Ispat plans Rs10,000 crore investment to expand capacity
10 Dec 2007
Mumbai: Integrated steel manufacturer and the largest private sector producer of hot rolled coils in India, Ispat Industries Ltd (IIL), plans to invest in excess of Rs10,000 crore to expand capacity.
"As part of the first-phase expansion, the company would raise steel-making capacity of its Dolvi plant in Maharashtra to 5 million tonnes from 3 million tonnes in 18-months period," Ispat Industries VP and chief enabling technology and automation, Atul Kumar, said on the sidelines of a manufacturing summit.
"The investment would be anything between Rs10,000 crore to Rs25,000 crore depending upon what technology we will select," Kumar said.
The dual technology use allows Ispat total flexibility in choosing either the conventional blast furnace route or the electric furnace route for steel making.
Ispat can choose pig iron, sponge iron, iron-ore, scrap or any combination of these raw materials,as its feed.
It also has total flexibility in choosing its energy source, be it electricity, coal or gas.
Meanwhile, Ispat Industries has entered into a joint venture with UK-based Stemcor to set up a coke oven plant at its unit near Mumbai at an investment of Rs900 crore.
Stemcor will hold 76 per cent stake and Ispat will hold 24 per cent in the joint venture Amba River Coke Company. The project will cater 100 per cent captive metcoke requirement of Ispat on a cost plus basis, reports said.
The joint venture will have an equity of around Rs300 crore and a debt funding of Rs600 crore, sources said. It will also have a back-to-back agreement for long- term sourcing of coking coal from Australia.
The coke oven battery will also generate captive power for Ispat''s Dolvi integrated steel plant from the coke oven gas. The plant would generate about 150 MW of power. It is also commissioning a 110 MW blast furnace gas-based power plant, which will also be completed by the end of next year.
Ispat is one of the largest importer of metcoke from China. Chinese metcoke prices are highly volatile and in the current year prices have increased from $200 dollars per tonne to $450 dollars per tonne.
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