meed-logo

line1 line2 line3
SIGN IN / REGISTER

Aramco steps in to boost Saudi steel potential

10 May 2023

 

As the main engine facilitating Saudi Arabia’s Vision 2030 socio-economic transformation, Saudi Aramco is working to ensure its localisation initiatives meaningfully contribute to the programme.

The company is intensifying its localisation efforts by cultivating an in-kingdom supply chain to not only meet its business requirements, but also create specialised jobs for Saudi nationals.

Local manufacturing is a major element of this strategy, and Aramco has made key investments in the production of steel products – a vital business requirement – as part of its commitment.

SeAH Gulf Special Steel Industries (GSI), a joint venture (JV) in which Aramco is a stakeholder, began constructing a facility in February that will mainly produce steel pipes. The estimated $240m factory is located in the King Salman Energy Park (Spark) industrial facility. When it enters operation in 2025, it will have the capacity to produce 20,000 tonnes a year (t/y) of stainless steel seamless pipes and tubes.

On 1 May, Aramco entered into another JV to establish an integrated steel plate manufacturing complex in Saudi Arabia, which will help “increase localisation of the steel value chain”, according to Fahad M al-Abdul Kareem, senior vice-president of Industrial Services at Aramco.

Ras al-Khair steel complex

Aside from Aramco, the JV that will build the steel-plate production complex includes the kingdom’s sovereign wealth institution, the Public Investment Fund (PIF), and the Chinese steel manufacturing conglomerate Baoshan Iron & Steel Company (Baosteel).

The complex, deemed the first of its kind in Saudi Arabia, will be located in Ras al-Khair in the kingdom’s Eastern Province, which was recently designated as one of four new Special Economic Zones by Saudi Crown Prince Mohammed bin Salman.

The planned facility will have an output capacity of 1.5 million t/y and “serve strategic industrial sectors including pipelines, offshore platforms, rigs, tanks, pressure vessels, shipbuilding and others”, Al-Abdul Kareem tells MEED.

“The complex will bring together Aramco’s unrivalled energy and industrial services ecosystem, Baosteel’s advanced steel plate industry capability and PIF’s investment expertise,” he says.

Engineering, procurement and construction work on the project has been divided into several packages, which will be tendered soon, with a contract award expected by the second half of this year.

The steel complex will be able to start operating with hydrogen fuel without major equipment modifications as soon as the new hydrogen technology is ready
Fahad M al-Abdul Kareem, Aramco

Environmental impact

“This complex aims to be one of the lowest-carbon emissions, large-scale steel plate manufacturing facilities in the world based on currently announced projects,” says Al-Abdul Kareem.

Aramco signed a memorandum of understanding with Baosteel to conduct an engineering and feasibility study for the proposed steel plate complex in September 2021.

The plant will be equipped with a natural gas-based direct reduced iron (DRI) furnace and an electric arc furnace to reduce carbon dioxide (CO2) emissions from the steel-making process by up to 60 per cent compared with a traditional blast furnace, Aramco announced recently.

“The steel complex has also been designed to be hydrogen-compatible as a substitution for natural gas,” Al-Abdul Kareem adds. “It will therefore be able to start operating with hydrogen fuel without major equipment modifications as soon as the new hydrogen technology is ready for application.”

“This would enable the complex to make steel with up to 90 per cent less CO2 emissions than traditional coal-based steel production processes,” he explains.

Economic contributions

The steel plate factory’s workforce is expected to comprise 80 per cent Saudi nationals to meet Aramco’s Saudisation goals, he says. It is also projected to contribute $1.7bn to Saudi Arabia’s GDP every year.

The JV aims to export 30 per cent of its capacity to Middle East and North Africa (Mena) markets. “Through this plant, the kingdom is expected to be able to substitute imports by amounts close to SR4.9bn, or $1.3bn, annually,” says Al-Abdul Kareem.

To maximise its economic potential, the proposed complex will receive support from the Saudi government’s Shareek incentives programme for large companies. It has also been brought under Aramco’s Namaat local industrial investments programme.

“This project has the potential to create a tangible impact on the kingdom’s economy and contribute to Saudi Arabia’s GDP growth, generate new jobs, support the [In-Kingdom Total Value Add] iktva programme targets by adding to the local content production and lead to considerable import substitution,” the Aramco executive concludes.

https://image.digitalinsightresearch.in/uploads/NewsArticle/10826161/main.gif
Indrajit Sen

Register for MEED's guest program now to access this article.

Click here to register
Exclusive from Meed
Related Articles
  • Decision imminent on Dubai sewerage tunnel contracts

    24 April 2026

     

    A final decision on the first two packages of the flagship Dubai Strategic Sewerage Tunnels (DSST) project is imminent, with two remaining bidders having submitted best and final offers. 

