Essar to invest Rs17,760 crore in steel plant in Karnataka

Ruias-promoted Essar Steel plans to set up a 6mtpa steel unit in Bagalkot, in Karnataka, at an investment of Rs17,760 crore. The unit will contribute to boosting Essar's annual capacity to 25 million tonnes by 2015.

"Our investment proposal (for the steel plant) has been cleared by the Karnataka government," an Essar Steel spokesperson said.
 
The plant would have an initial capacity of 3mtpa which would be double to 6mtpa in the second phase according to sources.

The plant will comprise a pellet plant, a coke oven plant and a battery in the first phase. The company has asked for an iron ore mine from the state government on lease, to ensure uninterrupted supply of the raw material.

At present, Essar's production stands at 4.6mtpa at Hazira in Gujarat, which is planned to be increased to 9mtpa. It also operates an 8mtpa beneficiation plant at Bailadilla in Chattisgarh and an 8mtpa pellet complex in Visakhapatanam in Andhra Pradesh.

The company is also putting up a 6mtpa integrated steel plant at Paradeep, in Orissa.

Besides India, Essar Steel also has a presence in Canada, the US and Indonesia.

Essar Steel Algoma has 4mtpa capacity while PT Essar Indonesia, the second largest private sector producer of cold-rolled steel in that country, has a rolling capacity of 400,000mtpa.

Minnesota Steel, which was acquired by Essar, has plans to put up a 2.5mtpa integrated steel plant at an estimated cost of $ 1.65 billion.

India which is already the fifth largest manufacturer of steel in the world, envisages steel production in the country to reach 110mtpa by 2019-20.