Danieli starts work on two major steel plants

24 October 2011

The facilites in Kurdistan and Oman will have a combined production capacity of 2.5 million tonnes

Italy’s Danieli has started work on two major steel projects in Iraqi Kurdistan and Oman recently after being awarded the projects earlier this year.

The steel plant manufacturer has finally started work on supplying a meltshop and rebar mill for the Jordan-based Mass Holding in Kurdistan after the client changed the potential location.

“This job is now progressing nicely,” says Franco Alzetta, Danieli’s chief executive officer. “There was some of concern regarding the location, but the client sorted this out and we are moving forward. It is a good project for Kurdistan.”

Planned GCC steel projects
Al-Rajhi Steel integrated complex$3bn
Arcelor Mittal/Bin Jarrallah seamless tube mill$670m
Safco/Hadeed Jubail steel billets facility$630m
Atoun Steel Industry Yanbu II steel plant$265m
Emirates Steel phase III$1bn
Source: MEED Projects

Alzetta added that the power required for the plant will be supplied from Mass Holding’s own power station.

The scope of works for the plant will include a 120-tonne electric arc furnace, ladle furnace and a billet caster. The capacity for the meltshop will be 1 million tonnes a year (t/y), with the rebar mill producing 500,000 t/y.

“This project is only viable in Kurdistan,” says a Middle East steel industry source based in Dubai. “Nowhere else in Iraq has the electricity available to power an electric arc furnace.”  

The value of the contract has not been disclosed by either Danieli or Mass Holding due to the scheme being financed from the balance sheet.

The Italian company is also building a 1 million t/y steel shop at the Indian-owned Shadeed Iron & Steel plant at Sohar in Oman.

The project was awarded to Danieli after direct negotiation between the company and Jindal Steel, which owns the Shadeed plant.

“This deal was signed in the summer, but it has appeared under the radar,” says the steel industry source.

MEED reported in June that Jindal planned to spend $400m on the Shadeed plant over the next two years, taking the total investment to about $864, with the $464 it paid to the UAE’s Al-Ghaith Holdings (MEED 7:6:11).

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