Mega Steel Plant in Indonesia Faced with Construction Delay

SEATTLE (Scrap Monster): The Chinese Delong Holdings Limited has announced delay in operational status of mega steel project in Indonesia. A press release issued by the company stated that the plant under construction in Indonesia’s Morowali Industrial Park will become fully operational by end-June next year. Initially, the plant was expected to be completed for operations by end of 2018.

The Board of Directors of the company declared that the delay in completion of the steel plant is due to couple of factors. Firstly, there has been a delay by the suppliers in the delivery of the plant and equipment. The second reason cited for the delay is the shortage of steel-related skilled labor for executing the project. All parties involved are working together to address the above issues, which it believes will be sorted at the earliest, the company press release said.

The joint venture, Dexin Steel Indonesia was proposed in June last year, with Delong Holdings, Indonesia Morowali Industrial Park and Shanghai Decent Investment Group as JV partners. Delong’s subsidiary, Delong Steel Singapore Projects owned 45% stake in the joint venture. Shanghai Decent and Morowali held 43% and 12% stake respectively. The JV had proposed initial investment of around $950 million.

The steel plant in Central Sulawesi, Indonesia is expected to have production capacity of 3.5 million tonnes of steel products, mainly bars, wires and slabs. This is Delong’s first project in Indonesia.