Saudi Basic Industries Corp. (SABIC), the biggest company in the Persian Gulf by market value and in which a 70 percent stake is controlled by the Saudi government, will reportedly more than triple its steel production capacity to 17 million mt by 2020 by means of acquisitions and construction of new facilities.
These ambitions plans arrive at a time when demand for steel is weakening on the back of the global financial crisis; however SABIC expects the market to recover in 2009 due to infrastructure and construction projects due in the Kingdom of Saudi Arabia.
Though the company will be affected by the crisis as well, it estimates it will meet no obstacles in financing its proposed projects.
As previously reported by SteelOrbis, SAFECO and Hadeed, subsidiaries of SABIC, signed an agreement to form a 50:50 joint venture company for the construction of a new flats producing facility in Jubail Industrial City on Saudi Arabia's Gulf coast.
The new mill, which will have an annual production capacity of 1.7 million mt, is expected to be completed in four years.
In addition, Hadeed had stated that it will contract a rebar and wire rod production facility with an annual production capacity of 500,000 mt.