Al Gharbia Pipe breaks ground on Kizad steel plant
The UAE’s first large-diameter, sour service capable welded steel pipe project to start operations in 2018
Al Gharbia Pipe Company (Al Gharbia), a joint venture between Senaat, JFE Steel Corporation and Marubeni-Itochu Steel Inc. (MISI), broke ground on its steel plant in Khalifa Industrial Zone Abu Dhabi (Kizad).
Al Gharbia will be the UAE’s first plant capable of manufacturing large-diameter, thick wall, sour service, longitudinally welded steel pipe to service the oil and gas transportation sector, with the infrastructure and construction sectors as secondary markets.
The plant will be built on a 200,000 sqm plot of land in Kizad and is expected to formally launch operations in 2018.
Once fully operational, production capacity is set to reach 240,000 tonnes annually, of which around 40% will be exported to neighbouring markets in the GCC and greater Middle East, as well as North and East Africa through Khalifa Port and the road network that the UAE’s infrastructure provides.
Commenting on the new venture, Eng Aqeel Madhi, chairman of Al Gharbia Pipe Company, said, “This is a critical milestone in the development of Al Gharbia Pipe Company, and I look forward to the plant becoming fully operational in the near future. Al Gharbia is set to become a worldwide benchmark with regards to the manufacturing of welded pipes, both in terms of technology and quality, as well as production efficiency. The high calibre partnership forged between Senaat, JFE Steel and MISI shall enable Al Gharbia to secure a leading position in the region.”
Senaat holds a 51% stake in Al Gharbia, whilst JFE Steel Corporation and Marubeni-Itochu Steel Inc hold 27% and 22% respectively.
In August 2015, Al Gharbia awarded its EPC contract to a consortium formed by SMS Group and Larsen & Toubro Limited, who will be responsible for constructing the complete plant on a turn-key basis.
In February 2016, Al Gharbia announced the signing of a loan agreement with a group of Japanese and Emirati banks totalling $185m.
Total investment in the Al Gharbia Pipe Company is expected to reach $299m (AED1.1bn).