In accordance with the expansion of its production capacity at the Zenica steelworks in Bosnia-Herzegovina, ArcelorMittal has negotiated a contract with industrial gases giant Messer to provide a supply of oxygen and argon for its increased operation requirements.

ArcelorMittal is in the process of reconstructing the route of the steel production facility at the Zenica plant and the integrated facility would have a production capacity of 1 million tonnes of steel. The complex currently operates an electric arc furnace with a capacity of 800,000 tonnes, producing long products from its downstream facility.

Oxygen required for its current operations is supplied by Messer in tankers from Serbia and Croatia, though from the middle of 2008 Messer will need to cater for Zenica's operations demand of over 15,000 cubic metres of oxygen per hour.

The two companies have developed a flexible concept involving the modernisation of the existing oxygen production facilities and enabling the required oxygen for this development phase to be produced on site, in the short-term. At the same time, a new air separation plant will be built to provide for the full demand of industrial gases from mid 2008 and afford a long-term strategy.

Messer, with over 60 subsidiaries operating in more than 30 countries across Europe, Asia and in Peru, is able to deliver the extreme flexibility required for the project by virtue of its joint venture with Hangyang, the largest Chinese manufacturer of air separation plants.

The agreed contract is thought to be worth around €20m to Messer and the renovation project for ArcelorMittal involves reconstruction of the coke plant, sinter plant, balst furnace, power plant and railroads.