Egypt’s Ezz Steel plans to break ground on its $400m Suez direct reduction iron (DRI) plant in Egypt by late July or early August.

The plant, which will have a capacity of 1.9 million tonnes a year (t/y) of DRI upon completion, is on schedule for a completion date in the first quarter of 2012, a source close to the project tells MEED.

“Preliminary work has started at the site and they are conducting pre-civil works at the moment as well as proceeding with the engineering,” the source says. “I believe that the project should break ground before August.”

Ezz is also building a 1.2 million t/y of steel billet caster at a sister facility at Suez. The company decided to manufacture both billets and flat products in order to meet the sometimes volatile demands of the Egyptian steel market. When demand is low for flat products the company plans to produce more billets, which will be sold both domestically and to international markets.  

Italy’s Danieli was awarded the engineering, procurement and construction (EPC) contract to build the facility, which is located east of Cairo at Suez in the North African state, in the first quarter of 2010.