In a groundbreaking development, Aramco, a prominent player in the global energy and chemicals sectors, has joined forces with Baoshan Iron & Steel Co., Ltd. (Baosteel), a renowned steel conglomerate, and the Public Investment Fund (PIF) to forge a shareholders' agreement. This agreement paves the way for the establishment of a cutting-edge integrated steel plate manufacturing complex within the Kingdom of Saudi Arabia.
Pending the necessary regulatory approvals and fulfillment of closing conditions, a groundbreaking joint venture complex is anticipated to take shape in Ras al-Khair Industrial City. This ambitious project aligns with the vision of His Royal Highness Prince Mohammed bin Salman bin Abdulaziz Al Saud, Crown Prince, Prime Minister, and Chairman of the Council of Economic and Development Affairs, who recently unveiled four new Special Economic Zones.
In a groundbreaking collaboration, Aramco, the leading energy and industrial services giant, is set to join forces with Baosteel, a renowned player in the advanced steel plate industry, and the Public Investment Fund (PIF), a powerhouse with robust financial capabilities and investment expertise. This ambitious venture aims to establish a cutting-edge complex that will seamlessly integrate Aramco's unparalleled energy and industrial services ecosystem with Baosteel's state-of-the-art steel plate industry capability, bolstered by PIF's formidable financial prowess. The convergence of these industry titans promises to revolutionize the landscape and unlock unprecedented opportunities in the global market. In a groundbreaking development, the Kingdom of Saudi Arabia is set to establish a pioneering facility that will revolutionize the steel industry not only within its borders but also across the entire Gulf Cooperation Council (GCC) region. This state-of-the-art establishment will mark a significant milestone in advancing the regional steel industry ecosystem, propelling it to new heights of innovation and progress. In a bold initiative, the project sets out to bolster the domestic manufacturing sector by localizing the production of heavy steel plates. With a focus on knowledge transfer and the creation of export opportunities, the project aims to revitalize the industry and pave the way for economic growth.
In an exciting development, the facility is projected to boast an impressive steel plate production capacity of up to 1.5 million tons per year. In addition, the facility will feature cutting-edge technology, including a natural gas-based direct reduced iron (DRI) furnace and an electric arc furnace. These advancements have the potential to significantly decrease CO2 emissions during the steel-making process, with an impressive reduction of up to 60% when compared to the conventional blast furnace method. In an exciting development, it has been revealed that the DRI plant has the potential to seamlessly integrate hydrogen into its operations, eliminating the need for extensive equipment modifications. This groundbreaking compatibility could pave the way for a significant reduction in CO2 emissions, with estimates suggesting a staggering 90% decrease in the future.
In a recent statement, Amin H. Nasser, the President and CEO of Aramco, expressed his optimism regarding the Kingdom's inaugural steel plate production facility. Nasser believes that this new development will not only bolster Saudi Arabia's steel industry ecosystem but also contribute to the localization of the supply chain. In a groundbreaking move, Aramco, the renowned oil giant, has unveiled its flagship industrial investment program, Namaat. Backed by the government's Shareek program, this strategic joint venture is poised to not only generate employment opportunities but also make significant contributions to economic growth and diversification. The formation of this joint venture serves as a prime illustration of the convergence of expertise from various sectors. In a strategic move to bolster the industrial sector in the Kingdom, Baosteel and PIF have stepped up to provide support in capacity building. With their assistance, Aramco is poised to generate further value for both the company itself and its esteemed partners.
In a recent statement, Yazeed A. Al-Humied, the Deputy Governor and Head of MENA Investments at the Public Investment Fund (PIF), emphasized the organization's commitment to driving economic diversification in Saudi Arabia. Al-Humied highlighted PIF's role in unlocking various opportunities and facilitating growth in key strategic sectors within the local market. In a move aimed at bolstering Saudi Arabia's industrial development and solidifying its position as a key player in the metal industry, a strategic partnership has been forged to establish a state-of-the-art integrated steel plate manufacturing facility. The ambitious venture seeks to enhance the country's capabilities in the production of steel plates, thereby positioning it as a prominent supplier within the sector. In addition, the initiative will further enhance the Public Investment Fund's (PIF) mission to forge fresh alliances both domestically and internationally, harness cutting-edge technologies and expertise, empower the private sector, and generate a multitude of employment prospects within the local market. Since 2017, the Public Investment Fund (PIF) has made significant investments in a total of 13 strategic sectors while also successfully establishing a noteworthy 77 new companies within the domestic market.
In a recent statement, Zou Jixin, the esteemed Chairman of Baosteel, expressed his enthusiasm for a groundbreaking project that aims to pave the way for a more sustainable future in the steel industry. This ambitious endeavor, according to Jixin, is a testament to Baosteel's unwavering commitment to exploring innovative and environmentally friendly approaches. Furthermore, he emphasized that this project represents a significant milestone in the realization of Baosteel's international development strategy. In a bid to bolster the localization of the steel industry chain and foster economic growth within Saudi Arabia, a groundbreaking project has been set in motion. With the primary objective of generating employment opportunities and driving local economic prosperity, this initiative holds great promise for the Kingdom.
In a resounding show of support, Mr. Chen Derong, esteemed Chairman of Baowu Group, and Mr. Hu Wangming, distinguished President of Baowu Group, have unequivocally thrown their weight behind the project, exuding unwavering confidence.
Saudi Arabia has been identified as the primary target market for the project, with intentions to expand its reach to the Gulf Cooperation Council (GCC) and the wider Middle East and North Africa (MENA) region. In a promising development, the creation of new job opportunities and a substantial decrease in dependence on imported steel are anticipated. This development is set to benefit customers across various crucial industrial sectors, such as pipelines, shipbuilding, rig manufacturing, offshore platform fabrication, and tank and pressure vessel manufacturing. In addition, its primary objective would be to cater to the needs of the construction, renewable energy, and marine industries.
In a move that is in line with the Public Investment Fund's (PIF) overarching strategy, the organization has made an investment that aims to tap into the potential of burgeoning sectors and strategically significant industries. This investment is seen as a crucial step towards fostering economic diversification at the local level. The initiative aims to bolster several key sectors identified by the PIF that are in need of steel plate materials while simultaneously strengthening the steel industry in the region.
The steel plate complex receives support from the Kingdom's Shareek program, an initiative designed to promote collaboration between large companies in the private and public sectors. The program's primary objectives include stimulating job creation, boosting the Saudi economy, and encouraging domestic investment by offering attractive incentives. The initiative is part of Aramco's Namaat program, a strategic endeavor aimed at fostering partnerships that will contribute to the economic growth and diversification of Saudi Arabia. The program focuses on driving investment in the country's supply chain and industrial sectors, with the goal of expanding and strengthening these areas.
