Arabian Gulf Steel gets key sustainable financing from Mashreq
One of UAE's largest private sector steel makers, ASGI is also a recycler and a recognised leader in low emission steel production. Its operations are fully based on local recycled raw materials and powered mostly by renewable energy.
The transaction will further support AGSI's sustainability agenda and enable the company's transition toward cleaner industrial practices in line with UAE Vision 2030.
As one of the UAE's first steel producers to secure a green facility tied to emissions goals, AGSI is setting a precedent for how industrial players can integrate environmental performance into their financing strategy.
AGSI's carbon neutrality was verified by DNV, leading global assurance and certification firm, confirming emissions of 0.13 tonnes of CO₂ per tonne of crude steel. Looking ahead, the company plans to produce 5 million tonnes of green steel by 2030 and aims to cut emissions by 95 percent compared to traditional steelmaking.
The facility will fund environmentally friendly projects focused on improving production efficiency to help AGSI meet these targets. It will also accelerate the adoption of green technologies, with cost savings expected over time through better energy use and reduced operating expenses.
Joel Van Dusen, Head of the Mashreq Corporate and Investment Banking Group, said: "AGSI is setting a benchmark for low-emission steel production, and we are pleased to provide a financing solution that enables them to scale their efforts. Responsible finance is a business imperative for Mashreq, and we are focused on delivering structures that help our clients lead that transition with confidence."
Steel industry is currently responsible for 7% of total global CO₂ emissions. This facility represents a significant step forward for green finance in the Middle East, applying sustainable funding to a sector that is traditionally difficult to decarbonise.
Faisal AlShimmari, Head of ESG at Mashreq, said: "This transaction reflects a broader shift taking place across the region's industrial sector, where more companies are using finance as a strategic tool to meet their sustainability goals."
It is the latest addition to Mashreq's pledge to facilitate $30 billion in sustainable finance by 2030.
"Steelmaking remains one of the most resource-intensive industries globally, and AGSI is among the first in the UAE to secure a green facility that directly supports its decarbonisation efforts," stated AlShimmari.
"This deal also reinforces Mashreq's leading role in driving sustainable industrial growth in the UAE and the region by aligning finance with tangible environmental outcomes," he added.
Asam Hussain, founder and CEO at AGSI said: "Securing this facility reflects both the strength of our business model and the growing confidence in industrial sustainability as a viable path forward. Our partnership with Mashreq marks an important step forward in our growth journey and our shared commitment to a low-carbon future."
"It gives us the momentum to keep moving forward, scaling responsibly, and continuing to deliver real value to the UAE's green economy," he stated.
The company has achieved net zero carbon emissions per tonne of steel and remains committed to carbon neutrality through 2035 and beyond.
By 2030, AGSI aims to produce 5 million tons of low-carbon steel while maintaining a 90% reduction in emissions compared to traditional steelmaking. The company has already eliminated more than 7.28 million tons of carbon dioxide emissions through its current production model.- TradeArabia News Service
Copyright 2024 Al Hilal Publishing and Marketing Group Provided by SyndiGate Media Inc. (Syndigate.info).
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