Oman increases investment in crypto mining sector

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According to recent reports, Oman has increased investment in the crypto mining sector. It recently opened a new data hosting and crypto mining facility in the Salalah Free Zone and announced the construction of a second center.

The Ministry of Transport, Communications and Information Technology MTCIT launched the first crypto mining facility, estimated to be worth over RO135 million (more than $350 million) last week. The project was announced in November last year.

The first facility has around 11 MW capacity across 312,000 square meters (3.36 million square feet). It has begun operation and powered more than 2,000 mining machines. The number is expected to expand with 15,000 additional machines by October.

Exahertz International, a subsidiary of Afaaq for Advanced Technologies, is responsible for establishing the new mining facilities.

Exahertz CEO Sam Verdous suggested that the Sultanate of Oman could see a wider network of blockchain-based centers in the near future. The Salalah Free Zone pilot project will be followed by trials at other regions, such as Al Jabal Al Akhdar and Al Dakhiliyah.

The pilot facility will not be the first data center project in Salalah, as it has been home to projects from Ooredo and Equinix. Ooredoo is a Qatari telecommunications company that began constructing its Omani facility in August 2022. It is set to host the 2Africa subsea cable.

According to Verdous, the mining facilities use hardware from Bitmain Technologies, a Chinese crypto mining provider. At the same time, the centers will be utilizing local infrastructure, including electricity and personnel.

The cryptocurrency mining centers could significantly impact the local digital economy, creating numerous job opportunities for Omanis and positioning the country as a global data hosting and mining hub. Exahertz also plans to offer internship programs to young people.

Minister of Transport, Communications and Information Technology Eng. Saeed bin Hamoud bin Saeed Al Mawali said the centers will “help to accelerate the growth of the country’s digital economy and create new opportunities for Omanis.” This “major milestone” in the country’s digital transformation journey helped the Sultanate of Oman to place among the ranks of developed countries in this industry.

Changing landscape

The cryptocurrency mining industry has been the subject of much discussion in recent months. China was a leader in the crypto mining sector until 2021, when Beijing banned the practice. Since then, miners have been forced to relocate to more friendly jurisdictions.

Thailand saw a surge in crypto mining activities following China’s ban. However, the sector is contested in Thailand as there is a spike in illegal mining activities across the country.

Kyrgyzstan is the next developing country to establish its own cryptocurrency mining facilities. President Sadyr Japarov has approved the construction of a $20 million mining facility near the Kambar-Ata-2 Hydropower Plant, which is located near the country’s largest river, the Naryn.

The mining facility will use the excess energy from the station. The hydropower plant generates 120 MW of electricity annually but can only use 90 MW. The remaining 30 MW of energy is currently unused, costing the plant over $37 million in lost revenue.

However, Japarov also noted that the crypto mining facility might have to suspend operations during the winter. This is during the time when the hydropower plant’s output is not that high. Authorities assure that they will closely monitor the mine’s activities. Should the process harm the state, they will take measures.