COVID-19 delays NMDC’s Chhattisgarh steel plant commissioning planned this year; Now expected in July, 2021

By: |
September 29, 2020 3:28 PM

The actual resumption of mining operations in Donimalai mines is expected to be started in the month of October, 2020 which will add production of 5-6 lakh tonnes per month, the CMD added.

Senior officials of the PSU had earlier indicated that the plant would be operational this year.Senior officials of the PSU had earlier indicated that the plant would be operational this year.

The commissioning of state-owned miner NMDC Limiteds Rs 21,000 crore three-million tonne capacity steel plant in Chhattisgarh, targeted this year, has been delayed due to COVID-19 and is now expected by July next year, a top official said on Tuesday.

Experts from foreign countries, engaged in the project work, could not undertake a visit for an inspection and clearance in view of COVID-19 travel restrictions, the city- headquartered NMDC’s Chairman cum Managing Director Sumit Deb said.

Senior officials of the PSU had earlier indicated that the plant would be operational this year. Replying to shareholders’ queries at the virtual Annual General Meeting, Deb said NMDC has so far invested Rs 16,000 crore in the plant and the total cost would be Rs 21,000 crore once completed.

Nagarnar steel Plants targeted date was this year but due to COVID-19 impact foreign experts could not visit the plant. Now the revised target is it will start by July 2021,” he said. He also said the company planned to take some debt also before commissioning the activity.

“The plant is on the verge of completion. We have some balance work which will be taken up, the official said. According to him, the steel plant is expected to generate annual revenues of Rs 14,000-Rs 15,000 crore (at the optimum production levels) with EBITDA (Earnings before tax depreciation and amortisation) margins of 15-20 per cent.

Replying to a question on the demerger of the steel plant, Deb said the Board of Directors has already given the clearance with mirror shareholding. Deb said NMDC normally invests about Rs 2,000 crore towards capital expenditure.

However, this fiscal it would slightly reduce to Rs 1,860 crore.

Earlier in his speech, he said NMDC has been in discussions with both the Karnataka government and the Centre on Donimalai Mine lease extension to resolve certain unviable terms in the lease agreement.

On September 15, the state Cabinet cleared the company’s application for starting mining operations at Donimalai.

However, the actual resumption of mining operations in Donimalai mines is expected to be started in the month of October, 2020 which will add production of 5-6 lakh tonnes per month, the CMD added.

Get live Stock Prices from BSE, NSE, US Market and latest NAV, portfolio of Mutual Funds, calculate your tax by Income Tax Calculator, know market’s Top Gainers, Top Losers & Best Equity Funds. Like us on Facebook and follow us on Twitter.

Financial Express is now on Telegram. Click here to join our channel and stay updated with the latest Biz news and updates.

Next Stories
1StanChart GBS leases 7.7 lakh sq-ft at DLF’s Chennai project for office campus
2Review: Oppo F17 Pro (Diwali Edition) – Smooth, slick and super-fast
3Wings Slay Earbuds: Get ready to get rid of the wire