Industry

Bahrain: Aluminum giant targets recovery

Bahrain’s largest industrial firm, Aluminium Bahrain (Alba), is looking expand into new markets as it competes to hold its place in an increasingly competitive regional market. In large part due to the global economic downturn, Alba recorded a net loss of US$220m in 2009, a sharp turnaround from the US$781.9m profit it posted the year before. Late last month Mumtalakat Holding, the government-owned investment company that includes Alba and all Bahrain’s non-oil state-owned firms, announced losses of US$487m for 2009. However, in a recently published report, Bahrain’s Economic Development Board (EDB) put the 2009 results firmly into perspective. According to the report, issues last month, the Kingdom’s economy expanded by 70% over the past decade, with the manufacturing sector a major contributor to growth. During the previous five years up until 2008, manufacturing output rose by 80% and while industry was affected by the global recession, it managed to avoid the worst of the downturn, said the EDB. Mumtalakat said Alba dipped into the red in 2009 partly because of its need to take into account unrealized losses on derivatives and a one-time restructuring charge. It said that despite last year’s decline in prices in the global aluminum market, Alba was able to generate positive cash flows. Last year’s results were a rarity for the company. Established in 1968, Alba was one of the first large-scale industrial developments in the Gulf. Since production began in 1971 it has expanded output from an initial 56,000 tons to its present capacity of 870,000, placing it among the world leaders in aluminum production. (Source: OBG)

Hyundai Engineering wins US$1.2bn order from Kuwait

Hyundai Engineering & Construction Co., South Korea's top builder, said that it has signed a 1.4 trillion won (US$1.2 billion) deal to build a container port in northeastern Kuwait. Under the deal with the Ministry of Public Works of Kuwait, Hyundai Engineering will complete the port 42 months after it breaks ground, the builder said in a regulatory filing, without saying when it will begin the work. The port will be built on Boubyan Island, located in the northeastern part of the Middle Eastern country, Hyundai Engineering & Construction said.

Ducab wins big Abu Dhabi contract

Ducab, a top manufacturer of power and special cables in the region, said it has won its second contract in Abu Dhabi's Integrated Gas Development (IGD) project, raising its total order for Gasco's Habshan 5 project to over AED126 million (US$35 million). The contract win comes following a series of recent negotiations in Yokohama, Japan, said a company statement. Ducab's most recent agreement with Japan's JGC Corporation is valued at AED51 million (US$13.8 million) for the supply of custom power cables to the new Habshan 5 Gas Processing Plant. This follows the signing of a contract recently with Hyundai Engineering & Construction for supporting the utilities and offsite part of the development, a AED75 million agreement which could see Ducab supplying up to 70 per cent of the associated facility's total power cables requirements. Both of the developments are part of a AED33.8 billion Abu Dhabi's (IGD) project, which aims to increase offshore gas production and provide a permanent link between Adnoc's offshore Umm Shaif field and new onshore processing facilities at Habshan and Ruwais via Das Island.

Saudi Maaden approves US$4.5bn funding for Alcoa JV

State controlled Saudi Arabian Mining Co (Maaden) said its board had agreed on a US$4.5 billion financing plan for the first phase of a joint aluminum plant with US firm Alcoa. The financing will be provided by a group of local and foreign banks, as well as Saudi Arabia's Public Investment Fund and the Industrial Investment Fund, the Saudi firm said. It gave no details of the terms of the deal. In a statement posted on the Saudi bourse website, Maaden said: "This will cover 60 percent of the cost for the first phase of the project, while the rest of the financing will be made by the partners (Maaden and Alcoa)." The joint venture started work on the US$10 billion complex, which it said will be the world's largest fully integrated aluminum complex, earlier this month. The complex will include a bauxite mine and an alumina refinery, aluminum smelter and rolling mill at Ras Al Zour.

Oman: Firm foundations

Oman's growing industrial sector is set to benefit from a number of infrastructure projects designed to enhance capacity in the Sultanate. Significant projects are under way to improve logistics, power and water capacity, particularly in the industrial zone of Sohar, which has been targeted for growth by the government. Moreover, Oman is pioneering new technology to improve the utilization and conservation of existing resources. Recent months have seen the government invite tenders for pre-qualification for the proposed Oman National Railway, a multibillion-dollar project designed to create a freight and passenger railway linking the Sultanate's main urban and industrial centers. Phase one of the project will see the construction of a 280-km line that will link the industrial zone of Sohar with the capital Muscat. According to the Oman Observer, a total of 31 firms submitted pre-qualification bids to become project manager of the National Railway by the June 14 deadline, including Mott MacDonald, Arup Gulf and Bechtel. The contract is expected to be awarded in the first quarter of 2011. The strong international interest generated by the National Railway project demonstrates the confident nature in which the Omani government has proceeded with its infrastructure development plans thus far. Mid-June, for example, also witnessed the opening of the region's first inland clearance depot (ICD) at Muscat Container Depot. The ICD will enable the handling of containers destined for the Oman International Container Terminal at a point closer to Muscat, effectively creating an extended gateway for the Port of Sohar, including Customs clearance. The ICD will improve logistical links between Muscat and the industrial zone at Sohar. (Source: OBG)

Aresco wins US$130m BMIC plant deal

ASEC for Manufacturing and Industrial Projects (Aresco) said it has signed a US$130 million contract to construct a new cement plant for the Building Materials Industry Company (BMIC) in the Upper Egyptian governorate of Assiut. A turnkey contractor serving the cement, energy, petrochemicals, petroleum and general industrial sectors, Aresco is a subsidiary of ASEC Holding, Citadel Capital's platform company in the industrial services and contracting sectors. As per the contract, Aresco will be providing all the civil, electrical and mechanical works for the 1.5 million tons per annum cement plant, which is due to be completed in 22 months. The company will also carry out all the steel fabrication as well as testing and commissioning for BMIC on a turnkey lump sum basis, said a top official of Citadel Capital, the leading private equity firm in the Middle East and Africa. "The integration of Aresco's in-house design and manufacturing capabilities - which include its own workshops and fleet of cranes - have made the company a strong competitor in both the cement and general industrial sectors," said Tarek Salah, managing director at Citadel Capital.

SIIG and Arabian Chevron Phillips plan downstream investments

Saudi Industrial Investment Group (SIIG; Riyadh) and Arabian Chevron Phillips (ACP) say they plan to diversify into downstream projects, which will provide products for a number of consumer needs in Saudi Arabia and the neighboring regions and require an investment of some SR1.8 billion (US$480 million) from each partner. One of the projects will produce nylon 6,6, including adipic acid. Others will depend on raw materials available at the Jubail, Saudi Arabia site. The partners are currently building their third petrochemical joint venture at Jubail, which will be operated by Saudi Polymers Co., owned 50% by ACP, a wholly owned subsidiary of CP Chem, and 50% by SIIG. The complex, expected on stream next year, will produce ethylene, propylene, and hexene-1.

GB Auto to build US$13 million logistics center

GB Auto will build a 75 million Egyptian pound (US$13 million) automotive warehousing and logistics facility near Cairo it hopes will generate 60 million a year in savings and fees, it said. Egypt's biggest listed vehicle assembler will build the facility in Sadat City, 90 km northwest of Cairo, on 700,000 square meters it won in a government tender. The project will cost 75 million pounds, including purchase of the land, which the company will pay over 2-3 years. It expects the facility to come on line in 12-18 months. "This bonded facility will allow us to receive our imports of containers as well as completely built-up vehicles as soon as they arrive in Egypt's ports," chief executive Raouf Ghabbour said.