The UAE's state-owned steelmaker Emirates Steel Industries (ESI), formerly Emirates Iron and Steel Factory (EISF), will spend AED 10 billion ($2.7 billion) on a major production capacity expansion effort over the next five years despite the current market conditions.
Speaking at a conference in Abu Dhabi, ESI chairman Hussein al Nowais said, "The company expects to raise its annual output capacity to three million mt by 2010, and to six million by 2014, from about two million mt, as it builds new plants across Abu Dhabi."
"Emirates Steel is considering acquisitions in the Middle East and outside the UAE. Funding is already in place for the next step of the expansion," Mr al Nowais added.
Mr al Nowais also announced a separate effort by ESI to buy two existing plants within the Gulf. One of the plants would be a downstream facility that transforms raw steel into usable consumer products.
ESI is on the verge of completing the first of four plants capable of transforming steel pellets directly into rebar and coiled steel used by Abu Dhabi's construction sector. A second plant with a capacity of about one million mt is scheduled to come online in 2011, for which a financing plan has been finalized.