A BLAST furnace producer has secured a £1m contract to supply equipment to the Chinese steel industry.

VAI UK is to supply Maanshan, China's fifth largest steelmaker, with two gas cleaning plants.

A gas cleaning plant takes hot and dirty gas from the blast furnace, cooling and cleaning it to be re-used in the steelmaking process.

It also accurately controls the blast furnace operating pressure.

The construction of the Davy Cone plants will be carried out at VAI UK's Stockton factory, which employs 130 workers.

Teesside engineers will also travel to Maanshan, in Anhui Province, to supervise the installation, commissioning and start-up of the plants, which are due to begin operating in 2007.

David Osborne, VAI UK sales manager, said: "We are delighted to receive this contract from Maanshan, particularly bearing in mind the strong competition.

"It represents another excellent reference for our Davy Cone technology on large blast furnaces and demonstrates the confidence with which our technology is perceived in the industry."

Last year, the company won a £20m contract to refurbish and replace two blast furnaces in Taiwan for the China Steel Corporation.

China is in the middle of a construction boom and its need for quality steel has sent prices soaring.

It is investing millions in modern steel production facilities to cut the amount it needs to import.

A spokeswoman for VAI UK said: "This part of our technology is getting known in China and this contract came on the back of another order, which is what every company wants.

"The potential for our technology in China is massive."

Another North-East company, Clinotherm, based in Stanley, County Durham, supplies furnace refractory linings for China's biggest steel fabricator, the Bao Shan Iron and Steel Company.

The £750,000 contract aims to minimise the downtime of its steel production line in Shanghai. The linings will be installed in September.

Girvan Nicholl, Clinotherm managing director, said: "Steel production in China is a lot like the UK 40 years ago.

"They have been using fairly dated methods of fabrication and are turning to companies like us who have the expertise to help them modernise. The market potential is huge and the future for us looks very promising."