KOTA KINABALU – Singapore’s Esteel Enterprise Pte Ltd will be investing over RM19 billion in Sabah to establish a steel-making plant called the Green Steel Project.
The company via its Sabah subsidiary, Esteel Enterprise Sabah Sdn Bhd (Esteel Sabah), today signed a lease agreement with Sabah Oil and Gas Development Corp Sdn Bhd (SOGDC) here to establish the plant.
The plant will be constructed within Sipitang Oil & Gas Industrial Park (Sogip), 133km southwest of here.
The signing ceremony took place on the sidelines of the Sabah assembly sittings here today and was witnessed by Chief Minister Datuk Seri Hajiji Noor.
Representing SOGDC during the signing were its chairman Datuk Seri Abdul Rahman Dahlan and chief executive and managing director Datuk Harun Ismail, while Esteel Sabah was represented by managing director Xu Yihang, as well as fellow managing director and company director Eng Shao Wei.
“The Green Steel Project was initiated to develop the whole green steel industry chain, which includes iron ore concentration, palletising, direct reduced iron (DRI), steel-making, steel rolling, and high-end steel processing.
“The plant uses natural gas as a reducing agent instead of coke and coal, which reduces carbon emissions by 70% and is low carbon, efficient, and environmentally friendly.
“In the future, it will gradually transform to green hydrogen smelting with near zero carbon emissions,” SOGDC said in a statement, today.
It notes the steel industry is the world’s largest carbon emitter, accounting for about 8% of the world’s total emissions, adding however that there is plenty of room for reduction.
“The Green Steel Project is a three-phase project with a total projected investment value of US$4.39 billion (RM19.6 billion),” it said.
It is seeking to construct an integrated green steel industry occupying 180.5ha of land for Phase I of the project inside Sogip, an industrial area for downstream oil & gas in Sipitang district.
Phase I of the project will produce 2.5 metric tonnes per year (mtpy) of hot briquetted iron (HBI) and will consist of multiple facilities such as an iron ore concentration plant, palletising plant, HBI plant, jetty, support facilities, and others.
Phase I of the project commences in the fourth quarter of 2023 and is expected to be completed by the fourth quarter of 2025, with an investment value of US$1.29 billion.
Upon completion Of Phase I, Phase II and III will have another two sets of DRI, 2.5mtpy each, and will include steel-making, steel rolling, high-end steel processing, waste recycling, and others.
The construction of Phases I and II will be carried out simultaneously, taking about four years.
“The project is expected to generate a huge economic spin-off to the local communities through the creation of 10,000-15,000 job opportunities during the construction period and 1,752 during the operation period for Phase I alone, boosting another 8,000 indirect job opportunities.
“While Phases II and III create 5,455 job opportunities during the operation period, boosting 30,000 indirect job opportunities,” it said. – The Vibes, November 30, 2022
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