Rome: Italy’s steel firm Danieli announced on Tuesday that it had signed agreements worth about €5.7 billion in total with Iran.
Danieli, one of the world’s three largest metal industry suppliers, said in a statement that the agreements – that were signed during the visit to Rome by Iran’s President Hassan Rouhani – envisage the establishment of a joint steel production venture with Iran as well as the supplying of machinery and plants to Iran.
The joint venture will be named Persian Metallics and will be made up through an investment of a total of €2 billion by Iranian and international investors.
Persian Metallics will use iron ore and energy to produce about 6 million tons per year of pellets. Danieli added in its statement that the pellets will be intended for feeding direct reduction plants whose product is “an excellent raw material” to produce steel through melting by electric arc furnace. It also emphasized that the electric arc furnace is the most environmentally friendly and often more competitive way to make steel today.
The group further added that other agreements relating to the supply of machines and plants to produce steel and aluminum will be signed with several Iranian companies for a value of around €3.7 billion.
Rouhani arrived in the Italian capital on Monday morning and will leave for Paris on Wednesday.
He is leading a 120-strong delegation that includes Iranian entrepreneurs as well as the oil and gas minister and other government officials in his two-nation European tour.
Iran plans to quadruple steel production to 55 million tons a year by 2025 to keep pace with demand in its industry and an economy being billed as one of the emerging Next Eleven.
Iran’s biggest mill, also the Middle East’s largest, is currently Mobarakeh Steel Company which produces 7.2 million metric tons of steel per year.
There are also several private steel plants, each under 100,000-ton capacity, scattered around the country.