State-run companies SAIL and NMDC have joined hands to set up a 6 million tonne greenfield steel plant at Dilmili in Bastar district of Chhattisgarh at an estimated expenditure of Rs 25,000 crore.

Steel maker SAIL and iron ore miner NMDC Limited will sign a MoU this month to jointly pool in money needed for the project. Steel minister Narendra Singh Tomar had spoken to Chhattisgarh chief minister Raman Singh late last month for facilitating acquisition of land and ensuring water and power linkages for the mega project.

The Dilmili area is close to Nagarnar also in the same district where NMDC is constructing a 3 MT steel plant.

SAIL’s board had in December approved setting up of a SPV — Chhattisgarh Mega Steel Limited and the state-run steel maker and NMDC will ink an MoU for executing the project. While these two firms would have the majority stake in the SPV, the residual stake will be given to a strategic partner who will be roped in through an Expression of Interest. A separate SPV would be formed by these two state-run companies with Chhattisgarh State mining corporation (CMDC) for exploitation of iron ore in Dantewada district of the state, a top steel ministry official told The Indian Express.

“The proposed project is in sync with the government’s ‘Make In India’ programme. A target of producing 300 million tonne of steel within 10 years has been set by the government. Given the fact that the steel market is gradually looking upwards and prices inching up, the ministry has vetted setting up of this mega project,” he said. Any project above 5 MT capacity should be treated as a mega plant, the official added.

When contacted , SAIL chairman CS Verma confirmed that a MoU is to be signed, but did not divulge further details. The construction for the project is likely to begin by November after land is acquired and necessary clearances are secured by the SPVs.

 

Source:http://indianexpress.com/

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