General Steel Holdings Inc announced that it will test run two newly constructed 1,280 cubic meter blast furnaces, two 120 tonne converters and one 400 square meter sintering machine at its Longmen Joint Venture.

At their designed efficiency levels, the new equipment has the potential to increase production capacity for the company by 3 million tonnes of crude steel per year.

Mr Henry Yu chairman & CEO of General Steel said “We are pleased to bring the new state of the art equipment online, as it marks a milestone for us in terms of the expansion of our production capacity. We have successfully transitioned to new state of the art equipment which meets governmental industry standards. The new equipment will reduce our costs and improve our profitability, and the increased production capacity will place us in an advantageous position as we strive to meet the increasing demand for our steel products in China’s Western regions.”

The construction of the new equipment was funded by the Shaanxi Iron and Steel Group.

General Steel is currently in negotiations with Shaanxi Group to enter into a lease agreement whereby General Steel will lease the new equipment. During this test run period, General Steel will be able to use the equipment to produce and deliver products to its customers. It is anticipated that this test run period will continue until a lease agreement between Shaanxi Group and General Steel is finalized.