Construction of a Factory to Produce Special Steel

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Loan No:	318	Interest Rate:	3%
Beneficiary:	Arab Company for Special Steel	Grace Period:	5 Years
Project Cost:	KD 76.9 Million	Maturity:	15 Years
Amount of Loan:	KD 15.0 Million	Repayment:	21 semi-annual Installments
Date of Loan Agreement:	26/5/1997	First Installment:	5 years following the first disbursement.
Date of Effectiveness:	-

 

 Objectives:

The project aims to produce high quality special steel to satisfy increasing local demand and save foreign exchange as a result of import substitution.

 

Description:

The project is expected to be completed by the end of the year 1998 and consists of the following components:

1 - Equipment and Materials:

Includes the purchase and installation of all the necessary equipment and materials necessary to establish a factory to produce about 140,000 tons/year.

Special Steel plants, composed of the following sections:

1. Raw materials receiving storage and handling section.
2. Steel production section.
3. Rolling section.
4. Electrical distribution section.
5. Utilities and support section.
6. Maintenance and workshops section.

2 - Technical Know-how and Support:

Includes acquiring of patents and technical Know-how, management support studies, training, marketing, project management services, information system and equipment.

3 - Civil Works:

Includes the purchase and preparation of the factory site, buildings construction and other required civil works.

4 - Pre-operation Tasks:

Includes feasibility studies, preparation of tender documents, bid solicitation, negotiations with consultants and contractors and preparation of contracts.

5 - Transportation and Other Preparation:

Including transport facilities inside and outside the plant, fire fighting systems, piping network and all other necessary preparations.

 

Financing:

The Arab Fund loan constitutes 20% of the total project cost. Other funds will be obtained:

KD 4.5 million from the Islamic Development Bank, KD 10.8 million from the revolving deposit account of the Egyptian Central Bank and proposed by the Saudi Arabian Monetary Agency, KD 17.6 million from the National Bank of Egypt in addition to company capital and short term loans to cover the remaining costs.

 

 

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