South Korea’s Hanwha Engineering & Construction has emerged as the frontrunner to be awarded the engineering, procurement and construction (EPC) contract for the aluminium rolling mill project at Ras al-Zour in Saudi Arabia.
“Hanwha has bid around $650m for the rolling mill,” says a source. “In today’s market this is as competitive as it gets.”
The prospect of a formal contract award could be damaged by media reports from South Korea that say Hanwha Group chairman Kim Seung-yeon has been indicted on embezzlement charges.
Seung-yeon was indicted by South Korean prosecutors along with 10 other group executives on charges related to the embezzlement of hundreds of millions of dollars from the company.
“While this shouldn’t affect the day-to-day running [of Hanwha Engineering & Construction], it might still affect the outcome of this particular project,” a South Korean contracting source says.
No-one was available for comment at Hanwha when contacted by MEED.
The joint venture partners behind the scheme, the Saudi Arabian Mining Company (Maaden) and the US’ Alcoa, has also shortlisted South Korea’s Samsung Engineering and Daelim, but Hanwa is believed to be the lowest bidder (MEED 25:1:11) .
The rolling mill will have a capacity of 380,000 tonnes a year when completed, which will make it the largest mill constructed outside of China in the past 20 years. The plant will produce can stock that will be sold within Saudi Arabia and the rest of the GCC.
The Ras al-Zour complex will also include a 1.8 million-t/y alumina refinery and a 740,000-t/y aluminium smelter, with a 4 million-t/y bauxite mine being built at Al-Baitha.
Maaden holds a 74.9 per cent stake in the aluminium complex, while Alcoa owns the remaining 25.1 per cent.