Apr 11 2010
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Qatar Steel gets 20pc stake in South Steel
Sheikh Sulaiman bin Saleem Al Harbi, Chairman of South Steel Company Board of Directors, stated: " Qatar Steel is considered a leading company in the steel industry in the region and is one of the earliest plants in the GCC region.
"Having Qatar Steel as a strategic partner is an addition and a quantum leap to the future of the company and fulfilling its strategic plan, which includes setting up an integrated steel complex in Jazan industrial City. Qatar Steel was chosen due to the mutual desire to create a strong entity in the steel industry with a view to meeting the requirements of the company's targeted markets in terms of steel bars and other types which its strategy embraces".
"Thanks to this agreement with Qatar Steel , South Steel Company has completed all formalities for this vital project, particularly after the state has supported this project with an SR600m soft loan secured by the Industrial Development Fund. The first phase of the project is being executed. This phase includes setting up a steel melt shop on an area of around 5.5 million square metres in Jazan Economic City with a production capacity of one million tonnes of steel billets and 500,000 tons of steel bars. Other expansions will be completed on priority basis after having completed the technical and financial studies for such projects", he said.
Sheikh Nasser bin Hamad Al Thani, Director and General Manager of Qatar Steel , said: " Qatar Steel has become a strategic partner in South Steel Company following technical and financial studies of the project and its strategic location on the Red Sea, as well as the strategic vision of this company and the potential expansion to cover targeted markets".
" Qatar Steel will provide South Steel Company with technical support and supply the plant with sponge iron, which is a key raw material for the manufacture of steel by South Steel Company. Qatar Steel will also share the experience it has gained in the steel industry over more than 30 years with South Steel Company. This will cover operation systems, production, management, marketing and training.
"This step by Qatar Steel enhances the desire and attitude of the two countries to cement economic associations between the two countries. It is the first outcome of the cooperation between Saudi and Qatari companies in vital projects, particularly the industrial ones", added Sheikh Nasser.
South Steel Company is a Saudi closed joint stock company owned by Saudi Pan Kingdom Company and other Saudi and GCC investors. It has a capital stock of SR 450m. The investments in the first phase, which is being executed at Jazan Economic City, for the production of steel blocks and steel bars, amount to SR1.4bn.
"Production is scheduled to commence by mid 2011 and will meet the shortage in the local markets. The markets of the Southern Province will be provided with their product requirements and the surplus will be sold in other KSA provinces as well as the markets of Yemen and other neighbouring African countries.
Established in 1974, Qatar Steel is the earliest iron and steel company in the GCC region. It is one of Qatar Industries companies listed in the Doha Securities Market.
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