Eastern Steel starts work on steel mill in Kemaman

PETALING JAYA (Dec 6, 2011): Eastern Steel Sdn Bhd, a joint venture between Hiap Teck Venture Bhd and China Shougang Group, has commenced construction of the first phase of its RM1.8 billion integrated steel mill in the East Coast Economic Region's Kemaman Heavy Industrial Park (KHIP).

Stage 1 of Phase 1 which costs RM750 million will be completed by mid-2013 and will have a production capacity of 700,000 MT of steel products annually.

Stage 2 will cost an additional RM1.05 billion and will increase the annual production capacity to 1.5 million MT.

"While creating over 2,000 jobs in Terengganu, this steel mill will develop small and medium-sized enterprise clusters to support the heavy industry in the area.

"Terengganu residents can also expect to benefit from the transfer of technical expertise and get a leg up into the growing steel industry," Terengganu Chief Minister Datuk Seri Ahmad Said said in a statement yesterday.

China Shougang chairman Zhu Jimin said: "We see tremendous potential in the steel mill industry in Malaysia and we are very excited as this is Shougang's first steel mill investment outside of China.

"Malaysia is poised to tap into the market with its good business climate and its strategic location between East and South Asia and in the centre of the Asia-Pacific region."

Eastern Steel executive chairman Tan Sri Alwi Jantan said the company has commenced discussions with TATI University College to provide opportunities to local residents and to enable them to participate in the steel industry.

The demand for steel increased in all Asean countries last year with Malaysia taking the lead in the production of crude steel, dominating 29% of regional production.