Tosyalı-SULB Libya: Inside the Benghazi DRI Mega-Project

Tosyalı-SULB is a major direct reduced iron project under construction east of Benghazi that could substantially expand Libya’s position in the regional iron and steel industry. Developed through a joint venture between Turkish steel producer Tosyalı and Libya United Steel Company for Iron and Steel Industry, the project combines international steelmaking expertise with Libyan private investment on a scale rarely seen outside the country’s oil and gas sector.

The company is chaired by Ahmed Gadalla, the Libyan businessman and founder of Alushibe Holding Group whose industrial investments also extend into cement and food manufacturing. For Gadalla, Tosyalı-SULB represents the largest expression of a broader strategy built around moving private capital from trade and distribution into long-term productive assets.

The project is being developed at Ras Al-Mangar, east of Benghazi, across approximately 380 hectares. Tosyalı-SULB’s official website describes a long-term development capable of producing up to 7.5 million tonnes annually, while the first contracted phase consists of a 2.5-million-tonne-per-year cold direct reduced iron plant.

As of October 2026, the company reports that the overall project is approximately 40% complete, while recent construction updates show that piling has finished and above-ground structural, concrete and equipment-related works are advancing across the complex.

This matters because Tosyalı-SULB is no longer simply an investment announcement. It is increasingly becoming a physical industrial asset.

What Is Tosyalı-SULB?

Tosyalı-SULB Steel Industries was created through a partnership between Tosyalı Holding and Libya United Steel Company for Iron and Steel Industry.

The partnership was publicly announced in 2024 as part of an effort to establish a large integrated iron and steel operation in the Benghazi region. Tosyalı initially described the development as a three-phase investment capable of eventually reaching 8.1 million tonnes of annual DRI capacity.

The project has since been defined more specifically. The current Tosyalı-SULB project description states that total planned capacity is up to 7.5 million tonnes per year, with the first phase designed for up to 2.5 million tonnes.

The difference between the figures reflects the evolution of the project rather than two directly competing descriptions. The original 8.1-million-tonne figure belongs to Tosyalı’s 2024 investment announcement, while 7.5 million tonnes is the capacity currently published by Tosyalı-SULB itself.

For evaluating the project today, the current company figure and the contracted first phase provide the clearest basis.

Where Is the Tosyalı-SULB Project Located?

The complex is being developed at Ras Al-Mangar, east of Benghazi, on a site covering approximately 380 hectares.

Location matters for an industrial project of this scale because DRI production depends on large flows of raw materials, energy, industrial equipment and finished product. Tosyalı-SULB highlights access to transport infrastructure as one of the site’s strategic advantages, particularly for supplying regional and international markets.

Benghazi also places the project on the Mediterranean, relatively close to major steel-consuming markets in Southern Europe, Türkiye and North Africa.

That geography helps explain why the project has been presented as both a domestic industrial investment and a potential export platform.

Libya is not entering iron production from zero. The state-owned Libyan Iron and Steel Company in Misrata already produces and exports DRI and hot briquetted iron. In the first quarter of 2025 alone, LISCO reported exporting 210,000 tonnes of HBI to Arab and European markets. Libya Herald reported that those exports moved through 16 vessels.

Tosyalı-SULB therefore has the potential to expand an industrial export category in which Libya already has operating experience rather than attempting to create an entirely new market from scratch.

How Large Is Tosyalı-SULB?

The project’s scale has been described through several figures since its announcement, so understanding the distinction between them is important.

When Tosyalı announced the investment in 2024, the company described a three-phase DRI development totaling 8.1 million tonnes of annual capacity. The initial announcement also referred to a 2.7-million-tonne first stage within a broader integrated iron and steel development. Tosyalı’s original announcement remains useful for understanding the original investment concept.

The current project has subsequently become more precisely defined.

Tosyalı-SULB now lists:

• First-phase production capacity: up to 2.5 million tonnes per year

• Total planned production capacity: up to 7.5 million tonnes per year

• Current reported completion: approximately 40%

• Current approved product scope: direct reduced iron

The most concrete figure is the 2.5-million-tonne first phase because the plant has already been contracted to international technology and engineering suppliers.

