JSW Steel will invest ₹4,500 crore to modernise its iron ore mining operations and enhance its green power generations in joint venture with JSW Energy.
The company plans to invest ₹3,500 crore to deploy high-end machines at its iron ore mines, set up beneficiation plant of 30 million tonnes(mt), digitise entire mining operations and deploy electric vehicles for movement of ores mined to cut carbon emissions.
1.35 billion tonnes reserves
Seshagiri Rao, Joint Managing Director, JSW Steel told businessline that the company’s mines are currently operated by third party contractors and it will be taken over by the company soon. The scope for improving mining operations has already been identified and orders for modern equipment has been placed, he said.
Currently, JSW Steel owns 13 iron ore mines (nine in Karnataka and four in Odisha), with aggregate reserves of 1.35 billion tonnes. It produced 32.13 mt of iron ore from its captive mines last fiscal accounting 43 per cent of its total requirement against 28 per cent logged in the previous year.
Cost down, gains up
The investment will bring down the operational cost and enhance the profitability. The company has been driving digitisation as a theme across its operations and managed to save up to ₹170 crore last fiscal.
JSW Steel has set a target to source 6,000 MW of green power and already generates about 2,000 MW by recycling the heat produced at the steel plants. It had invested ₹450 crore to acquire 26 per cent equity in the special purpose vehicle being set up by JSW Energy to source 958 MW solar and wind power. A solar project of 225 MW was commissioned recently the remaining capacity is expected to be commissioned progressively next year.
JV with JSW Energy
Rao said the company will take a call early next year on setting up 3000-3500 MW of of green energy in joint venture with JSW Energy. The green energy project of ₹12,000 crore will by funded by ₹9,000 crore debt and ₹3,000 crore of equity. JSW Steel will invest about ₹1,000 crore by picking up 26 per cent equity in these projects, he said.