Luxembourg-based steel company ArcelorMittal has finally closed the financing for its SR2.5bn ($670m) seamless steel tube mill in Saudi Arabia.

Bankers in Riyadh confirm that the deal closed in mid-February, but would not comment on the pricing of the debt, nor the tenor.

The deal has been around since May 2009, but a collapse in steel prices created delays as banks worried about financing the project while commodity prices were dropping.

The financing involved about $450m of debt, provided in the local currency by Riyad Bank and Banque Saudi Fransi.

The plant is a joint venture of ArcelorMittal and the local Bin Jarallah Group. It will supply pipes for the oil industry and it will open in late 2011, according to the company. ArcelorMittal says oil firm Saudi Aramco has agreed to buy some of the plant’s output. ArcelorMittal will hold a 51 per cent stake in the project, while Bin Jarallah will hold the remaining 49 per cent. The plant will be the second seamless tube mill in the GCC.

Construction of the plant is understood to have started in late 2010. Once completed, the mill will produce 600,000 tonnes a year of steel tubing.