Saudi Arabia's National Industrialization Company (Tasnee) expects an ilmenite smelter project in the southern city of Jizan to start commercial production during the first half of 2017, it said on Sunday.

Tasnee said in the bourse statement that the project, which makes titanium slag, is still under testing and trial start-up is expected during the second half of this year.

The firm's CEO told Reuters in November that commercial operations were expected to commence by the third quarter of 2016 and the plant would benefit Tasnee as it would cover almost two thirds of its feedstock needs which it currently imports.

Tasnee's bourse statement said technical work was still ongoing due to the project's large size and the long period of testing required at such plants to meet global safety and quality standards.

It could not determine the project's financial impact "because of the current status of the titanium industry and the period required by the trial start-up".

The project is equally owned by Tasnee and Cristal; itself 79 percent-owned by Tasnee. - Reuters