Chinese equipment supplier Sinosteel has clinched a contract worth $508 million for the construction of a new steelworks near Algiers, Algeria, for the Turkish company Tosyali, said a report.

The new mill will have a capacity of 2.3 million metric tons/year, stated Platts, a leading global provider of energy and commodities information, citing a senior company executive.

Tosyali already has an EAF-based steelworks located in the region of Oran, western Algeria, with the capacity of 1.2 million MT/year of crude steel, the mill serves the domestic construction market which remains highly dependent on imports from Europe.

A ground-breaking ceremony is likely to be held this month.