    The AED80bn ($22bn) public-private partnership (PPP) scheme comprises three packages: J, W and Links.

    According to a source, two consortiums led by Etihad Water & Electricity (UAE) and Vision Invest (Saudi Arabia) were recently invited to submit final bids for packages J and W, which were tendered last November.

    The winning consortium is expected to be formally confirmed in the coming weeks once the required approval process is completed, the source said.

    MEED had previously reported that three consortiums were bidding for the project, which is being procured by Dubai Municipality’s sewerage and recycled water projects department.

    These included:

    • Consortium 1: Led by Plenary Group (Australia) alongside Itochu (Japan) and Infrastructure Holding (UAE) 
    • Consortium 2: Led by Vision Invest (Saudi Arabia) alongside Suez Water Company (France)
    • Consortium 3: Led by Etihad Water & Electricity (UAE) alongside Tamasuk Holding (Saudi Arabia) and Alkhorayef Water & Power (Saudi Arabia)

    It is understood that the consortium led by Pleneray Group has since been dropped from consideration for the contract.

    As MEED previously reported, the bid packages include equity partners, an appointed operator and a construction contractor.

    Of the bidders still in contention, MEED understands that Vision Invest plans to act as operator for that consortium, while Suez will lead construction.

    In the other consortium, EtihadWE plans to take the operator role, with construction led by France’s Veolia.

    Large-scale sewerage network

    The DSST masterplan project covers the construction of two sets of deep tunnels terminating at pump stations at Warsan and Jebel Ali Sewage Treatment Plants (STPs). It also includes over 200 kilometres of sewer links.

    Construction work was previously categorised in multiple packages under the Warsan Strategic Tunnel Scheme (Package W) and the Jebel Ali Strategic Sewerage Scheme (J1 North, J2 South, J3 Jebel Ali Links).

    These packages have now been restructured and renamed.

    The bid submission deadline for the third 'Phase 2 Links' package, meanwhile, was recently extended.

    The new deadline is June 30. 

    The three packages are being procured under 30-year design, build, finance, operate and maintain concession models.

    The DSST project aims to convert Dubai’s sewerage system from a pumped network to a gravity-based system, enabling the emirate to replace existing sewage pumping stations and meet long-term capacity needs.

    The programme also marks the first time the municipality will implement In-Country Value (ICV), a local content programme that promotes economic benefits.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/16536060/main.jpg
    Mark Dowdall
  • Dubai scales up its metro ambitions

    23 April 2026

     

    Dubai’s rail sector has rarely seen such a concentrated burst of procurement activity as it has in the past year.

    Within the space of a few months, Dubai’s Roads & Transport Authority (RTA) has moved simultaneously on three distinct fronts: tendering design consultancy for the Route 2020 extension that will connect the Expo 2020 metro station to Al-Maktoum International airport; inviting study-and-design bids for a 55-kilometre Airport Express Line linking Dubai International airport to Al-Maktoum International airport; and culminating in Dubai Ruler Sheikh Mohammed Bin Rashid Al-Maktoum’s approval of the AED34bn ($9.2bn) Gold Line, a 42km fully underground route that the emirate is calling the largest transportation project in its history.

    These projects form a key part of the Dubai Rail Network Plan 2032, which outlines the development of six public transportation schemes comprising a mix of metro, passenger and high-speed rail lines.

    The most prominent feature of the plan is the addition of new lines to Dubai Metro’s existing network, representing a systematic effort to support the shift of Dubai’s economic centre of gravity towards Dubai South and the vast development corridors in between.

    The city is also seeking to stay ahead of the curve by investing heavily in infrastructure. Data from regional projects tracker MEED Projects shows that the emirate has awarded over $14bn-worth of transport projects in the past two years alone, with several other multibillion-dollar schemes still moving through the planning stages.

    All of this work is being carried out in line with the Dubai 2040 Urban Master Plan, which forecasts the emirate’s population will reach 5.8 million by 2040 – a clear indication of the scale of daily movement the city must accommodate.

    Project progress

    Dubai Metro Gold Line

    On 21 April, Sheikh Mohammed officially announced the launch of the new AED34bn ($9.2bn) Gold Line project.

    The line will be a fully underground network spanning over 42 kilometres, with 18 stations.

    It will run from Al-Ghubaiba in Bur Dubai to Jumeirah Golf Estates.

    The Gold Line will connect with Dubai Metro’s existing Red and Green lines and integrate with the Etihad Rail passenger network.

    In October last year, MEED exclusively reported that the RTA had selected US-based engineering firm Aecom to provide consultancy services for the project.

    Stage one covers concept design; stage two, preliminary design; stage three, preparation of tender documents; stage four, construction supervision; and stage five, the defects liability period.

