Saudi Iron & Steel Company (Hadeed) has awarded Italy’s Danieli a contract to build a steel plant and production line at Jubail on Saudi Arabia’s east coast.

Hadeed will use the steel plant and production line for galvanising, or coating, long products such as reinforcing bars or steel beams. It will have capacity to produce 1 million tonnes a year (t/y) of steel billets or blocks.

Hadeed plans to open the plant during the second half of 2012. When the plant opens, it will increase the company’s total production capacity to 6 million t/y. Long products will account for about 4 million tonnes of production.

Hadeed is an affiliate of Saudi Basic Industries Corporation (Sabic).

The contract award is Danieli’s second in Saudi Arabia in 2009. In August, Saudi Arabia’s Al-Rajhi Steel awarded Danieli a $213m contract to build a steel plant in Jeddah (MEED 16:9:09).

Danieli is also working on the $474m contract to build phase 2B of the Emirates Steel Industries’ plant in Abu Dhabi. The contractor will build a heavy section rolling mill with production capacity of 1 million t/y.

In February 2008, Danieli won the first-phase contract of the expansion. Danieli completed the $1bn contract in May and increased steel production at the plant to 2 million t/y.