New pipe factory to help Empower save 6% costs

Empower will save five to six per cent in its overall costs once its pre-insulated pipe factory begins operations in March.

The firm, jointly owned by Dewa and Tecom Investments, will get 20 per cent of its pipe requirements from the factory it has built together with Denmark's Logstor.

Ahmad bin Shafar, CEO of Empower, said the factory called Elips, short for Empower-Logstor Insulated Pipes Systems, is 99 per cent complete. The plant can manufacture up to 80-inch or 2.5 metres pipe and has a capacity to produce 1km of pipes (100 pipes) per day.

The plant will service district cooling and oil and gas businesses across the GCC and Southern Middle East such as Iraq and Iran.

According to previous media reports, quoting officials, the plant was originally planned to be completed in 2008. But Bin Shafar denies this and said the opening was delayed only by 20 days.

Bin Shafar said the plant, which took about 12 months to build, will be profitable in the next two to three years. He said through Elips, Empower will be saving between 15 and 25 per cent on the cost of pre-insulated pipes, which make up about 20 per cent of the firm's total expenditures.

"Empower decided to enter this joint venture with an eye on securing the supply chain of pre-insulated pipes used in district cooling services networks which constitute 20-25 per cent of our total capital investment," Bin Shafar said.

"The facility will ensure timely delivery and installation of pipe networks that will have a major impact on Empower's project timelines."

Tolstrup said: "We believe UAE's economy is in good hands, and our outlook on the future is optimistic. Logstor's aim is to serve the Gulf through Dubai, which has strong infrastructure and logistical connectivity."

The plant was inaugurated yesterday by Sheikh Mansoor bin Mohammed bin Rashid Al Maktoum and Denmark Crown Prince Frederik Andre Henrik Christian

Keep up with the latest business news from the region with the Emirates Business 24|7 daily newsletter. To subscribe to the newsletter, please click here.

Follow Emirates 24|7 on Google News.