    Airport Express Line

    Procurement has started for another metro line extending from Dubai International airport (DXB) in Al-Garhoud to Al-Maktoum International airport (DWC) in Jebel Ali.

    Earlier this month, the RTA invited consultants to bid for a contract to study and design what is referred to as the Airport Express Line.

    The proposed line will stretch about 55km and include five stations that will provide passengers with facilities such as remote airline check-in, baggage drop-off and security screening.

    The new line will run from the Red Line metro station at DXB through Al-Jaddaf, along Al-Khail Road to a new station at Jumeirah Village Circle (JVC), before continuing on to DWC.

    There will be two spur lines. The first will run from the new JVC station to Al-Fardan Exchange metro station at Emirates Golf Club, while the second will branch toward Business Bay, where another station will be built.

    Expo 2020 route extension

    Dubai is also undertaking the Route 2020 extension of its metro system, which will start from the Expo 2020 metro station and connect with Al-Maktoum International airport’s West Terminal.

    Consultants submitted their bids earlier this month for the design contract.

    The extension will run for about 3km and feature two stations.

    The existing Route 2020 metro link is a 15km line that branches off the Red Line at Jebel Ali metro station. The line comprises 11.8km of elevated tracks and 3.2km of tunnels, and has five elevated stations and two underground stations.

    Dubai Metro Blue Line extension

    Construction progress on the Dubai Metro Blue Line extension is expected to reach 30% by the end of 2026, according to official accounts.

    In December 2024, the RTA awarded a AED20.5bn ($5.5bn) main contract for the construction of the project.

    The contract was awarded to a consortium of Turkiye’s Limak Holding, Mapa Group, also of Turkiye, and the Hong Kong office of China Railway Rolling Stock Corporation (CRRC).

    The Blue Line will connect the existing Red and Green lines. It will be 30km long, with 15.5km underground and 14.5km above ground.

    The line will have 14 stations, seven of which will be elevated. There will be five underground stations, including one interchange station, and two elevated transfer stations connected to the existing Centrepoint and Creek stations.

    The project is scheduled for completion in September 2029.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/16534887/main.png
    Yasir Iqbal
  • Contractors form teams for Bab Gas Cap main plant project

    23 April 2026

     

    Contractors have formed consortiums to participate in the main tendering exercise for a major project involving the development of infrastructure to process incremental gas output arising from the unlocking of gas caps at the Bab onshore hydrocarbons development in Abu Dhabi.

    As part of its 2030 upstream production increase goals, Abu Dhabi National Oil Company (Adnoc Group) is working to extract gas from four underdeveloped gas cap reservoirs at the Bab onshore field development – Thammama A, Thammama B, Thammama F and Thammama H. While the Thammama A, B and H reservoirs are estimated to collectively produce 1.45 billion cubic feet a day (cf/d) of gas, output from the Thammama F gas cap is expected to be at a rate of 396 million cf/d.

    Existing trains at the Habshan processing complex in Abu Dhabi will be unable to handle the new gas volumes. Therefore, Adnoc Group subsidiary, Adnoc Gas, is required to build new facilities to process an additional volume of up to 1.85 billion cf/d of raw gas when its parent company starts production from the Bab gas caps.

    Adnoc Gas is planning to build a gas processing plant in the Bab area, about 170 kilometres from Abu Dhabi, along with associated pipeline networks and other ancillary units, as part of the broader Bab gas cap development project. It has divided the engineering, procurement and construction (EPC) scope of work on the project into four packages:

    • EPC package 1 – Main Bab gas cap plant
    • EPC package 2 – Early civil works
    • EPC package 3 – Pipelines
    • EPC package 4 – Non-process area works

    Abu Dhabi Securities Exchange-listed Adnoc Gas issued an expression of interest (EoI) document to contractors for the main EPC tendering process for the main Bab gas cap plant on 10 February. The company had set an initial EoI submission deadline of 17 February, which it later extended until 20 February, with contractors submitting responses by that date, MEED previously reported.

    Following the completion of the prequalification phase, contractors that expressed interest formed the following teams to compete in the main contract tendering round, according to sources:

    • Larsen & Toubro Energy Hydrocarbon (India) + Samsung E&A (South Korea)
    • Saipem (Italy) + NMDC Energy (UAE)
    • Technip Energies (France) + JGC Corporation (Japan) + Sinopec (China)
    • Tecnimont (Italy) + China Petroleum Engineering and Construction Corporation (CPECC)

    Adnoc Gas is expected to issue the main EPC tender for the central Bab gas plant in May, sources told MEED.

    The other three packages remain in the main contract tendering stages, the sources said.

    Prior to issuing the EoIs for the Bab gas cap development project packages, Adnoc Gas completed an early engagement process with contractors in September and October last year, as MEED previously reported.

