Economy, Business And Markets

New DRI Plant to Produce 1m Tons of Sponge Iron

New DRI Plant to Produce 1m Tons of Sponge IronNew DRI Plant to Produce 1m Tons of Sponge Iron

First Vice President, Es’haq Jahangiri inaugurated a direct-reduced iron (DRI) production plant with annual production capacity of 1 million metric tons in Bardsir in the southeastern province of Kerman on Monday.

Jahangiri attended the inauguration ceremony as part of his one day official trip to Kerman province, heading a ministerial delegation including Minister of Industry, Mine, and Trade Mohammad-Reza Nematzadeh; Minister of Cooperation and Social Welfare Ali Rabiei; Health Minister Hassan Qazizadeh Hashemi; and Energy Minister Hamid Chitchian, IRNA reported.

The high-ranking officials inaugurated more projects during their visit to the province, including a coke and tar manufacturing complex in Zarand county, a number of rug workshops and two hospitals.

“The administration is trying to improve the steel production supply chain by concentrating its development plans on areas where the supplies remain tight, such as direct-reduced iron, said Nematzadeh as part of his speech at the inauguration ceremony.

“The government plans are aimed at reducing steel sector problems regarding water shortage, transportation, and environmental issues,” he added, expressing hope that the steel production chain would be completed by 2016, “so that the entire raw materials produced in the country is used domestically.”

The minister reiterated that the only solution to ending the export of raw minerals such as iron ore and iron ore concentrate is to complete the steel production chain.  

The new DRI factory has been established by Sirjan Iranian Steel Company (SISCO), a subsidiary of the Middle East Mines Industries Development Holding Company (MIDHCO). The factory requires 1.5 million tons of iron ore pellets per year to produce 1 million tons of DRI, also known as sponge iron.

Established with a $104.78 million investment, the factory creates 260 direct and over 1,000 indirect jobs. The sponge iron production unit is the first phase in the SISCO development project aimed at producing 1 million tons of steel ingots by March 2016.

Another project unveiled by the ministers was the coke and tar factory in Zarand county of Kerman province. Coke is widely used in the steel sector as important raw material. More than 4.3 trillion rials ($126 million at market rates) were invested on the factory which has an annual production capacity of 800,000 tons and creates 550 direct jobs and 3,000 indirect employments.    

The administration strongly supports the launch of such manufacturing complexes by the private sector, in line with the 2025 Vision Plan objectives, based on which Iran aims at increasing steel production to 55 million tons over the next decade.