Essar Group is awaiting final approvals to begin a $ 4.5 billion investment in constructing a low-carbon steel plant in Saudi Arabia, according to its top official, Prashant Ruia. These approvals are anticipated soon, after which the conglomerate will commence work on the 4 million tonne per year steel plant, along with port facilities at Ras Al-Khair in Saudi Arabia.
Ruia, the director of Essar Capital, which manages the group's investment portfolio, mentioned in an interview with PTI that they have not yet received all the final approvals.
The plant is intended to meet Saudi Arabia's domestic steel demand.
Ruia noted that Saudi Arabia is experiencing significant growth, with much of its current steel supply being imported. Hence, the new plant is designed to serve as a domestic supplier.
Saudi Arabia aims to become a hub for electric vehicle manufacturing, planning to produce more than 300,000 cars annually by 2030. Essar intends to meet the demand for steel required for these vehicles as well as for other consumer goods industries. The construction of the Essar plant is expected to take between three to three and a half years.
Essar, which became debt-free two years ago after selling some infrastructure assets, is now investing in decarbonisation projects and green mobility to drive its next growth phase.
This plant will be Essar Group's first steel project outside India. The conglomerate, which spans metals to infrastructure, previously owned and operated an integrated steel plant in Hazira, Gujarat, but lost it to ArcelorMittal in an insolvency battle.
Ruia added that work on the project will begin once all necessary approvals are received, and the company already possesses the land for the multibillion-dollar project. According to additional information from Essar Group, the integrated steel project will be carried out by its subsidiary, Green Steel Arabia, on a 1,000-acre land parcel in Ras Al-Khair province, with an estimated total project cost of USD 4.5 billion.
The plant will use gas-based direct reduced iron (DRI) and electric arc furnace (EAF) technology to primarily cater to local needs in Saudi Arabia. Essar also plans to invest in building two dedicated berths at Ras Al-Khair port exclusively for its steel project.