    In December last year, Adnoc Gas awarded the front-end engineering and design (feed) works for the Bab gas cap development project, which will increase its gas processing capacity by about 20%, to Australia-based consultancy Worley. The feed contract has a duration of more than 1.2 million man-hours, making it the largest-ever engineering job awarded by Adnoc Gas.

    Adnoc Gas currently has a capital expenditure (capex) commitment of $20bn for the 2023-29 period, which is on course to increase to about $28bn as the company strives to achieve final investment decisions (FID) on the second and third phases of its rich gas development programme this year.

    The first phase of the RGD project is under construction. Adnoc Gas awarded $5bn-worth of engineering, procurement and construction management (EPCm) contracts in three tranches for phase one of the RGD last June – the company’s largest-ever capital investment.

    The second and third phases involve building a natural gas liquids fractionation train at the Ruwais gas processing facility and a new gas processing train at the Habshan complex, respectively, Peter Van Driel, the company’s chief financial officer, had earlier told journalists on a call.

    MEED, in March, reported that Adnoc Gas had selected main EPC contractors for both the Ruwais NGL Train 5 and the Habshan 7 gas processing train projects, which are estimated to be valued at around $4bn each. Adnoc Gas is yet to officially award the EPC contracts for the two projects.

    Adnoc Gas’ capex commitment could exceed $30bn when the company achieves FID on the Bab gas cap development project, which is currently expected later this year, Van Driel previously said.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/16534391/main0115.jpg
    Indrajit Sen
  • Sports Boulevard tenders Wadi Hanifa road works

    23 April 2026

     

    Register for MEED’s 14-day trial access 

    Saudi Arabia’s Sports Boulevard Foundation has issued a tender inviting firms to bid for a contract to build a road and associated infrastructure in the Wadi Hanifa area of Riyadh.

    The bid submission deadline is 27 April.

    The scope includes construction of an 11.4-kilometre road and associated infrastructure, including public realm works, utilities and security systems.

    The scheme is the latest package to progress on Riyadh’s Sports Boulevard project.

    The Sports Boulevard Foundation is also evaluating bids for its Global Sports Tower in the development’s Athletics District.

    The 130-metre-tall Global Sports Tower will have a gross floor area of 84,000 square metres (sq m) and will include more than 30 sports facilities. The tower will feature what is billed as the world’s tallest indoor climbing wall, at 98 metres, and a 250-metre running track.

    Sports Boulevard will run across Riyadh from east to west. Once complete, it is intended to be the world’s longest park, stretching more than 135 kilometres.

    The project is divided into multiple districts, including the Wadi Hanifah, Arts, Urban Wadi, Entertainment, Athletics and Eco districts, as well as Sands Sports Park.

    The large-scale development aims to transform central Riyadh – currently dominated by major highways – into a recreational corridor.

    Sports Boulevard will include 4.4 million sq m of public realm and landmark buildings. Along with the Global Sports Tower, there will be a Centre for Cinematic Arts and a 2,000-seat amphitheatre.

    It will also deliver more than 2.3 million sq m of mixed-use commercial, residential and retail space, alongside sports facilities, around the park, known as the Linear Park.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/16534345/main.jpg
    Yasir Iqbal
  • Masdar to develop renewables projects in Montenegro

    23 April 2026

    Abu Dhabi Future Energy Company (Masdar) and Elektroprivreda Crne Gore (EPCG) have agreed to establish a 50:50 joint venture to develop and operate renewable energy projects in Montenegro.

    The planned projects include solar photovoltaic (PV), wind, hydropower, pumped-hydro storage and battery energy storage systems.

    The joint venture will be headquartered in Niksic in western Montenegro and is intended to support Montenegro’s domestic energy needs while also enabling the export of renewable electricity to the Western Balkans and Southern Europe, Masdar said in a statement.

    The companies plan to leverage an existing sub-sea interconnection with Italy. Montenegro is connected to Italy via a 600MW HVDC submarine cable, enabling electricity exports to the Italian market.

    Masdar has an existing presence in Montenegro through its investment in the 72MW Krnovo wind farm.

    The developer has recently accelerated foreign investment plans as part of its broader expansion. In April, it signed a binding agreement with France’s TotalEnergies to establish a $2.2bn joint venture to develop, build and operate renewable energy projects across Asia.

    The combined business will have 3GW of operational capacity and 6GW of projects in advanced development, targeted for commissioning by 2030.

    Masdar is targeting a global renewable energy portfolio of 100GW by 2030. It recently reached 65GW, two-thirds of the way to that target.

    The company plans to deploy an additional $30bn-$35bn in equity and project finance by 2030, adding an average of 10GW of new capacity each year.

    This expansion will be funded through a mix of equity, green bonds and long-term project financing.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/16534112/main.jpg
    Mark Dowdall