Libyan steel maker sees slight output rise

December 25, 2013 - 7:37:22 am

A worker operates a furnace at Libyan Iron and Steel Company (Lisco) in Misrata yesterday.

MISRATA: The Libyan Iron and Steel Company (Lisco) is planning slightly higher overall production next year, its chairman said, but shortages of electricity and gas will continue to disrupt its recovery following the country’s civil war.

Chairman Mohamed Abdelmalik Al Faqih said that despite problems in producing base liquid steel, the company would expand its capacity in finished products in 2014, and was seeking a new market in Algeria while demand in Egypt and southern Europe remains weak.

State-owned Lisco, one of North Africa’s biggest steel makers, was launched under Muammar Gaddafi as Libya tried to diversify from oil exports. It shut down operations during the 2011 Nato-backed uprising which ousted Gaddafi and resumed production last year.

Faqih said Lisco, which is one of Libya’s biggest corporations, would continue to face problems in the new year.

“Overall production is improving,” he said in an interview. “We have a production plan for the coming year ... forecasting a slight increase.”

“But we’re still facing many challenges, most importantly a shortage of power capacity and also natural gas,” he added.

Power cuts have hit Tripoli and other major cities as militias and tribesmen demanding higher pay or more political rights have blocked gas pipelines, oilfields and seaports to press their demands. 

These have hampered Lisco’s production this year, forcing the shutdown of a melt shop — where liquid steel is produced — for almost a month in September.

“From May until now we have been suffering from power capacity or gas problems,” Faqih said in the interview, conducted on Sunday. Lisco has operated only one or two gas plants throughout the year, leaving its third standing idle.

“Based on discussions with the power company it seems the problems of power shortages will continue next year,” he said, adding that during night shifts the restarted melt shop was  operating only two of the five furnaces.

In 2012 the plant, which has a maximum capacity of 1.6 million tonnes, aimed to produce just over 1 million tonnes yet managed only 350,000, company officials said earlier this year. This was due to technical problems and the reluctance of foreign experts to work there due to Libya’s insecurity. 

Next year Lisco plans to produce 1.1 million tonnes of liquid steel. Faqih said the plant’s melt shop 1 would produce 650,000 tonnes, up from around 400,000 tonnes in 2013 which was 70 percent of the firm’s original plan. 

The melt shop 2 is planned to produce 450,000 tonnes next year. He gave no overall output figure for 2013, but said it was working at slightly below 60 percent of the target.

Lisco, located in the central port city of Misrata, aims to continue with a 3bn Libyan dinar ($2.44bn) expansion plan dating from the Gaddafi era.

Reuters

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