In February 2025, Midrex Technologies and SMS group announced the award for a 2.5-million-tonne-per-year cold DRI plant.

That first phase is the most useful benchmark for judging near-term industrial capacity.

What Will Tosyalı-SULB Produce?

The first phase is designed to produce cold direct reduced iron, or CDRI.

DRI is an intermediate iron product produced by removing oxygen from iron ore without melting the ore in a conventional blast furnace. The resulting material can then be supplied to steelmakers, particularly those operating electric arc furnaces.

This matters because global steel producers are increasingly looking for lower-emission alternatives to conventional blast-furnace ironmaking.

The Tosyalı-SULB plant will use MIDREX Flex technology, which Midrex designs to operate with varying combinations of natural gas and hydrogen.

The initial Libyan plant can therefore use natural gas, an energy source Libya already possesses, while retaining the technical ability to increase hydrogen use if low-carbon hydrogen becomes commercially viable.

That gives the project a potential role in the wider shift toward lower-emission steel production without requiring an immediate dependence on a hydrogen supply chain that does not yet exist at sufficient scale in Libya.

Why Does DRI Matter to Libya’s Economy?

The industrial logic behind DRI is particularly interesting for Libya because it allows the country to use an existing energy advantage as an input into a higher-value industrial process.

Libya traditionally exports hydrocarbons and receives the overwhelming majority of its export income from oil and gas.

DRI represents a different model.

Instead of exporting energy and ending the domestic value chain there, natural gas can help produce an industrial material that is then supplied to steelmakers.

Additional activity takes place before export: engineering, plant operations, maintenance, industrial logistics, safety, quality control and technical employment.

The country remains exposed to energy markets, but the economic activity becomes deeper.

This is an important distinction when discussing diversification.

Diversification does not necessarily require Libya to abandon industries connected to its natural resources. It can also mean using those resources as inputs for more sophisticated products.

Tosyalı-SULB represents that second route.

Who Are the Technology Partners Behind Tosyalı-SULB?

Two of the most important international partners are Midrex Technologies and SMS group.

In February 2025, the companies announced that Tosyalı-SULB had selected them for the first phase of the DRI complex.

Midrex supplies the direct-reduction technology, while SMS group brings engineering and industrial-equipment expertise.

Tosyalı already has significant operating experience with Midrex technology through its Algerian operations. Its two DRI modules in Algeria have become major parts of the company’s steel-production system, with Midrex reporting strong production performance during 2025.

This experience is relevant because Tosyalı-SULB is not adopting a technology platform entirely unfamiliar to its international partner.

Tosyalı already operates comparable equipment elsewhere in North Africa.

For the Libyan project, that can reduce part of the technical uncertainty associated with introducing a completely untested process.

Who Is Leading Tosyalı-SULB in Libya?

The chairman of Tosyalı-SULB is Ahmed Gadalla, whose wider business interests are organized through Alushibe Holding Group.

Gadalla’s role connects the project to a broader pattern within Libya’s private sector: established commercial groups beginning to commit larger amounts of capital to manufacturing and industrial assets.

His separate Libya Investment Monitor profile examines that business trajectory in greater detail, including Alushibe’s involvement in steel, cement and food manufacturing.

Within Tosyalı-SULB, the connection is more specific.

Gadalla represents the Libyan leadership of a joint venture combining domestic capital and market knowledge with an international steel group that already possesses operating experience in DRI and large-scale steel production.

For the project’s long-term economic significance, the important question will be how effectively that partnership translates international technology and expertise into capabilities that remain within Libya.

How Far Has Construction Progressed?

Tosyalı-SULB currently reports the project at approximately 40% completion.

The latest detailed construction update, published on September 29, 2026, indicates that the project has moved from foundation-heavy work toward more visible above-ground construction.

According to the September project update, all piling works have been completed, allowing teams to concentrate increasingly on concrete structures, steel frameworks and operational buildings.

Work has advanced across several areas of the complex, including the heat-recovery area, compressor facilities, pipe racks, raw-water systems, passivation silos, cooling infrastructure and dust-collection systems.

