Foulath still to finalise $2bn pelletising plant contracts

12 October 2010

Middle East steel company is working on expansion plans in Egypt and Oman

Kuwait’s Gulf United Steel Holding Company’s (Foulath) plans for three new pelletising plants totalling more than $2bn have still not been finalised.

Speaking at the MEED Middle East Steel 2010 conference in Abu Dhabi, Anurag Bisaria, a director at Foulath’s major shareholder Gulf Investment Corporation (GIC), said a number of issues still had to be formalised at the proposed projects in Oman and Egypt.

“With regard to Oman, we still need to sign an agreement with a partner that will use a percentage of the offtake,” he said. “[Foulath] had signed a preliminary agreement with one interested party, but nothing has been agreed yet. We are still discussing the project with a number of consortiums.”

The Oman plant will be built in Salalah in the south of the sultanate and the initial partner in the scheme was Japan’s JFE Steel Corporation.  

Foulath is also planning to open two plants in Egypt, but Bisaria said that a suitable land allocation still needs to be granted by the Egyptian authorities.

“[Foulath] is concentrating on a plant at Alexandria first and when we have everything in place we will press on,” he said.

Bisaria also revealed that Foulath is planning to form a partnership with an iron ore mine in Brazil in order to fully integrate its operations.

“We want to make either a direct investment or offer shares in Foulath to any interested parties. The ideal situation is investing in a mine in Brazil that can supply about 50 per cent of our requirements when we have our all of our plants in operation. This would mean about 17 million tonnes a year of supply.”

Kuwait’s Gulf Investment Corporation (GIC) owns 50 per cent of Foulath, with Qatar Steel owning 25 per cent, 10 per cent each by the Kharafi Group of Kuwait and the National Industries Group of Kuwait, and 5 per cent by the Kuwait Foundry Company.

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