(Yicai Global) Dec. 6 -- Sinosteel Engineering and Technology has won a USD1.1 billion contract to expand the capacity of a large steel plant in Algeria. 

Sinosteel Engineering will be the general contractor for the fourth stage of a plant belonging to Tosyali Iron Steel Industry Algerie, the Chinese firm said on Dec. 3. It will build a new direct reduction iron workshop with an annual capacity of 2.5 million tons, an electric steel mill, and a hot continuous rolling production line.

Work on the iron workshop will last 30 months starting from the day the contract comes into force, while the mill and production line will take 24 months to complete, Sinosteel Engineering said. 

The contract’s value equals about 47 percent of Sinosteel Engineering’s operating revenue last year, the Sinosteel unit noted, adding that this project is expected to have a positive impact on its business development and growth in the next three years. 

Founded in 2007, Tosyali is one of Algeria’s largest iron and steel companies. Sinosteel has been contracted to design and build capacity expansion projects for Tosyali since 2015. It earned about CNY1.2 billion (USD188 million) from thes e projects between 2018 and last year.

Shares of Sinosteel Engineering[SHE: 000928] closed 0.7 percent down today at CNY8.72 (USD1.37), after earlier jumping by as much as 5.4 percent. The benchmark Shenzhen Component Index lost almost 1 percent.

Editor: Futura Costaglione