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The Steel Minister, Mr Beni Prasad Verma, has expressed displeasure over the pace of modernisation at the public sector Steel Authority of India Ltd.
The modernisation project at SAIL was taken up in 2007-08 and it is likely to be completed by 2012-13.
“The pace of modernisation at SAIL is a cause for concern. I am not happy with it and they need to step up production immediately,” Mr Verma, who was elevated to the Cabinet rank in Tuesday's ministerial reshuffle, told reporters.
Capacity expansion
When completed, the Rs 72,000-crore modernisation would result in capacity expansion of crude steel output from 14 million tonnes per annum (mtpa) to 24 mtpa, said Mr C.S. Verma, Chairman, SAIL.
“We expect to commission two blast furnaces in Rourkela by January 2012 and trial runs in the Burnpur plant would commence by the year-end,” Mr Verma said.
The modernisation of 100-year-old IISCO-Burnpur plant with a capacity of 3 mtpa has seen an estimated cost overrun of Rs 2,000 crore. The revised cost of Burnpur plant modernisation is now Rs 16,408 crore against the initial cost of Rs 14,443 crore. The Burnpur plant was supposed to commence operation by June and is now delayed by about six months.
Mr Verma attributed the delay to the unexpected molten debris at the plant site, which expanded the scope of work of the modernisation project. Reacting to the Minister's displeasure, Mr Verma said “the expectations are high and we are trying to meet them”.
The SAIL chairman also said that the company was opening an office in Indonesia and would be soon appointing a consultant for coal exploration in Central Kalimantan.
Posco project
The Steel Secretary, Mr P.K. Mishra, said the holding structure of the proposed joint venture of SAIL with South Korean steel maker POSCO would be finalised only after the detailed project report is complete.
SAIL had signed an MoU with POSCO last year for a joint venture to set up a specialised steel plant at Bokaro. The joint venture plant is expected to use the Korean firm's FINEX technology to produce steel using iron ore fines and non-coking coal.
“We will decide the joint venture equity structure, once the negotiations are complete,” Mr Mishra said.
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