Al Gharbia Pipe on Sunday finalised an agreement with Abu Dhabi Ports to build a Dh1.1 billion factory in Khalifa Industrial Zone (Kizad).
The deal was announced in March.
Al Gharbia Pipe will manufacture steel pipes for the region’s oil and gas industry, especially for transporting sour gas.
The company is a joint venture between Senaat, a holding company of the Abu Dhabi government, and Japanese companies JFE Steel and Marubeni-Itochu Steel.
Sour gas has high levels of hydrogen sulphide, a highly corrosive and poisonous gas.
A plot of 200,000 square metres has been earmarked for the factory, which is due to open in 2018.
The plant will produce up to 240,000 tonnes of steel pipes a year and create 370 jobs.
Al Gharbia Pipe would reduce the UAE’s reliance on steel pipe imports, while exporting 40 per cent of its production, Senaat executives said in March.
“With the ongoing growth of the oil and gas sector in the region, the demand for high-quality steel pipes is expected to expand steadily,” said Takafumi Nishiuma, the vice president of JFE Steel, on Sunday. “We see huge opportunities in this market and the UAE in particular.”
Jamal Al Dhaheri, Senaat’s acting chief executive, said Kizad’s location and infrastructure would allow Al Gharbia Pipe “to improve delivery time and service to our customers in the region”.
Abu Dhabi Ports’ contribution to the emirate’s economy grew more than 30 per cent last year, according to a study by Oxford Economics and Statistics Centre.
The ports operator – which controls Kizad, Mina Zayed and Mussaffah Port – contributed Dh14.1bn to Abu Dhabi’s GDP last year, up 33 per cent from Dh10.6bn in 2013.
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