Benghazi DRI Complex to Draw $2.5 Billion, Start Production in 2028

An industrial complex on Libya's eastern Mediterranean coast is expected to draw roughly $2.5 billion in investment, with commercial production slated to begin in early 2028, the chairman of the Turkish-Libyan joint venture behind the project said.

The plant, located in the port city of Benghazi, will manufacture direct reduced iron (DRI), a steelmaking feedstock that can be produced from natural gas instead of coal, yielding lower carbon emissions than conventional steelmaking routes.

First announced in 2024, the project ranks among the largest economic undertakings in territory held by military commander Khalifa Haftar, who has been the de facto authority in eastern Libya and much of the south since the civil war against the United Nations-recognised government in Tripoli that followed the NATO-backed uprising against Muammar Gaddafi.

Relations between Haftar and Tripoli have improved markedly in recent times, and a growing number of foreign governments have deepened ties with the Benghazi-based authorities they previously shunned. Turkish companies, whose government was a leading backer of the Tripoli administration, have also made substantial investments in eastern Libya across construction and energy.

The Benghazi facility is being built by Tosyali Sulb Steel Industries, a joint venture pairing Istanbul-based steelmaker Tosyali Holding with the Libya United Steel Company for Iron and Steel Industry (SULB).

According to Tosyali Sulb Chairman Ahmed Gadalla, about 90% of the plant's output will be sold abroad, while the complex will also turn out rebar and pipes for the domestic Libyan market.

The site is designed to produce approximately 8.1 million metric tons of DRI each year. Gas supply arrangements have been completed for the first phase, which is expected to yield about 2.7 million tons annually. A dedicated power station is also under construction to meet a large portion of the complex's electricity demand.

The Middle East had been emerging as a significant hub for lower-carbon iron production, though some projects have been thrown into doubt by the Iran war and the associated disruption to shipping through the Strait of Hormuz.

Libya's extensive Mediterranean coastline positions it to supply both African and European markets, Gadalla said, noting that rising operating costs and tightening environmental compliance requirements in Europe are opening up opportunities.