Industry

Emirates Steel eyes 6.5 million tpa production

Abu Dhabi's Emirates Steel has completed the second phase of its expansion plan and intends to further boost production to around 6.5 million tons per year within the next four years, the company said in a statement on at the beginning of January. Emirates Steel, a subsidiary of government-owned Abu Dhabi Basic Industries Corporation (Adbic), launched a two-phased expansion program worth $2.45 billion in January 2006. The first phase, worth $816 million, was completed in June 2009 and has increased the rolling output capacity from 750,000 tons to 2.1 million tons. The second phase of the expansion plan has raised its steelmaking capacity to 2.8 million tons per annum and its capacity to produce direct reduced iron (DRI) to 3.2 million tons, making it one of the biggest DRI producers in the Middle East, Emirates Steel said. 'The plant's new facilities together with its planned further expansions will see Emirates Steel increase its production to around 6.5 million tonnes per annum within the next four years,' the statement said. The expansion plan and overall growth strategy of Emirates Steel are in line with the government's long-term plans for the development and diversification of the Emirate's economy, the company's chairman, Suhail Al Ameri, said in the statement. With the latest expansion phase complete, Emirates Steel has started the hot commissioning of its heavy section mill at a cost of around $650 million. The steelmaker can now produce large-size sections, beams, columns and sheet piles. Outlook for steel demand was still robust, despite the global economic crisis leading to the cancellation of a number of projects. The company said: 'Construction projects, mainly in Abu Dhabi, are currently the key driving force behind the steel industry growth.' Source: Reuters

Abu Dhabi firm plans $200 million extrusion plant

Taweelah Extrusion Company (Talex) said it was setting up an extrusion products plant at Abu Dhabi's new industrial zone with an investment outlay of Dh735 million ($200 million), as the oil-rich emirate works to diversify its economy. Talex, a joint venture between state-owned Abu Dhabi Basic Industries Corp and privately owned Gulf Extrusions, had signed a long-term lease agreement with the Khalifa Industrial Zone Abu Dhabi (Kizad), a statement from Kizad said. The plant will receive aluminum in molten form from Emirates Aluminium (Emal), another tenant of the zone. Some 30 companies have signed agreements to establish themselves at Kizad with nearly 100 more awaiting approvals. Talex plans to start making extrusion products for the automotive markets in the fourth quarter of 2013. Source: Reuters

Government projects 'to lead Saudi cement growth'

The Saudi cement sector will continue to witness strong demand in 2012, led primarily by government projects, according to a report from NCB Capital, Saudi Arabia’s leading wealth advisor and largest asset manager. However, ongoing fuel issues with Aramco could delay the 4.5 million tons of new capacity expected in 2012, the report said, adding that the potential supply constraint should provide strong pricing support. The new NCB Capital report analyzing the Saudi cement sector noted that there are concerns on supply due to an apparent inability by Yanbu and Southern Cement to receive increased quantities of subsidized fuel from Aramco for their new lines, leading to potential delays in the start of their operations. “If this is the case, this would lead to a strong pricing support in 2012,” said Farouk Miah, acting head of Equity Research at NCB Capital. Source: TradeArabia News Service

Qatar Steel ups stake in Saudi firm

Qatar Steel, a wholly-owned subsidiary of Industries Qatar, increased its stake in South Steel of Saudi Arabia to 29.74%, the company said, a nearly nine-percentage point increase in ownership. A statement issued by the company said it will be involved in most aspects of South Steel's business, including operations, production and administration. Qatar, the world's largest exporter of liquefied natural gas, has been investing in other industries. Earlier this month, Qatar Steel secured a $250 million subordinated loan facility from two Gulf banks to finance expansion. The company launched a $5.7 billion aluminum plant in December 2009, which was inaugurated last year, and currently has foreign investments in Bahrain, Saudi Arabia and the United Arab Emirates. South Steel consists of an integrated steel melting complex and has a production capacity of 1 million MTPA of steel billets and 500,000 MTPA of steel reinforcement bars. Source: Reuters

