Essar Steel Ltd has started work on its 6 mt steel project at Paradip in Jagatsingpur district. The company is investing Rs 20,000 crore in the project. In the first phase, it is putting up an 8 mt iron ore pellet plant with a 253-km long pipeline from Joda to Paradip at a cost of Rs 2,700 crore. Plant, pipeline and steel-making facilities will be ready by 2010 and 2012.
To start with, the plant will have facilities to produce steel slab. It will go for hot rolled and cold rolled products later.
?Civil construction work has started on 104 acre now at our disposal,? Essar Steel Orissa director HS Sethi told FE. ?Instead of waiting for completion of the total land acquisition (2,000 acre), we have commenced work on whatever land is available to us,? he said. The progress of pipeline laying work and acquiring the rest of the land was also satisfactory, Sethi added.
?We have already committed Rs 6,000 crore for the project. Of this, Rs 4,000 crore will be used for booking equipment,? said Sethi. ?Our project is well on schedule and it will come up within the targeted time frame.?
Interestingly, while Posco-India?s 12 mt steel project at Paradip is facing land acquisition and iron ore mines linkage problems, Tata Steel?s 6 mt project has not taken off owing to resistance from local people. The 12 mt project of ArcelorMittal and the projects of Jindal Steel & Power and Sterlite Iron & Steel are yet to take off as well owing to various reasons.
Essar has applied for iron ore mines linkage for the plant. The company has an eye on Thakurani mines, which is rich in high-grade ores.
?We are quite hopeful of getting the iron ore mines linkage,? said the director. The state government has assured us of the required raw material supply for the pellet plant, he added.
Essar, which at present has a steel making capacity of 4.6 mt, has also signed MoUs with the Jharkhand and Chhattisgarh governments to set up projects of 6 mt and 4 mt.