The United Arab Emirates is buying a U.K.-based industrial equipment maker to build a $1.3 billion factory, raising hopes that the UAE will be one of the world’s largest industrial players in the coming years.
The company, Eagle Industrial, is in talks with Qatar’s state-owned industrial conglomerate, Doha Petroleum, according to people familiar with the matter.
Eagle will supply a range of equipment to Qatar, including power generation, transmission, power distribution, industrial equipment and more, the people said.
Qatar’s government is keen to boost its economy as its government struggles with a crippling economic crisis.
A senior Emirati official told Recode that Eagle will invest about $2 billion in the project.
Eagle will operate the plant, which will have a capacity of about 1 million tons of CO2 equivalent annually, according a document seen by Recode.
Qatar’s state oil company, Dohuk Petroleum, is building a $7.5 billion refinery and oil refinery in the UAE’s eastern city of Ras Al Khaimah.
The UAE has said that the refinery will produce up to 500,000 barrels per day of oil per day.
Doha is trying to revive its economy after a decade of economic stagnation and is now building a fleet of ships that it hopes will allow the country to get around the world more quickly.
Qatar was one of several countries to cut ties with Saudi Arabia, Bahrain and Egypt in a dispute over the 2022 Winter Olympics.
Saudi Arabia, the UAE and Egypt suspended their ties to Qatar in June, arguing that Doha was not complying with the terms of the 2022 agreement.