The Emirates Steel has awarded an AED 1.74bn contract to Danieli Corporation for the construction of Phase II B of Emirates Steel’s AED 9 billion expansion, an ambitious plan the company launched nearly three years ago.
H.H. Sheikh Hamed bin Zayed Al Nahyan, Chairman of the Abu Dhabi Crown Prince’s Court and Chairman of General Holding Corporation (GHC), the parent company of Emirates Steel, signed the contract with Danieli Corporation of Italy.
Danieli Corporation will be the turnkey EPC Contractor for Phase II B, which will see a Heavy Section Rolling Mill with a production capacity of 1 million tons per year added to Emirates Steel’s state-of-the-art facilities by the end of 2011. Phase II B’s rolling mill, the first of its kind in the GCC, will produce heavy section beams and columns, channels, angles and sheet piles, manufactured to international standards.
In June 2009, Emirates Steel inaugurated Phase I of the expansion, which has served to transform the company from a simple steel processor to the first fully-integrated steel manufacturer in the UAE. Prior to the commissioning of its expansion plans, Emirates Steel was the only significant domestic supplier of reinforcing bar (rebar), rolling imported steel billets to create the finished product. The completion of Phase II will double Emirates Steel’s steelmaking capacity, and make it the only producer of heavy sections in the Middle East.
Emirates Steel also announced that Phase II of the expansion project is two months ahead of schedule with onsite construction progress of Phase II A at 52 percent, as of August 2009, and completion scheduled for June 2011.
Sheikh Hamed bin Zayed Al Nahyan explained that Emirates Steel’s focused and fast-paced approach to growth has allowed it to edge ahead of schedule in its expansion plan, bringing the company increasingly closer to its final goal of becoming the largest steel manufacturer in the region.
‘Both 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 expansion is also part of the overall backward integration plan, which will ensure a competitive market position for Emirates Steel’.
Hussain Al Nowais, Chairman of Emirates Steel said the plant’s new facilities will see Emirates Steel increase its production to around 6.5 million tons per annum within the next five years.
‘In support of Abu Dhabi Economic Vision 2030, the expansion is designed to give Emirates Steel a competitive advantage over its international competitors by giving it better access to local energy resources and utilizing state-of-the-art technologies. Once Phase II B is complete, we will be the only producer of heavy sections in the MENA region and will be able to offer drastically-reduced lead times and an improved product offering in terms of piece count and cut-to-length services,’ Al Nowais said.
‘With demand for heavy sections currently at 1.5 million tons per year in the GCC, and predicted to double by 2015, our Phase II B product, which is a more flexible, sustainable and cost-effective alternative to concrete, will be essential to the local and regional market. The growing number of projects in the GCC working on developing infrastructure, industrial plants, power transmission towers, bridges, sea ports and high rise towers all require the new products we will be able to supply in large numbers once the expansion is complete,’ Al Nowais added.
Commenting on the company’s Emiratisation drive, Al Nowais said, ‘Once expansion is complete, an estimated 2,000 more jobs will have been created in the country. Emiratisation is one of our highest priorities and we remain dedicated to contributing to this important government initiative’.
The completed expansion works for Phases I and II will include a DRI Plant, with a capacity of 1.6 million tons per year and a steel making and casting plant, with a capacity of 1.4 million tons per year.
The steel making plant will produce beam blanks and blooms which will serve as feed stock for the heavy section mill, due to come online with the completion of Phase II B by the end of 2011. Phase II will also increase the plant’s total area to 2 square kilometers.
