Gulf Construction Online - ESI to become integrated steel facility

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ESI to become integrated steel facility

01 July 2009

ABU DHABI-based Emirates Steel Industries (ESI) has officially been inaugurated Phase One of its Dh9-billion ($2.45 billion) expansion programme, transforming the company from a simple steel processor to the first fully-integrated steel manufacturer in the UAE and increasing production capacity to two million tonnes.
Prior to the commissioning of Phase One, ESI was the only significant domestic supplier of rebar, rolling imported steel billets to create finished products.
ESI has now become the largest steel plant of its kind in the UAE capable of manufacturing raw steel from iron oxide pellets and this expansion allows ESI to reduce production costs by approximately 40 per cent and also reduce its reliance on imported materials.
Valued at Dh3 billion ($816 million), Phase One has more than doubled ESI’s production capacity to two million tonnes of steel per year, which will reach five million tonnes within five years, in line with the government’s economic diversification strategy.
General Sheikh Mohammed bin Zayed Al Nahyan, Crown Prince of Abu Dhabi, Deputy Supreme Commander of the UAE Armed Forces and chairman of Abu Dhabi Executive Council, who inaugurated the new facilities in Mussaffah said: “ESI’s expansion plan is consistent with the goals of the Abu Dhabi Economic Vision 2030, which maps out the government’s long-term plans for the development and diversification of the emirate’s economy. The expansion of these facilities leverages Abu Dhabi’s competitive strengths and allows ESI to move further up the value chain in its core area of expertise.”
Phase One also allows ESI to build export capacity of competitively-priced steel products, and to diversify its product range to include rebar and wire rod, used for fencing, wires, coils and nails, among other applications.
Sheikh Hamed bin Zayed Al Nahyan, chairman of the Court of the Abu Dhabi Crown Prince and chairman of General Holding Corporation (GHC), the parent company of ESI, commented: “ESI, with the guidance of GHC, has based its strategy on developing a business that will be competitive against the best international producers. This will be achieved by both leveraging access to local energy resources and utilising state-of-the-art technologies. By exploiting economies of scale with the combination of Phases One and Two, ESI is set to transform its production facilities into a world-scale asset.”
Phase Two of the expansion plan, scheduled for completion in the final quarter of 2011, will increase the company’s production capacity to three million tonnes per annum; increase the plant’s total area to 2 sq km; and introduce heavy and jumbo steel sections to ESI’s product portfolio.
Hussain Al Nowais, chairman of ESI, said that after the completion of Phase Two, ESI will continue expanding its production capacity and by 2014 it will be raised to five million tonnes a year.
ESI, a subsidiary of Abu Dhabi Basic Industries Corporation (Adbic), is wholly-owned by GHC, an Abu Dhabi Government-owned company. Strategically located in the Industrial City of Abu Dhabi (ICAD), ESI utilises the latest rolling mill technology to produce reinforcing bar and wire rod.