The Economic Coordination Committee’s (ECC) recent decision to allocate gas to National Steel Complex Ltd (NSCL) has rekindled hopes of reviving a steel giant that has remained dormant since its operations were suspended in 2013. Remarkably, the project’s core management team has kept the plant in operational condition throughout the intervening years, preserving its potential for a future comeback.
According to information gathered, investment in NSCL is already substantial despite years of commercial inactivity. The company is estimated to have spent $1.5-2 million annually on maintenance to preserve the plant, on top of the initial capital investment of $350m. Total investment is projected to reach $850m by the time commercial steel production begins.
Ciena Group, a US-based company owned by Pakistani-American Qazi Ashraf, acquired the project in 2022 and has already committed about $420m. An additional $160m will be required for the hot briquetted iron (HBI) plant, while backward integration, including iron ore development and related infrastructure, is expected to cost at least $250m, taking total foreign private investment in the project to approximately $850m.
If all goes according to plan, Pakistan’s first direct reduced iron-based steel plant could resume commercial production by the last quarter of 2027
“It’s difficult to justify an investment of this magnitude in such a challenging project without factoring in both a commitment to Pakistan and confidence in the project’s long-term potential,” remarked Dr Junaid Ahmed, a veteran management consultant.
While hopeful about NSCL’s prospects following the ECC decision, he cautioned that significant hurdles remain. “The project holds tremendous promise, but there can be a slip between the cup and the lip”, he said, pointing to the tedious process of finalising gas tariffs and resolving other regulatory and operational issues before the plant can be fully revived.
The management team in Karachi viewed the ECC’s decision as a light at the end of a long tunnel. “If all goes according to plan, Pakistan’s first direct reduced iron-based steel plant could resume commercial production by the last quarter of 2027. With strong backward and forward linkages, NSCL has the potential to transform the industrial landscape, spur economic activity, reduce steel imports, generate export earnings, and produce high-quality steel from domestic iron ore,” they said in an exclusive conversation.
Investment in NSCL is already substantial despite years of commercial inactivity, with the company estimated to have spent $1.5-2 million annually on maintenance to preserve the plant, on top of the initial capital investment of $350m
Through ownership changes and multiple operational challenges, the core team preserved the project during 13 years of suspended commercial activity, keeping the plant in cold-running condition and maintaining standards validated by performance audits conducted by internationally recognised firms.
The team hopes to move swiftly towards financial close once the gas allocation letter is issued. It explained that installation of the HBI plant, followed by cold and hot commissioning by technology provider Midrex, would take about a year. The HBI plant will produce a premium, high-density and low-reactivity form of direct-reduced iron, widely regarded as a high-quality, low-contaminant feedstock for steel making.
They acknowledged the support of the government and the Special Investment Facilitation Council (SIFC) and underscored the potential to generate up to $1 billion annually in export earnings while substantially reducing Pakistan’s dependence on imported steel in a volatile global market.
The team further revealed that Germany’s DMT Group has been engaged to assess the country’s vast iron ore reserves. According to their study, NSCL would require only about 4m tons of iron ore annually, a fraction of the deposits believed to be available in Pakistan.
Government sources familiar with the project’s progress were equally optimistic. “Ultimately, it is the government’s commitment that matters. This time, the project enjoys strong backing from the SIFC and key decision-makers who recognise that reviving large-scale industrial activity is essential for achieving sustainable growth,” said a senior official on condition of anonymity.
“The successful revival of NSCL could boost investor confidence and demonstrate Pakistan’s ability to rehabilitate strategic industrial assets. It would send a positive signal to both domestic and foreign investors and help attract large volumes of investment that the economy urgently needs,” the source added.
“The ECC decision is expected to be ratified by the cabinet shortly. Once approved, it will set the revival process in motion and galvanise the relevant ministries and agencies to facilitate investors in bringing this industrial juggernaut back to life. The plant has remained idle for far too long, despite its immense potential,” said a member of the government’s economic team.
Mining expert Syed Anwar Hussain described the ECC’s approval of gas supply as a major milestone in NSCL’s revival and expects the cabinet to ratify the decision after the budget session. He credited both government support and the SIFC for maintaining momentum by coordinating federal and provincial stakeholders and helping resolve critical issues.
He highlighted NSCL’s progress in backward integration through the development of domestic iron ore resources in Balochistan. The company plans a 2.4m tonnes per annum beneficiation and pelletisation plant at Port Qasim, supported by ore-processing facilities at mine sites. This integrated model is expected to enhance supply security, lower costs, reduce import dependence, and improve long-term viability.
According to Mr Hussain, mining leases covering about 6,000 acres in Chagai and Bela, combined with Midrex technology, strategic location, and export linkages, position NSCL to become Pakistan’s largest DRI-based steel producer, supporting domestic industry, saving foreign exchange, and generating export earnings through arrangements including an offtake agreement with Japan’s Sojitz Corporation.
To put the developments in context, it is useful to revisit the project’s history. National Steel Complex, formerly Tuwairqi Steel Mills Limited, was set up by Saudi Arabia’s Al Tuwairqi Group. Although the plant successfully completed test runs in 2013, it never entered commercial production because the sponsors and the government failed to agree on a long-term gas supply deal.
A breakthrough came during the government of former prime minister Imran Khan, when the US-based Ciena Group signed a deal to buy TMSL in 2019. The transaction was completed in April 2022, when the management control was formally transferred to the new owners.
Published in Dawn, The Business and Finance Weekly, June 8th, 2026