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ALGIERS, Nov 8 (Reuters) - Qatar International, a joint venture by Qatar Steel and Qatar Mining, secured a deal to build, own and operate a $2 billion steel plant in Algeria, state media said, which would help the country meet domestic demand and cut imports.
Qatar International will hold 49 percent and Algerian state firm Sider 51 percent in the plant, which will start production from 2017 with an initial capacity of 2 million tonnes per year and increase to 5 million tonnes over time.
Qatar Steel is a wholly owned subsidiary of Industries Qatar .
The agreement was ratified on Wednesday in Algiers in the presence of Qatar’s Economy and Finance Minister Youssef Hussain Kamal and the Algerian Industry and Investment Promotion Minister Cherif Rahmani, state radio said on Thursday.
“This project will provide an industrial base in our country,” the official APS news agency quoted Rahmani as saying.
The final agreement will be signed in the first half of next month during a visit by Qatar’s Emir Hamad bin Khalifa al-Thani, state radio reported.
The construction of the plant, in the Jijel province in eastern Algeria, is due to start in 2013.
ArcelorMittal, the world’s largest steelmaker, is so far the only steel producer in Algeria, with a 70 percent stake in a plant in the eastern town of Annaba. Sider holds the remaining 49 percent.
The Annaba plant produces around 1 million tonnes of flat and long steel, much less than domestic demand, forcing Algeria to spend about $10 billion on steel imports, according to official figures. (Reporting By Hamid Ould Ahmed; editing by Jane Baird)