JSW Steel to begin Work on Odisha Plant in FY20

Leading domestic steel maker JSW Steel is hopeful of commencing work on its 12 million tonne per annum (MTPA) steel project in Odisha in 2019-20.

According to a top company official, work on the mega steel mill will begin in right earnest after the project gets all clearances- environment and forestry approvals included. The plant estimated to cost Rs 55000 crore along with associated infrastructure like captive power plant, pelletisation complex, and a slurry pipeline, will be developed in a phased manner. In the first phase, a blast furnace with the capacity to churn out five million tonnes of hot metal will be installed in the plant premises.

The Odisha government recently announced that 2,900 acres of land has been allotted to JSW Steel. The JSW project will be erected at the site once identified and zeroed in for a 12 million tonne plant pledged by Posco. The plant by the South Korean steel monlolith was India's biggest FDI (foreign direct investment) valued at $12 billion then. But uncertainties in getting a mine block after introduction of a transparent system of mineral auctions led Posco to abandon the project and surrender land to Odisha Industrial Infrastructure Corporation Ltd (Idco), the state agency for land and industrial infrastructure facilitation.

Idco had acquired 2,700 acres of land in coastal Odisha in the vicinity of the Paradip port. Out of the acquired land, 1,700 acres were transferred in favour of Posco. After Posco's interest on the steel unit evaporated, JSW Steel lobbied for the land. In its original application, JSW Steel had sought 4,500 acres for its steel plant. The state government, after a due appraisal by consultant Mecon Ltd, okayed 2900 acres.

To secure iron ore supplies for its integrated steel project, the company has pitched for a long-term agreement for 50 years with state-owned Odisha Mining Corporation (OMC) to supply 30 MTPA of iron ore fines at IBM (Indian Bureau of Mines) declared price.

The greenfield steel plant planned in Odisha is central to JSW Steel's organic expansion. The steelmaker aims to ramp up its total crude steel capacity to 24.7 MTPA from 18 MTPA at present. At the company's 24th annual general meeting (AGM) in July, JSW Steel's chairman cum managing director Sajjan Jindal said the company has firmed up Rs 450 billion investment between 2017-18 and 2020-21 to expand steel capacities as well as modernize and expand its downstream businesses. Alongside organic growth, JSW Steel's thrust is on inorganic growth too as the company continues to explore value creating strategic opportunities - both in domestic and international markets.

Through its acquisition of Monnet Ispat & Industries Ltd located close to the mineral-laden belts in Chhattisgarh.