TEHRAN -- Iran's sponge iron output is to exceed five million tons a year as a project for production of 800,000 tons of the commodity through direct reduction will go on stream during the Ten-Day Dawn ceremonies (February 1-11).

Managing Director of Khuzestan Steel Company Ahmad Katani said the Zamzam project' has been fully implemented by Iranian experts but main equipment and control systems have been imported.

Katani told reporters that $45 million, plus rls150 billion was invested in the project.

He said the project will save the country at least 25 million dollars a year.

He added that his company plans to set up a firm with the capacity to produce one million tons of wide steel sheets under $250 million, plus rls1,000 billion investment.

"Moreover," said Katani, "The company is to establish a power plant with a 500 megawatts capacity through resorting to foreign investment."

The Iranian official said his company plans to run with the capacity of producing 14.7 million tons of steel by end of the Third Five-Year Economic Development Plan (2000-2005).

He said his company's share in total steel production of the country is 3.6 million tons currently. Katani added that about eight million tons of steel were imported both last and this years, IRNA reported.