Deputy head of Dung Quat EZ Authority, Le Van Dung, confirmed yesterday that Guang Lian Steel Viet Nam Company said it failed to arrange funding to continue the project. — Photo bizlive

QUANG NGAI (Biz Hub) — Dung Quat Economic Zone and the central province of Quang Ngai will soon end the Guang Lian Steel-Dung Quat project after contacting its owner, Guang Lian Steel Viet Nam Co Ltd.

Deputy head of Dung Quat EZ Authority, Le Van Dung, confirmed yesterday that Guang Lian Steel Viet Nam Company said it failed to arrange funding to continue the project.

Dung added that EZ and the province will have a working session with the owner to prepare to end the project soon, following enactment of the latest regulation of the amended Investment Law, which came in effect on July 1st.

According to the Dung Quat EZA, the project had applied for five adjustments to its investment licence in nine years.

The project was initiated by Taiwanese steel giant Tycoons, based upon a total investment of more than US$556 million in 2006.

The E-United Group of Taiwan later joined the project, and the two Taiwanese enterprises raised the registered investment amount to $3 billion in 2008 and then $4.5 billion, seeking a manufacturing capacity of seven million tonne per year.

At the beginning of 2012, Japan's second largest steelmaker, JFE Group, signed a memorandum of understanding to conduct a feasibility study on the project with the E-United Group, which has a 90 per cent stake in the project.

However, after two years of studies, the Japanese enterprise cancelled its investment in the steel project. The E-United Group took over the study and reduced the investment amount to $2 billion.

According to Dung Quat EZA, the province had cleared and handed over 337ha, out of 504ha, to investors (73.25 per cent of total land area) with a total budget of VND223 billion ($10.6 million).

In a report from investors, it has carried out $73 million in construction of house blocks for workers, land clearance, walls and pile driving between 2006 to 14. — VNS