The Omani government has decided to float a 100 per cent owned company to promote the Salalah Free Zone (SFZ) project.

"The Omani government will hold 100 per cent equity in the company to promote SFZ," Jack Helton, chief executive of Salalah Port Services (SPS).

"With the government holding 100 per cent equity, it would be a quick implementation of the project."

He added that at a later stage, SPS could join the project.

At the moment, he pointed out, his company would fully cooperate with the government in the implementation of the project.

"They (the government) can do it quickly and it is important to do it quickly." Thus, he feels that SFZ will help accelerate economic growth in the southern region of the company.

The SFZ project has remained a non-starter since the Omani Government, SPS and U.S.-based Hillwood signed a memorandum of understanding in 2000.

The first phase was estimated to have cost $90 million at that time.

The government was to hold 60 per cent and 20 per cent each by the Salalah Port Services and Hillwood.

After two years, in July last, Hillwood pulled out of the project.

The official reason given was that Hillwood pulled out due to the war clouds over Iraq and potential conflict between India and Pakistan at that time.

At that time, the Omani Government vehemently denied reports that Hillwood pulled out due to bureaucratic delays.

Helton said he was not in a position to confirm any other details but it reliably learnt that the government is talking to Liverpool-based Portia and Singapore's Ascendas for joining the project as the development managers.

SPS posted an estimated net profit of $2.4 million last year. Final figures are yet to be officially released by SPS.

Prudent cost cutting was a factor in yielding higher net profit this year.