The local Emirates Steel Industries (ESI) is planning to tender a $1bn phase four expansion in the third quarter at its complex at Mussafah in Abu Dhabi.

The fourth phase will consist of a plate mill with a direct reduced iron (DRI) plant, a steel melting plant and a thick slab caster.

“The fourth phase is being planned shortly after the third [phase] which is a surprising move,” says a steel industry source familiar with the deal. “I don’t know for definite if the gas allocation is in place yet, but if it is then it looks like ESI will try and execute both expansions on overlapping timescales.”

Tenders are expected to be released in July with an award due in the fourth quarter. Production would then be expected for the fourth quarter of 2015. Steel plate uses include construction, marine vessels and the military.

ESI is currently tendering its $1bn third phase and bids are expected to be submitted by the end of March.

The three technology providers for the phase III expansion are Italy’s Danieli Group, Germany’s SMS Group and Austria’s Siemens Steel. Danieli has its own construction arm so is bidding alone, but SMS is being partnered by the local/UK’s Petrofac Emirates while Siemens is joining forces with South Korea’s Hyundai Engineering & Construction.

The scope of works for the phase III will include the construction of a DRI plant, steel melting plant, thin slab caster and a continuous strip rolling mill. Capacity will be 1.4 million tonnes-a-year.

The plant will produce hot-rolled coil (HRC) and narrow plate. HRC and narrow plate are used in a wide range of products including steel tubes, staircases and industrial flooring.

ESI were not available for comment when contacted by MEED. The company is owned by Abu Dhabi’s state-controlled GHC through Abu Dhabi Basic Industries Corporation (Adbic).