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Essar ties up with Brazilian firm Vale International for supply of pellets for Saudi steel plant


Vale International, a wholly-owned subsidiary of Vale SA, a leading producer of Brazilian iron ore, has entered into a partnership with the multinational conglomerate Essar Group.

This collaboration aims to supply iron ore agglomerates for the Green Steel Arabia (GSA) project.

Through this partnership, Vale will supply Essar Group 4 million tonnes per annum of iron ore agglomerates (DR grade pellets and briquettes). Operating from facilities in Brazil and Oman, Vale is a leading provider of high-quality raw materials to integrated steel producers worldwide.

Andre Figueiredo, Regional Director, Vale, said the company’s portfolio of high-grade iron ore agglomerates will have a direct positive impact in terms of added value, price competitiveness and a potential lower carbon footprint.

Naushad Ansari, Country Head, Essar Group in KSA, said the company will invest about $4.5 billion in setting up an integrated steel plant in Ras Al Khair, Saudi Arabia.

Through the agreement with Vale and Bahrain Steel, the proposed plant has secured 100 per cent of the raw material supply of iron ore feed for the Saudi steel plant.

To commence production in 2027, the plant will replace flat steel imports into Saudi Arabia and the GCC region with a bouquet of products, he said.

The project consists of a direct reduced iron capacity of 5 million tonnes per annum (mtpa), comprising two modules of 2.50 mtpa each. It will include a 4 mtpa hot strip capacity, along with a 1 million tonne cold rolling capacity, and galvanising and tin plate lines.

The facility will serve vital steel-consuming sectors, encompassing construction, oil & gas, automotive, packaging, and general engineering.

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