India’s Kanoos Group has decided to keep its prospective Gulf Steel plant project in Kuwait on hold until at least the first quarter of 2011 while it concentrates on a similar facility in the Kurdistan region of Iraq, a source tells MEED.

The source says that the company is still committed to the 100,000 tonnes-a-year (t/y) plant, but wants to ensure that the 146,000-t/y facility located in the city of Erbil is fully operational first.

“Erbil started production about a month ago and it is going well,” the source says. “The steel is being sold on the domestic market because the demand in that region at the moment is very high.”

The plant in Erbil is producing billets from scrap metal which are then used to make TMT (thermo-mechanical treatment) bars, reinforced bars for the construction industry.

“There is a lot of scrap available in Iraq at the moment so sourcing it is easy at the moment,” the source says.

The source adds that future plans for the facility includes the construction of a further furnace.

“A new furnace is in the pipeline, but I am not sure about an exact timeline on that,” the source says. “It will depend on demand.”