Samsung Engineering in initial Saudi, Alcoa deal

Samsung Engineering in initial Saudi, Alcoa deal

Deal worth $590 mln to build rolling mill.

February 10, 2011 9:14 by Reuters

State-run Saudi Arabian Mining Co (Maaden) and U.S. company Alcoa signed a letter of intent with South Korea’s Samsung Engineering worth 2.21 billion riyals ($590 million) to build part of a mega aluminium complex.

Alcoa and Maaden teamed up in 2009 to build the world’s largest fully integrated aluminium complex in Ras Az Zawr, on the Gulf coast, fast becoming Saudi Arabia’s mining cluster.

Maaden signed a letter of intent with Samsung which involves engineering, procurement and construction of a rolling mill as well as testing the plant, Maaden said in a statement on the bourse website on Wednesday.

The project would take 32 months to complete, it added.

The statement named the company only as Samsung but an industry source said the deal was signed with Samsung Engineering.

The first phase of the aluminium complex which includes a smelter and a rolling mill would be up and running by 2013 while a bauxite mine and an alumina refinery is set to start by 2014.

The rolling mill would produce 380,000 tonnes annually of aluminium sheets, it said. When Maaden and Alcoa first announced the project they said the mill would have a capacity of up to 460,000 tonnes.

(Reporting by Reem Shamseddine; Editing by Hans Peters)