Dhahran, Saudi Arabia — Saudi Aramco, Chinese steel conglomerate Baoshan Iron and Steel Company (Baosteel) and the Public Investment Fund (PIF) will build the largest integrated steel plate manufacturing complex in Saudi Arabia.
Subject to the necessary approvals from the competent regulatory authorities and closing conditions, the joint venture is expected to be located in Ras Al Khair Industrial City, one of the four special economic zones recently announced by Crown Prince Mohammed bin Salman, PIF said in a statement.
The complex’s steel plate production capacity is expected to be up to 1.5 million tons per annum, and the facility will also be equipped with premium facilities including a direct reduction iron (DRI) furnace powered by natural gas, as well as an electric arc furnace, which aims to reduce carbon dioxide emissions from the iron manufacturing process by up to 60 percent compared to a conventional smelting furnace.
The DRI plant would be compatible with hydrogen without the need for major equipment modifications, potentially reducing CO2 emissions by up to 90 percent in the future, the statement said.
Aimed at meeting the needs of the Saudi market, with plans to export to the GCC and MENA region, the project is expected to create new job opportunities and significantly reduce dependence on imported steel plates, serving customers in several strategic industrial sectors including pipeline manufacturing, rigs, offshore platforms, tanks, pressure vessels, and shipbuilding. It also aims to serve the marine, construction and renewable energy sectors.
Saudi Aramco President and CEO Amin Nasser said, “The project is expected to have a positive impact on the localization of the company’s supply chains, enhancing its reliability, in addition to positively impacting the growth and diversification of the local economy, generating jobs for Saudis, and creating additional value for our company and our partners.”
PIF Deputy Governor Yazid Al-Humaid said the project will also build on PIF’s mandate to establish new strategic partnerships locally and globally; localize technologies and knowledge; enable the private sector; and create more direct and indirect job opportunities in the local market.
“Since 2017, PIF has invested in 13 strategic sectors and established 77 new companies domestically,” he said.
Zhou Jixin, Chairman Baosteel, said this project is an active practice by Baosteel to explore lower-carbon paths for the steel industry, a major achievement in promoting the international development strategy of Baosteel.