L&T, Vedanta to join hands for Orissa steel project

London-listed Vedanta Resources Plc and Larsen and Toubro have proposed to jointly set up a mega steel plant in Orissa. The two companies are in an advanced stage of negotiations with the state government, and formal announcement in this regard will be made soon, chairman of Vedanta Resources Plc Anil Agarwal said in Bhubaneshwar on Thursday.

Agarwal met Orissa chief minister Naveen Patnaik on Thursday to discuss the group's projects in the state. He later told reporters, ''We are in advance stage of negations with the state government and very soon we are going to sign a tripartite agreement."

He, however, refused to disclose details about the size, location and cost of the project.

Sterlite Industries, a unit of Vedanta, had signed a preliminary agreement with the Orissa government in 2004 to build a five-million-tonne steel plant in the state's mineral-rich Keonjhar district.

"We have already initiated discussions with the Orissa government to find out if we can go with the old memorandum of understanding or sign a fresh one," A K Samal, senior vice president of Vedanta's projects in Orissa, said.

During his discussion with the chief minister the Agarwal promised to spend a minimum of Rs10 crore or five per cent of the profit of the company's Lanjigarh project for the welfare of the locals in the tribal-dominated Kalahandi district.

Agarwal also assured the state government that it would provide electricity from its independent power project at Jharsuguda smelter unit, providing some relief to the power starved state.

''The first unit of the 2,400-mw independent power plant at Jharsuguda would be commissioned in the coming summer. This will add 600 mw to the state's power production capacity and can help the state government in combating the current power crisis,'' he said, adding that Vedanta has been supplying 15 per cent of the total power requirement of the state from its captive power plant.