From An almost total dependence on imports, from pins to plant, much progress has been made to sustain the oil and gas industry on a local basis in the Middle East in the last 50 years.

Running the length and breadth of the Gulf Cooperation Council (GCC) states are pipelines in refineries, process plants, storage terminals and loading piers. And invariably, each pipe has a flange at both ends.

Flanges are typically made from forgings. For want of significant forging manufacturing facilities in the GCC, such flanges - made of carbon steel, alloy steel, stainless steel or speciality metals and alloys - are imported by the millions from all over the world.

After careful analysis and consideration, Precision Forgings was conceived, with Czech collaboration, to initially cater to indigenous requirements and reduce the need for imports, said a company spokesman.

The plant is under construction on a 30,000 sq m plot in Dammam's Second Industrial City in the Eastern Province of Saudi Arabia, with installation of forging press lines and machining lines currently ongoing.

State-of-the-art equipment and handling facilities have started arriving from Europe which, when erected and commissioned by June next year, will be the only precision forging facility of its kind in West Asia.

The safety equipment under installation at the plant and the procedures adopted in it will, according to the company, meet and, in some instances, exceed statutory requirements. The company's quality policy provides for the implementation of ISO9001:2000 and other international standards such as API, BVQI and standards as may be laid down by its customers.

Other than oil and gas industries and their related downstream petrochemical and basic industries, the other sectors of industrial development are still at the nascent stage. As industrialisation gains momentum, the demand for forgings and/or components machined from forgings will grow.

The promoter - Al Suwaidi Group - has a vision to emerge as the single largest producer of steel forgings in the GCC, while maintaining the highest international standards.

For Precision Forgings - led by managing director Khalid Al Suwaidi - this translates into a corporate mission to be the single largest producer of steel forgings in the GCC, while maintaining the highest international standards.

By meeting these standards, Precision Forgings says it will be well placed to cater to the needs of major oil and gas projects being developed in Saudi Arabia.

''Our initial products will be carbon steel, alloy steel and stainless steel flanges, which find significant application in large oil and gas projects,'' said the spokesman.

''We are confident of having our facilities approved for supplies to such large projects,'' he added.

Added to this will be Precision Forgings' ability to offer competitive prices, proximity and therefore timely supplies.

Thus, the company is hoping to gain 'preferred supplier' status from major oil and gas companies operating in the Kingdom.

From the present modest capacity of 12,000 tonnes per year, the layout already provides for expansion to 30,000 tonnes with only the primary equipment to be sourced. All other infrastructure and attendant facilities are already in place.

This enhanced capacity is foreseen as enhancing company diversification into the automotive, earthmoving, defence, mining, engineering and other allied industries throughout the world.

Such diversity will also offer some protection for the company against the effects of fluctuating oil prices.

''A significant drop in oil prices does dampen flange off take and prices,'' said the spokesman.

''This is, however, offset by large ongoing projects. Since in due course we propose to cater to other industrial sectors, this would help us avoid dependance on products significantly affected by oil price fluctuations,'' he explained.

The Precision Forgings facility will have the best industry-specific talent, with industry-specific experience and exposure in its human resources. The plant will have able support from the Al Suwaidi Group for all other resources, and will be a vehicle for a foray of the Group into the industrial manufacturing sector.

At full production levels, Precision Forgings will be employing around 200 staff. Training programmes have been planned during erection, trial runs and commissioning of the plant, and these will be supported with refresher courses and orientation in new technologies, according to the company.

The initial target markets for the plant will be Saudi Arabia and GCC states.