# Khazaen Economic City: Land, Factories & Company Setup in Barka

> Khazaen Economic City is a roughly 52 km² integrated industrial and logistics city in Barka, South Al Batinah, supervised by OPAZ, operated by Asyad's Oman Logistics Company, and home to two free zones.

URL: https://omanregister.com/free-zones/khazaen-economic-city/
Updated: 2026-10-24
Publisher: Oman Register (omanregister.com) — company registration and residency services in Oman. Contact: +968 7733 3556, info@omanregister.com

## At a glance

- **Authority:** OPAZ (supervision); operator Oman Logistics Company (Asyad)
- **Developer:** Khazaen Economic City LLC (public–private partnership)
- **Legal status:** Royal Decree 44/2023, which also created two free zones inside the city
- **Location:** Barka, South Al Batinah, at the Muscat Expressway / Batinah Highway junction
- **Area:** About 51–52 million m² (official statements)
- **Investment:** Over OMR 800 million cumulative (reported Oct 2025)
- **Best for:** Manufacturing, pharma, food, packaging and logistics
- **Nearest port / airport:** Sohar Port about 2 hours; Muscat airport about 30 minutes

Khazaen Economic City is a planned industrial, logistics and mixed-use city of about 52 km² in Barka, South Al Batinah, about 30 minutes from Muscat International Airport. OPAZ has supervised it since Royal Decree 44/2023, and Asyad's Oman Logistics Company operates it. Investors lease land or ready units to run factories, warehouses and food or pharma plants, and two free zones inside the city offer customs and tax incentives.

## What and where is Khazaen Economic City?

Khazaen was first planned as a logistics hub and was relaunched around 2018–2019 as a full "economic city". Industrial areas, logistics, offices, housing and services share one master plan. It sits at the junction of the Muscat Expressway and the Batinah Highway, roughly halfway between Muscat and Sohar.

| Item | Detail |
|---|---|
| Governorate | South Al Batinah (Wilayat of Barka) |
| Area | About 51–52 million m² |
| Airport | Muscat International Airport, about 30 minutes |
| Seaports | Sohar Port about 2 hours; Suwaiq Port nearby |
| Inland port | Khazaen Dry/Land Port (opened 2021, customs on site) |
| Rail | Land set aside for the planned national railway |

## Who manages it?

- **Supervising authority:** [OPAZ](https://opaz.gov.om/), the Public Authority for Special Economic Zones and Free Zones
- **Developer:** Khazaen Economic City LLC, described by its management as one of Oman's largest public–private partnerships. 2018 reporting named Omani state investment and the Saudi MASCO group as partners in the master developer.
- **Operator:** Oman Logistics Company LLC, part of Asyad Group, operates the city and both free zones

Royal Decree 44/2023 also created **two free zones inside the city**: one for light and medium industry and logistics, and one for business and trade. Our separate [Khazaen Free Zone](https://omanregister.com/free-zones/khazaen-free-zone/) page covers registering in the free-zone areas.

## Which sectors are already in Khazaen?

According to figures OPAZ shared in October 2025, cumulative investment in Khazaen passed **OMR 800 million**. In the first half of 2025 alone, 19 agreements worth about OMR 276.5 million were signed, most of them in manufacturing. OPAZ's 2025 annual results named Khazaen as the zone with the fastest growth in added investment, at about 63%.

The main groups of investors are:

- **Manufacturing and packaging:** paper products, sanitary materials, plastics, light industry
- **Pharmaceuticals:** for example the second phase of Opal Biopharma
- **Food:** Salalah Mills, plus the Khazaen central fruit and vegetable market operated with Silal
- **Logistics:** an industrial logistics complex, an international logistics centre, and the land port
- **Support services:** staff housing, offices and a one-stop shop for licensing

This group of businesses matters in practice. Suppliers, packaging, cold chain and logistics firms are already on site.

## What incentives apply in Khazaen Economic City?

Since April 2025, zone incentives have come from the **Special Economic Zones and Free Zones Law (Royal Decree 38/2025)**. Its Executive Regulations (OPAZ Resolution 81/2026) followed in September 2026.

- **Ownership:** up to 100% foreign ownership
- **Income tax:** 10-year exemption from start of operations for qualifying enterprises, extendable twice for special-nature activities. Banks, insurance, telecoms, contracting and land and sea transport are excluded.
- **Customs:** exemption for goods used to set up and run the project and for exports. Mainland sales are treated as imports.
- **Capital:** minimum capital requirements can be waived with approval
- **Services:** a digital one-stop shop, automatic licence renewal, and on-site government services
- **Omanisation:** set by activity; OPAZ's FAQ lists up to 35% for Khazaen

Check with the zone whether a given incentive applies only to the free-zone areas or across the whole city. Large multinational groups are also subject to Oman's 15% domestic minimum top-up tax.

## How do you set up a business in Khazaen?

1. **Prepare a project profile** covering activity, land or building size, investment, utilities (power, water, gas) and staffing.
2. **Agree the site.** Khazaen allocates a plot, warehouse or office and confirms whether it lies in a free zone.
3. **Register the company** on the Oman Business Platform, usually as an LLC or SPC, and join the Oman Chamber of Commerce and Industry.
4. **Sign the usufruct or lease agreement** and get building permits for your design.
5. **Get the environmental permit** for your category. Heavy (Category 1) projects need an ESIA approved by OPAZ.
6. **Build or fit out**, connect utilities, and get the operating licence.
7. **Recruit staff.** Arrange labour clearances, visas and Omani hiring.
8. **Apply for the tax exemption** once you are operating, if you qualify.

For a practical example, read our article on [setting up a factory in Khazaen](https://omanregister.com/khazaen-economic-city-factory/).

