-owned company of the Government of the Sultanate of Oman, and is also responsible for the management and operations at the two major airports at Muscat and Salalah, together with the regional ones.
Regarded as a "safe" country in a turbulent region, Oman has attracted airlines that prefer to avoid overflying some other countries, according to OAMC, which is why the use of Omani airspace is growing rapidly.
The LCC SalamAir may be attracted to these airports
The new airports will be of interest both to the flag carrier Oman Air, which currently has 38% of the seat capacity (mainly international) throughout the country, and more so to the second largest airline, the LCC SalamAir (24%).
Oman - system seats for all airlines, week commencing 17-Jun-2024
SalamAir, established as a government joint venture in 2017, currently operates 14 Airbus A320/321 aircraft that are suited to a low cost role, but in 2022 the airline placed an order for six Embraer E195-E2s (plus six options) - aircraft which would be well suited for handling what would be thin routes, at least in the first instance.
On the other hand, 'thin routes' have never really suited LCCs unless they can get away with a thin schedule as well. They probably could in this case.
Oman Air has retrenched following expansion in the late 2010s
As for Oman Air, it is in an interesting position; but as the national flag carrier, and while it invested in new long haul routes and is about to join oneworld, and even after a new airport opened in Muscat, it has scaled back on some of its activities since the COVID-19 pandemic. It has become more of a point-to-point airline, although still with a focus on connecting the Middle East with the Indian subcontinent.
None of this has any meaningful impact on the new airports. Oman Air only flies between Muscat and Salalah and Khasab airports domestically. Those airports will have to rely on SalamAir.
Oman Airports has courted privatisation, but will be mindful of the collapse of a previous procedure
OAMC is a state-owned organisation. There has been talk of partial privatisation to 30% of the equity in the past, and even of OAMC being an investor in, and operator of, airports abroad.
Indeed, for a short period in the early 2000s the Muscat and Salalah airports were managed under concession by the UK's BAA plc in a consortium, NewCo, within a troubled 25-year concession transaction that terminated after three years in 2004 with a return to national control.
In early 2020, immediately before the pandemic, the Oman Aviation Group, a non-governmental organisation tasked with being responsible for developing and empowering the aviation sector in the sultanate, said that it was evaluating the privatisation of the Muscat airport, which would "continue to be an option as long as it's to the benefit of the group and it's to the benefit of the country".
On the acquisition side, in Jun-2022 OAMC signed an MoU with Kilimanjaro Airports Development Company in Tanzania to develop facilities at Kilimanjaro Airport, but with no indication of a financial involvement.
No indication right now that internal or external investors would be interested in the new airports
So for now, these six airports will probably be built when their precise locations are known, but OAMC will continue to be concerned mainly with the two principal airports - especially Muscat - and the direction they are taking.
There will not be any substantial interest from external operators/investors at least into any co-operation - operational or financial - until any of the airports have established themselves with significant traffic levels - be it from tourism or any other source.
Internally, the Omani consortium member that worked with BAA in the NewCo consortium to manage Muscat and Salalah airports from 2001 to 2004 was Suhail Bahwan Group - a conglomerate on 15 sectors with royal patronage, and whose philosophy is "enriching the lives of people through enterprising efforts".
If Suhail Bahwan Group does not show a modicum of interest in these new airports, then no-one else is likely to.
BREAKING - 21-Jun-2024 - BOT tender to redevelop and operate Muscat Airport's Old Terminal
OAMC announced an invitation for expressions of interest from lead developers, sub developers, or real estate and investments firms for the redevelopment, operation, and management of Muscat International Airport's 'Old Terminal'. The project will be carried out under a build-operate-transfer (BOT) model. The deadline for submissions is on 09-Jul-2024.