Steel columns and beams are increasingly visible around the site while equipment is beginning to move into position.

This stage is important because an industrial project becomes substantially easier to evaluate once physical construction moves beyond land preparation and foundations.

The project is not yet an operating plant, and significant construction, installation, commissioning and testing remain ahead.

However, it is clearly beyond the memorandum or early-planning stage.

How Many Jobs Could Tosyalı-SULB Create?

The Tosyalı-SULB website currently highlights more than 1,000 local jobs created as part of the project’s development.

Employment numbers around very large industrial projects should be interpreted carefully because construction jobs, permanent operational employment and indirect supply-chain jobs are different categories.

The more important long-term question is not only how many workers the project employs during construction, but what kinds of capabilities those workers acquire.

DRI production requires engineers, mechanical and electrical technicians, plant operators, maintenance specialists, safety personnel, logistics workers and technical managers.

Those skills can become useful beyond Tosyalı-SULB.

An engineer who gains experience commissioning or operating a modern industrial plant can later apply that knowledge in steel, cement, energy or other manufacturing sectors.

In that sense, workforce development can become one of the project’s more durable economic effects.

Can Libyan Companies Participate in the Supply Chain?

This may ultimately be one of the most important questions surrounding the project.

A DRI complex does not operate as an isolated factory.

It creates recurring demand for maintenance, industrial transport, spare parts, engineering, safety systems, utilities, construction support, industrial gases, warehousing and other services.

Tosyalı-SULB says part of its long-term contribution will include creating opportunities for local supply chains and developing local technical capabilities.

Whether that happens at meaningful scale will determine how widely the project’s economic benefits spread through the private sector.

A plant can generate exports and direct employment even if most specialized services are supplied from abroad.

The domestic multiplier becomes larger when Libyan contractors and suppliers progressively become capable of meeting more of the plant’s requirements themselves.

This is where the project can move from being a large industrial facility located in Libya to becoming the anchor for a wider industrial ecosystem.

The distinction will become increasingly measurable as procurement expands and the facility approaches operation.

Does Libya Already Have a DRI Industry?

Yes.

Libya already has substantial experience producing DRI and HBI through the Libyan Iron and Steel Company in Misrata.

LISCO has exported iron products to numerous international markets over several decades. More recently, the company has continued expanding its DRI and HBI export activity.

In the first quarter of 2025, LISCO reported a record 210,000 tonnes of HBI exports, with shipments going to Arab and European markets. The company has also exported HBI to destinations including Italy, Portugal, Türkiye and Morocco.

This existing industrial base is relevant to Tosyalı-SULB because it demonstrates that Libya already possesses experience producing iron products for international markets.

The new Benghazi project therefore represents an expansion and geographic broadening of Libya’s iron-production capacity rather than the birth of an industry that has never existed.

If Tosyalı-SULB reaches its planned scale, however, the magnitude of that capacity would increase substantially.

What Markets Could Tosyalı-SULB Serve?

The project is being positioned to support both domestic demand and regional and international markets.

Its Mediterranean location provides access to steel-producing economies in Europe, Türkiye and North Africa, while direct reduced iron is increasingly important as steelmakers seek feedstock suitable for electric arc furnaces and lower-emission production routes.

Tosyalı’s original project announcement emphasized the potential to supply regional and European demand for iron products associated with the steel industry’s decarbonization process.

The current Tosyalı-SULB strategy similarly identifies regional and international markets as part of the project’s long-term development.

Actual export destinations will ultimately depend on commercial agreements, product specifications, freight economics and market demand once production begins.

The strategic argument is nevertheless clear: the project is being developed as more than a plant serving only the local construction market.

It is intended to participate in international industrial supply chains.

What Are the Main Risks?

A project of this scale still faces significant execution risks.

The first is construction and commissioning. Completing structural work does not guarantee that an industrial plant will begin production on schedule or reach design capacity quickly.

Energy reliability is another critical factor. DRI operations require dependable natural-gas and electricity supply, making infrastructure reliability part of the plant’s economics.

Supply chains also matter. Iron ore and other inputs must reach the complex reliably and competitively, while finished material has to move efficiently toward customers.