## Which documents are typically required?

- Shareholder and manager passports (and Omani IDs for any Omani partners)
- Attested parent-company documents for corporate shareholders: registration certificate, articles of association and board resolution
- A project profile or feasibility study, plus layout and technical drawings for factories
- Environmental documentation as required by your category
- A power of attorney for whoever files on your behalf

## What does it cost to set up in Khazaen?

Khazaen does not publish official land rates or fee tables. Ask for a written offer and compare these items:

| Cost component | Notes |
|---|---|
| Company registration and OCCI | Official government fees, paid online |
| Zone licence and admin fees | Set by the zone and operator |
| Land usufruct or lease | Annual rate per m², usually the largest recurring cost |
| Service charges | Common infrastructure and services |
| Construction and utilities | Your own build, or ready warehouse rent |
| Environmental studies | EMP or ESIA for medium and heavy activities |
| Visas and staffing | Investor and employee visas, plus Omani salaries |

Khazaen has run time-limited offers before, such as the 2020 package of a rent-free first year and 50% off rent in years two and three. That offer has expired, but ask whether a current promotion exists.

## How long does it take?

The company and licence can be ready within a few weeks once documents are attested. A factory takes much longer, because design approval, environmental permits and construction usually add several months. Building in a ready warehouse is the fastest route to operations.

## Pros and limitations

**Pros:** close to Muscat and its labour market, highway access in both directions, customs at the land port, two free zones available, and an established base of manufacturing and food businesses.

**Limitations:** no seaport frontage, no published rate card, and Omanisation targets above those in remote zones. Some regulations for the new free zones are still being rolled out.

## How does Khazaen compare with nearby alternatives?

- [Muscat International Airport Free Zone](https://omanregister.com/free-zones/muscat-international-airport-free-zone/) suits air cargo, e-commerce and high-value goods rather than factories.
- [Sohar Free Zone](https://omanregister.com/free-zones/sohar-free-zone/) and Sohar Industrial City suit you if you need a deep-water port and heavy industry.
- [Rusayl](https://omanregister.com/industrial-cities/rusayl-industrial-city/) and [Al Suwayq](https://omanregister.com/industrial-cities/al-suwayq-industrial-city/) industrial cities (Madayn) are good for production aimed at the local market without free-zone status.

See all options on our [free zones hub](https://omanregister.com/free-zones/) and in [investment opportunities in Oman free zones](https://omanregister.com/investment-opportunities-in-oman-free-zones/).

## How Oman Register helps

Oman Register prepares your project profile and gets an offer from Khazaen. We check whether your plot falls inside a free zone, register the company, and handle attestation, licences and visas. That gives you real numbers to compare with Sohar, Madayn or the airport free zone before you sign a lease.

## FAQ

**Where is Khazaen Economic City?**

It is in the Wilayat of Barka in South Al Batinah Governorate, where the Muscat Expressway meets the Batinah Highway. It is about 30 minutes from Muscat International Airport and about two hours from Sohar Port.

**Who manages Khazaen Economic City?**

OPAZ supervises it under Royal Decree 44/2023. Khazaen Economic City LLC is the developer, and Oman Logistics Company LLC, part of Asyad Group, operates the city and its two free zones.

**Can I lease land and build a factory in Khazaen?**

Yes. Investors receive industrial, logistics or commercial plots under long-term usufruct or lease agreements and build to approved plans. Ready warehouses and logistics units are also available.

**What are land lease rates in Khazaen Economic City?**

Khazaen does not publish a public rate card. Rent depends on plot type, size and location within the city, so ask the zone for a current written offer.

**Is all of Khazaen a free zone?**

No. The 2023 decree created two free zones within the economic city. Free-zone customs and tax treatment applies to enterprises licensed in those areas, so confirm your plot's status before signing.

**What is Khazaen Land Port?**

It is the inland customs and logistics facility opened by Asyad in 2021 as Khazaen Dry Port, on 100,000 m² with a stated capacity of 70,000 containers a year. Cargo can be cleared there before moving to or from the seaports.

## Sources

- [Royal Decree 44/2023 establishing Khazaen Economic City (decree.om)](https://decree.om/2023/rd20230044/)
- [OPAZ — Board statement on Royal Decree establishing Khazaen Economic City (2023)](https://www.opaz.gov.om/en/media-center/news/2023/opaz-board-of-directors-values-the-royal-decree-establishing-khazaen-economic-city-1)
- [OPAZ — Total committed investment in zones reached OMR 22.4 billion (2026)](https://opaz.gov.om/en/media-center/news/2026/total-committed-investment-in-economic-free-and-industrial-zones-reached-omr-22-4-billion)
- [OPAZ — FAQ](https://opaz.gov.om/en/support/faq)
- [Oman Observer — Inflows lift Khazaen's total investments to RO 800 million (2025)](https://www.omanobserver.om/article/1177684/business/inflows-lift-khazaens-total-investments-to-ro-800-million)
- [Oman Observer — Investments in Khazaen Economic City surpass $1 billion (2024)](https://www.omanobserver.om/article/1148691/business/economy/investments-in-khazaen-economic-city-surpass-1-billion-mark)
- [Oman Observer — Khazaen a logistics-centric economic city (2018)](https://www.omanobserver.om/ampArticle/52033)
- [GCC Business News — Asyad opens Khazaen Dry Port in Barka (2021)](https://www.gccbusinessnews.com/oman-national-logistics-group-asyad-opens-khazaen-dry-port-in-barka/)
- [KPMG — Oman issues law for special economic zones and free zones (2025)](https://kpmg.com/om/en/home/insights/2025/06/oman-issues-law-for-special-economic-zones-and-free-zones.html)