Announced with great fanfare after its validation at the time of the “Asaba”, this joint venture would, among other things, create jobs, manufacture rail and even eliminate the importation of pipelines that served the oil and hydraulic industry. January 2024: nothing has been done.
During his last visit to Sider El Hadjar, the Minister of Industry and Pharmaceutical Production attended a presentation of the Sider El Hadjar development plan. The Emarat Dzayer Steel (EDS) project, an Algerian-Emirati partnership that has been dragging on since March 28, 2018, the date of its validation by the Council of State Participations (CPE), was cited as a blocking factor for the development of the complex.
Several projects that EDS was supposed to carry out saw little light of day six years later. “The projects cited in the presentation are dependent on the termination of the Emarat Dzayer Steel (EDS) partnership contract, which was supposed to develop the same range of products, but without success since 2018,” we read in the exhibition document, in which the local authorities also took part.
Announced with great fanfare after its validation at the time of the “Asaba”, this joint venture would, among other things, create jobs, manufacture rail and even eliminate the importation of pipelines that served the oil and hydraulic industry.
January 2024: nothing has been done. “Under the magnifying glass, this partnership is much more in favor of the foreign partner than of Algeria,” analyze several economists. The Sider Group and Emarat Dzayer Group (EDG) had the approval of the State Participation Council for the creation, in partnership, of a 51/49 mixed company whose project cost was estimated at 1.16 billion euros.
Financed 30% from equity and 70% from bank loans, at an interest rate of 3.5%, this new complex, called Emarat Dzayer Steel, is installed within the Sider El Hadjar complex in Annaba. Amounting to 812 million euros (70%), the credit file was submitted for study to Algerian banks.
As for the rest, i.e. 348 million euros (30%), it was to be contributed by the two partners: 177.5 million by Algeria and 170.5 million by the Emirati partner. “Finally, Algeria provides a credit of 812 million euros via its banks, adds a cash flow contribution of 177.5 million euros, and its foreign partner only contributes 170.5 million euros in a gigantic project of which he is responsible for management.
In the end, Algeria participates with a total of almost a billion euros and Emarat with 170 million. Why then do we not call on Chinese companies, notably Sonatrach’s suppliers, to make it a win/win partnership on all levels? If necessary, Sider El Hadjar has priority to benefit from this financial effort to carry out its development plan, especially since it is owned by the Sider group, the partner of the Emiratis,” ask economists.
Impressive figures
In terms of employment and training, this “fictitious” partnership had planned, according to its technical sheet, the redeployment of the entire workforce of the Sider group subsidiary, seamless tube manufacturing (TSS), and the gradual creation of 1,670 new positions. direct work spread over 5 years, and as many new indirect jobs.
The realization of this project had to go through two phases. “The first includes the revamping of the TSS line (14 inches) in order to go from a capacity of 30,000 t/year to 50,000 t/year. The cost is estimated at 3 billion dinars (20 million euros). The completion time is estimated at 14 months.
The acquisition of a merchant rolled line with a capacity of 300,000 t/year and a hot-dip galvanizing bath for a total cost of 11 billion dinars (78 million euros). The completion time is estimated at 16 months.
The acquisition of a line of seamless tubes for a diameter range of 3 to 10 inches, with an annual capacity of 300,000 t for a total cost of 42 billion dinars (300 million euros) and a deadline completion estimated at 20 months,” our sources detail. Since the announcement of the creation of this megaproject, Algeria has still been importing the pipelines.
Its main supplier: is China. According to the technical sheet of this “ghost” project, the second phase consists of the acquisition of a direct reduction module (DRI) with a capacity of 2.5 million t/year for a total cost of 64.4 billion dinars (462 million euros) and an estimated completion time of 36 months.
The DRI produces raw materials to supply the electric steelworks. The surplus must be sold on the national market. The acquisition of an electric steelworks with a capacity of 1.5 million t/year of semi-finished products (billets, blooms, etc.), for a total cost of 28 billion dinars (200 million euros) and a deadline completion estimated at 24 months.
The acquisition of a rolling mill for the production of medium and heavy profiles in the 80-320 mm range with a capacity of 600,000 t/year for a total cost of 14 billion dinars (100 million euros) and an estimated completion time of 24 months.
Once again nothing has been done, apart from the recruitment in 2021 of a foreign business office to support the start of the creation of this stillborn megaproject. Several requests for the termination of this partnership contract with the Emiratis have been transmitted to the public authorities to release the development plan for the Sider El Hadjar complex. A response is still awaited.
