Senaat in JV with Japanese partners to set up pipe manufacturing in Abu Dhabi

Senaat, one of the largest industrial holding companies in the United Arab Emirates, entered into a joint venture, in which it will hold a 51 percent share, with a consortium of two of Japan’s leading companies in the steel sector, JFE Steel Corporation and Marubeni-Itochu Steel Inc (MISI), to establish Al Gharbia Pipe Company which will manufacture and sell large diameter high quality sour grade steel pipes that cater to the Construction and Energy sectors in the region. With operations expected to formally launch in 2018, Al Gharbia’s production capacity is set to reach 240,000 tons annually, around 40 percent of which will be exported to neighbouring markets in the GCC and greater Middle East as well as north and East Africa.

Led by a growing energy demand and increasingly stringent quality specifications as well as an industry heavily dependent on imports, Al Gharbia will address the largely unmet demand for high-quality steel pipes. Once operational, Al Gharbia will join the ranks of only a handful of other companies in the world capable of producing products of similar scale and quality. Sour grade pipes are designed to prevent corrosion associated with hydrogen sulphide environments, a characteristic of offshore operations.

Commenting on the new venture, Eng. Suhail Mubarak Bin Athaeeth Al Ameri, CEO of Senaat, said: “In striving to uphold our mandate of championing UAE industry and contributing to the nation’s diversification efforts Senaat will continue to expand its portfolio through global partnerships with leaders in their respective fields. The project not only meets a stringent demand at a time where being efficient in the oil and gas and other industries is more important than ever; but it is also symbolic of the strength and the calibre of the relationships that we are able to forge. Senaat has an established track record in bringing international know-how to the UAE and building local companies that can compete globally and Al Gharbia attests to that.”

With a total investment close to AED 1.1 billion, the new company will leverage JFE Steel’s know-how for high-quality large-diameter welded steel pipes, MISI’s sales networks and Senaat’s presence in Abu Dhabi, which is looking to drive the contribution of the manufacturing sector in GDP up to 25 percent by 2030. Al Gharbia will be located at Khalifa Industrial Zone of Abu Dhabi (KIZAD).

Through strategic partnerships and investing in industrial assets in Abu Dhabi, Senaat aims to develop a world-class steel cluster in Abu Dhabi and strengthen its steel manufacturing capabilities on par with global peers. Senaat has recently announced its plans to invest AED 5 billion in developing industrial projects over two years.