Bahrain-based Foulath is building a new pelletisation plant and has plans to set up an integrated steel plant in the Hidd industrial area, in a bid to enhance its role as an iron pellet supplier and assume a new position as a provider of steel products.

The new pelletisation plant, under construction adjacent to an existing one in Bahrain, is being built by Foulath through Gulf Industrial Investment Company (GIIC), which it fully owns. Kobe of Japan is the main construction contractor for the $600 million plant which will have capability to produce 7 million tonnes annually. Completion is set for late 2009.
The existing GIIC pelletisation plant has capacity of 5 million tonnes per year.
Foulath, owned by Gulf Investment Corporation (50 per cent) and by Qatar Steel and MA Al Khorafi and Sons Company (25 per cent each), also intends to set up the integrated steel plant near its pelletisation facilities. 
United Iron and Steel plant, as it is known, is an integrated direct reduced (DR) iron factory with annual capacity of 1.6 million tonnes and an investment of $1.6 billion.  Featuring a steel melting unit and a rolling unit for the production of heavy and medium sections, it will use 2.4 million tonnes of pellets.  The plant is set for commercial operations in 2011. Foulath has a 51 per cent share in the venture with the remainder stake held by Japan’s Yamato group.
While iron producers worldwide are facing a bleak period due to the slowdown in the global economy, Foulath expects prospects to brighten by the time the DR iron plant gets going in Bahrain.
In 2008 GIIC supplied 3.5 million tonnes of pellets to Qatar, Saudi Arabia and the Far East with Saudi Arabia’s Hadeed receiving 1.2 million tonnes and Qatar Steel 600,000 tonnes..
Apart from the new pelletisation plant in Bahrain, Foulath is also set to begin on three other such facilities, two in Egypt and one in Oman.
Each of the planned Egyptian pelletisation plants – one in Alexandria and the other south of Suez – will have an annual capacity of 7 million tonnes. The enterprise will be a joint venture between Foulath and Egyptian companies and investment for each will be $700 million.
Foulath’s Oman pelletisation plant will be built in the Salalah Free Zone as a joint venture with JFE Steel Corporation and have the same capacity as the Egyptian plant. JFE will take a 40 per cent stake in the $700 million venture and also half the output.
Foulath is confident that the pellets it produces will find a market as international demand for DR iron will grow in course of time. In the Gulf, Abu Dhabi’s Emirates Steel Industries is building a DR iron plant in 2009 for which GIIC will supply 05 million to 1 million tonnes of pellets annually and in Oman Shadeed Iron and Steel Company is also in the process of completing its own plant for which GIIC will be a supplier.
From the additional capacity it is creating, GIIC also plans to supplier larger quantities to existing customers like Hadeed and Qatar Steel as well as customers in India and the Far East.