Al-Rajhi meets bidders for $3bn steel project

05 February 2012

Technology providers and contractors descend on Jeddah to hear plans for Saudi Arabian steel complex

The local Al-Rajhi Steel is holding clarification meetings with all of the prequalified technology providers and contractors looking to bid on the $3bn steel complex planned for King Abdullah Economic City near Jeddah in Saudi Arabia.

The meetings will be held from February 6-8 in Jeddah and Al-Rajhi Steel will take the opportunity to set out its objectives for the scheme. All the prospective technology providers and engineering, procurement and construction (EPC) contractors have sent delegations.

“Most of the regional steel industry is in Jeddah right now,” says a steel industry executive working in the Middle East. “Not only will these meetings give everyone a detailed roadmap as to what needs to be done, but it will also give technology providers the chance to meet with EPC contractors and open talks for prospective bidding consortia to be formed.”

Al-Rajhi plans to execute the project on a lump-sum turnkey basis, which means that all of the technology providers will have to team up with EPC contractors to bid for work.

The prequalified technology providers include:

  • Danieli (Italy)
  • Tenova (Italy)
  • Midrex (US)
  • Siemens Steel (Austria)
  • SMS Group (Germany)

The prequalified EPC contractors include:

  • Daelim Industrial (South Korea)
  • Hanwha Engineering & Construction (South Korea)
  • Hyundai Engineering & Construction (South Korea)
  •  Samsung Engineering (South Korea)

Al-Rajhi has also prequalified a number of local sub-contractors that will also be expected to carry out a large percentage of the construction work at the site. This has been done to ensure jobs are provided for local workers during the construction phase.  

The scope of works for the Al-Rajhi complex includes a direct-reduced iron (DRI) plant producing 1.8 million tonnes a year of steel, two steel shops produced billets, blooms and slabs, a mill producing long products and a mill producing flat products, as well as a cold rolling process plant. 

The project is being fast-tracked during 2012 due to a time limit being placed on the gas allocation from Saudi Aramco.

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