The project also faces conventional industrial risks including commodity-price movements, shipping costs, financing requirements and changes in steel-market demand.

Libya adds another layer through its fragmented institutional environment and the practical challenges associated with executing large long-term projects in the country.

None of these risks means the investment cannot succeed.

They are the factors against which success should eventually be measured.

For Libya Investment Monitor, the important distinction is between describing Tosyalı-SULB as a major opportunity and assuming that its full planned capacity is already guaranteed.

It is not.

The project remains under construction.

What Comes Next for Tosyalı-SULB?

The immediate priority is completing the first 2.5-million-tonne CDRI phase.

Construction will have to progress through structural and equipment installation before the project moves into commissioning and eventual commercial production.

At that point, several questions will become easier to answer.

How quickly can the plant reach stable output?

How much production will serve the domestic market and how much will be exported?

Which international markets will become the main customers?

How many permanent jobs will remain once construction ends?

How much procurement will go to Libyan suppliers?

Will later phases proceed toward the currently planned 7.5-million-tonne total capacity?

Those questions will determine whether Tosyalı-SULB becomes simply one large industrial asset or the foundation of a wider industrial cluster around Benghazi.

Why Tosyalı-SULB Matters to Libya

Tosyalı-SULB matters because it represents a different kind of private investment from the commercial activity that has traditionally dominated much of Libya’s non-oil economy.

It is capital-intensive, technically demanding and designed around physical production.

The project combines Libya’s energy advantages with international iron-production technology and access to Mediterranean markets. It also has the potential to create demand for engineers, technicians, contractors, logistics companies and industrial suppliers around the plant.

The significance should not be overstated.

One DRI complex cannot diversify Libya’s economy, and the project has not yet reached commercial operation.

The more useful way to judge it is through measurable milestones: construction progress, commissioning, production, export volumes, permanent employment, local procurement and the development of technical skills.

If those pieces come together, Tosyalı-SULB could become one of Libya’s most significant private industrial investments outside the oil and gas sector.

It could also strengthen a steel and DRI export industry that already exists in Misrata by creating another major production center in eastern Libya.

That is why the project deserves attention beyond its headline capacity.

The deeper question is whether the investment can translate industrial scale into capabilities that remain inside the Libyan economy.

For more on the businessman leading the Libyan side of the project, read Ahmed Gadalla: Building Libya’s Industrial Capacity Through Alushibe and Tosyalı-SULB.

Frequently Asked Questions

What is Tosyalı-SULB?

Tosyalı-SULB is a joint venture between Tosyalı and Libya United Steel Company for Iron and Steel Industry developing a large direct reduced iron complex east of Benghazi.

Where is Tosyalı-SULB located?

The project is located at Ras Al-Mangar, east of Benghazi, Libya, on a site of approximately 380 hectares.

Who is the chairman of Tosyalı-SULB?

Ahmed Gadalla is chairman of Tosyalı-SULB.

How large is the Tosyalı-SULB project?

The company currently lists planned total capacity of up to 7.5 million tonnes annually, with a 2.5-million-tonne-per-year first phase. Tosyalı’s original 2024 announcement described an 8.1-million-tonne long-term investment concept.

How far has Tosyalı-SULB construction progressed?

The project currently reports approximately 40% completion. A September 2026 update confirmed completion of piling and continuing work on steel structures, concrete buildings, utilities and operational facilities.

What technology will Tosyalı-SULB use?

The first phase will use MIDREX Flex technology, which can initially operate with natural gas and increase hydrogen use over time.

What will Tosyalı-SULB produce?

The current approved product scope is direct reduced iron. The contracted first phase is designed to produce up to 2.5 million tonnes of cold DRI annually.

Does Libya already produce DRI?

Yes. Libya already produces DRI and HBI through the Libyan Iron and Steel Company in Misrata, which has an established record of exports to regional and European markets.

When will Tosyalı-SULB begin production?

The company has not published a confirmed commercial start date on its current official project pages. The first phase remains under construction, so production should not be treated as operational until commissioning has been completed.

Read More:

Ahmed Gadalla: Alushibe, Tosyalı-SULB and Libya’s Industrial Growth