The UAE's state-owned steelmaker Emirates Steel Industries (ESI), formerly Emirates Iron and Steel Factory (EISF), has announced that it has commenced the commissioning of its new AED 802 million ($218 million) steelmaking plant in Mussafah, with a production capacity of 1.4 million mt of steel a year.
Accordingly, construction of the country's first integrated steelmaking operation continues to advance with the commissioning of the plant, which will produce steel billets to displace much of ESI's billet imports and also to lower production costs by a significant amount. The new plant in question, including an electric arc furnace (EAF), and a continuous casting unit, is scheduled to begin commercial production in May 2009.
Commenting on the issue, Ahmed Al Dhaheri, ESI's vice president for projects, stated, "ESI has been importing close to 1.2 million mt of steel billets a year from several countries. The operation of the new steelmaking plant will reduce our reliance on imports and increase our share in the local market. ESI's state-of-the-art plant will also allow ESI to transfer billets directly from the caster to the rolling mills. This will reduce our energy consumption and increase efficiency in our operations."
In 2008, ESI has raised its rolling mill's annual production capacity to two million mt, as part of the first phase of its expansion strategy.
Last year, ESI signed a deal worth AED 2.5 billion ($681 million) with Italy-based plantmaker Danieli to execute a second vertically-integrated phase of its expansion, which will increase the operation's annual steel production capacity to three million tons by 2011.
The final link in the production chain will be commissioned later this year, with a plant that converts imported iron ore pellets into raw iron for the new steelmaking plant. The import facilities for the pellets became operational in February 2009.