Decision imminent on billion-dollar aluminium project
The joint venture partners behind an aluminium rolling mill project at Ras al-Zour in Saudi Arabia are on the verge of awarding the engineering, procurement and construction (EPC) contract to one of three shortlisted contractors.
In-kingdom contracting sources say that the Saudi Arabian Mining Company (Maaden) and the US’ Alcoa have shortlisted South Korea’s Samsung Engineering, Daelim, and Hanwha Engineering & Construction.
“After an aggressive bidding process there are only three companies left in the race,” says a contracting source familiar with the deal. “It is my understanding that the bids for the EPC will mean that the cost of construction is going to be much lower than the [$2.5bn] figure that has been reported.”
All three of the South Korean companies left in the race have submitted bids of about $700m. A decision is expected to be announced by the first week of February.
Another Middle East-based metals industry expert says that the EPC contract added to the equipment procurement, which will be novated over to the winning EPC contractor, will total between $1bn-$1.2bn.
“The [joint venture] partners procured equipment from a number of different sources and the whole process was run from the US so it is quite difficult to put an exact figure on how much it cost,” says the expert. “They seem to be able to get the best deals possible though if the EPC bids are correct.”
Maaden and Alcoa have procured equipment for hot and cold mills, the coil coating line and preheat furnaces from Germany’s SMS Siemag and BWG Bergwerk and Austria’s Ebner respectively. The US’ Wagstaff will also provide the facility with ingot and billet casting systems (MEED 24:9:10).
The rolling mill is part of an aluminium complex and will have a capacity of up to 450,000 tonnes a year (t/y) when completed in the fourth quarter of 2013. The site will also include a 1.8 million-t/y alumina refinery and a 740,000-t/y aluminium smelter, with a 4 million-t/y bauxite mine being built at Al-Baitha.
Maaden holds a 74.9 per cent stake in the aluminium complex, while Alcoa owns the remaining 25.1 per cent.
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