A European steel manufacturer announced Thursday it is proceeding with plans to build a $1.2 billion advanced, non-grain-oriented electrical steel plant in Mobile County.

The project, originally announced last year, will be under construction later in 2025 and is expected to commence production in 2027, according to Thursday’s press release. It will create 200 permanent new jobs once it is opened, and 1,300 jobs during construction.

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According to the company’s press release, the project promotes U.S. manufacturing “competitiveness and addresses a crucial market need by reducing U.S. dependency on electrical steel imports.” The facility will be able to produce up to 150,000 metric tons of non-grain-oriented electrical steel (NOES) each year.

“We recognize the importance of creating a resilient, sustainable domestic supply chain for this critical material,” said John Brett, CEO with ArcelorMittal North America.

Ivey, in a statement provided by the company, said ArcelorMittla’s investment “not only strengthens Alabama’s position as a key player in the steel industry but also paves the way for innovation in electric motors and renewable energy technologies.”

The governor’s office is expected to release additional information later today. It’s unclear how much in state and local tax incentives were being issued to support the project.

NOES has been identified as a critical material for producing electric motors used in battery electric vehicles, plug-in hybrid electric vehicles, hybrid vehicles and a broad range of energy technologies and applications. The production of NOES requires specialized technical expertise, advanced manufacturing capabilities and rigorous quality control to meet “stringent specifications for magnetic and mechanical performance,” according to the company.

The facility will be located near ArcelorMittal and Nippon Steel’s joint venture, AM/NS Calvert, a state-of-the-art steel plant that includes a river terminal, hot strip mill, cold rolling mill, hot dip galvanizing lines, rail yard, supporting infrastructure, and a new electric arc furnace (EAF) that is nearing completion.

Plans for the new ArcelorMittal Calvert plant include an annealing pickling line, cold-rolling mill, annealing coating line, packaging and slitter line, and additional ancillary equipment needed for specialized electrical steel manufacturing operations.

ArcelorMittal had announced in April of last year that it had received a more than $280 million incentive from the federal government for a new plant that would produce non-grain-oriented electrical steel, a type of steel used in electric vehicles.