A new direct reduction steel slab plant is taking shape at Hormozgan Steel Company (Hosco) in the south. Key contracts on the estimated $600 million project are expected to be signed by the end of the Iranian year in March 2005 and be completed by 2009. Basic engineering work is already under way and is expected to be complete in early 2005.
The project will have capacity of 1.5 million tonnes a year (t/y). The client has already selected a Midrex module to be supplied by Germany's SMS Demagand installed by the local Iran International Engineering Company (IRITEC) and Fulad Paya. Feedstock is to come from the Gol-e Gohar ore processing plant, for which a 4 million-t/y turnkey expansion project is being carried out by a consortium comprising Finland's Outokompu, Europe's ABB Thameand Copper Investment Company and Cement Industries Company, both local. Hormozgan is a new company owned by Iranian Mineral Industries Development & Renovation Organisation (IMIDRO)and the project is to be carried out on a buyback basis. The product is destined for export. The offtaker will be UK-based Balli Group, which has metals interests in Iran, the UK, the US and Eastern Europe, and whose local affiliate acts as the local agent for SMS Demag (see below). The project will be financed by Fortis Bankand Bank Mellat, with credit guarantees provided by Italy's Sace. The consultant is the local Barsoo Engineering. Iran's steel capacity is to be further boosted by another major project at Khouzestan Steel Company, for which direct reduction and meltshop facilities are to be added, bringing capacity to 3 million t/y from 1.5 million t/y (MEED 29:7:04).
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