India's JBF to invest $200 million in Bahrain plant

Leading Mumbai-based polyester film company JBF is looking to invest $200 million in a plant in Bahrain that is expected to create 300 jobs. The project in Salman Industrial City will have a production capacity of 90,000 tons in the first phase, which could be expanded and diversified at a later stage. Industry and Commerce Minister Dr. Hassan Fakhro signed the contract to establish the large industrial project with the Indian company. The company was allocated land of 65,000-square-meter in Bahrain International Investment Park (BIIP) in Salman Industrial City. The company is willing to invest a preliminarily $200 million into the project to produce polyester films used in packaging of electronics and food. These products will be mainly marketed in the European Union and the US in order to benefit from the free trade agreement with the US. Construction of the project is due to start at the beginning of 2012. Source: India Times

Qurain plans $1bn petchem plant in Saudi

Kuwait's Qurain Petrochemical Industries Co (QPIC) plans to develop a petrochemical plant in Saudi Arabia, expected to cost more than $1 billion, it said in late December. United Industries Co, a Kipco Group company, is a major shareholder in QPIC. The complex, which will be located in Saudi Arabia's petrochemicals hub, Jubail, will produce an annual 800,000 tons of polyethylene terephthalate (PET) and 1 million tons of purified terephthalic acid (PTA). Paraxylene will be used as feedstock. The company has appointed IHS to advise on the planning and development of the project, it said. Source: Reuters

KBR wins deal to revamp Iraq fertilizer plant

US-based KBR, a leading engineering and technology firm, will provide its proprietary Ammonia Process and related engineering services to revamp the North Fertiliser Plant in Baiji, Iraq. The revamp contract from First Global Company will aim to increase the plant capacity to 120% of the original design. The original plant, which started up in 1989 was designed to produce 1000 MTPD Ammonia. “KBR is proud to have the opportunity to work with First Global Company to revamp the North Fertilizer Plant,” said John Derbyshire, president, KBR Technology. “Helping our licensors debottleneck their plants and achieve greater production capacities and process efficiencies is one of our core competencies and will be an area of significant growth worldwide.” Source: TradeArabia News Service

Saudi steel firm picks BNP for $3 billion IPO

Saudi Arabia's Al Rajhi Steel has appointed BNP Paribas as the financial adviser for an initial public offering of its $3 billion steel project north of Jeddah, Middle East Economic Digest said. The timing of the IPO on the Saudi stock exchange is still unclear, London-based Meed said, but the shares are likely to be priced at 10 riyals ($2.67) each, equivalent to par value in the kingdom. The new steel complex is situated in King Abdullah Economic City is one of six purpose-built communities, which are aimed at attracting investment and add development to the country. At least one local bank is likely to be appointed to a lead manager role at a future date, one banker told Reuters, to provide the necessary infrastructure required to market an IPO in Saudi Arabia's retail investor-dominated equity markets. Source: Reuters

Emal to invest $3.8 billion in production boost

Emirates Aluminium (Emal), a joint venture between Abu Dhabi's Mubadala and Dubai Aluminium (Dubal), plans to invest $3.8 billion for its phase two development as it ramps up production to become the single largest greenfield smelter in the world, its chief executive said. "Phase two, which we have just started rolling will have an investment of $3.8 billion," Saeed Fadhel Mazrouei told a forum of United Arab Emirates and German businesses in Abu Dhabi. The first phase investment totaled $5.7 billion he said. German companies are actively involved in building Emal's facilities with 23 German firms securing contracts worth $243 million in the first phase. In the second phase, German companies have already bagged contracts worth $184 million, he said. Emal has received loan facilities of $220 million from the German Export Credit agency, Mazrouei also said. Current production is 750,000 tons per year, rising to 800,000 tons by the end of 2012, he said. Production will rise further to 1.4 million tons annually when phase two gets operational in 2014, he said. In August, Emal said it had awarded $700 million in contracts for an expansion project it plans to complete by 2014. Emal's products are exported to 280 companies in 36 countries, Mazrouei said. Source: Reuters