NKK Corporation announced today that the company, in a consortium with Tomen Corporation, has received an order to manufacture and provide engineering services for steelmaking facilities from Alexandria National Iron & Steel Co. S.A.E. (ANSDK), Egypt's largest directly-reduced iron (DRI)-based integrated steelmaker. The new facilities will be part of ANSDK's US$650 million flat steel project that will mark the beginning of Egypt's wide steel strip production.

The NKK team won the contract in an international bid held at the end of 1997. NKK will be responsible for the design, manufacture and supply of a 160-ton electric arc furnace, a 160-ton ladle furnace and associated facilities, as well as supervisory services for installation and start-up of the facilities.

Scheduled to go into commercial operation in 2000, the NKK-supplied steelmaking plant will enable production of one million tons of crude steel a year, to be manufactured into steel strips through hot rolling.

ANSDK, an Egyptian-Japanese joint venture, was established in 1982 as Egypt's first DRI-based integrated steelworks. Beginning operation in 1986, ANSDK has steadily expanded production of its core steel bar and wire rod products and won a special commendation for management excellence from the International Finance Corporation. The NKK-Tomen consortium won its latest contract based on its involvement from the initial stage in the supply of steel mill facilities and management consulting services for the operation of the steelworks.

Egypt's domestic flat steel production averaged 560,000 tons a year between 1990 and 1995, with demand forecast to increase to 1.73 million tons annually in 2005. Under its fourth 5-year economic development plan begun in July 1997, the country is implementing an industrial promotion policy through further privatization.

In view of the rapidly growing demand estimates in Egypt, the Japan International Cooperation Agency (JICA), under the leadership of the Japanese and Egyptian governments, conducted studies of Egypt's prospects for flat steel supply/demand and the feasibility of plant construction. The latest steelmaking plant project followed as a result of those studies. ANSDK's flat steel project has also gained domestic attention because it could advance Egypt's industrialization, enabling the nation to move toward independence in flat steel production.