Steely resolve

Steely resolve

There is nothing like the buzz of mig welders, accompanied by the sound and sparks of angle grinders, set off by the din of clanking great hammers.

It's true that this cacophony is something of an acquired taste, but to us it signifies that an industry is getting back on it's feet - and doing exactly what you'd expect a plant yard to.

Of course, all too many plant yards are silent in the summer heat, but one place where this is not the case is a new yard belonging to the Kanoo group. Unlike the group's other ventures, the new engineering division is devoted solely to metal fabrication. However, deputy chairman Mishal Kanoo is keen to point out that while opening up to the current oil and gas market is a good plan, the company hasn't turned it's back on construction. "It is still construction. There are different types, whether it is infrastructure, warehouse construction, oil and gas. All of these require steel fabrication. So we haven't exactly moved out from our area of experience or expertise. What we have done is added a new dimension into it" he explained.


While it is certainly the case that the plant can fabricate steel for just about anything, it is also obvious that the main clients are going to be paying with the proceeds of ‘black gold'. At the time of our visit, which was the official opening day, workers were busy using a special welding process to make some pipeline, while elsewhere in the workshop another team were busy chopping metal and bolting together more precision steels for something else that could only belong on a drilling rig.

There is clever equipment here as well. Besides the usual tools, the plant boasts brand-new plasma welding equipment, as well as the latest in cutting technology such as the OmniPro waterjet. There is a variety of other high-ticket items, such as Kingsland fixed saws and other fancy gear. Mishal Kanoo was clear that each machine had been bough for a specific job - the firm had not just piled in equipment because it could get a discount during the ressession. "We'd like to think of ourselves as ‘just in time'" he explained. "Just because I find something 50% of it's original price doesn't mean I should buy it as I'll also be locking away 50% of the value. With things being as tight as they are, we are careful with the equipment we buy." He added that if a machine is utilised and makes money, then it will, of course, be bought.


Situated in the very furthest end of Dubai Industrial City, near the Abu Dhabi border it is harder to imagine a more remote location. Although the word ‘city' is included in the development's name, in fact open desert surrounds the plant and the dusty access road makes it anything but. However, there is strategic value in such a barren place, as Mishal Kanoo assures us: "It is very close to Emirates Road, and though DIC is at a nascent stage of its growth right now, most people are of the belief that you are in the ‘booleylands' out here. We'll see in a few years if it really is."

There is more than one non-freezone industrial estate in Dubai of course. Kanoo points out: "There are three major areas, Al Quoz is one, Al Awir is another and this will become the third. Jebel Ali is another, but unless you are a freezone company there is an issue with that one." He also pointed out that Al Awir is mostly full of business patching up old trucks, and so he was keen to try somewhere entirely new.

We wondered, given the group's large presence in Saudi Arabia why it had chosen to manufacture in Dubai - particularly considering the amount of oil and gas infrastructure in that country. Kanoo replied simply: "Our plan is to fabricate here and ship it out. We have [done fabrication in Saudi] in the past, but now the target is to consolidate all the fabrication here."

Neither does he seem particularly concerned about the competition in what is a fairly crowded sector. With contracts for industrial projects seeming to come up far more often at the moment, and be more lucrative than real estate, there will be established player, as well as those looking to take a slice of the action. However, if Mishal Kanoo is concerned about the opposition he doesn't show it "We'll see in a few months if these competitors really exist!" He added: "With the credit crunch the way it is, courtesy of how the banks are handling the liquidity, which is not very good, we will see how many of these companies can survive."

Original Article on Arabian Business