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Visakhapatnam Steel Plant (VSP), belonging to Rashtriya Ispat Nigam Limited (RINL), has embarked upon a massive expansion plan involving an investment of Rs 42,400 crore.
To facilitate execution of VSP's expansion programme, the state government had also agreed to allot iron ore mines. Both RINL and the state government had signed a memorandum of understanding (MoU) to this effect.
RINL disclosed this in a release on Thursday in the light of the objections being raised by pro-Telangana activists over the recent allotment of iron mines in Bayyaram of Khammam district to VSP.
The state-owned steel maker had reiterated its intent to set up commensurate value addition facilities such as a beneficiation plant, pelletisation plant and a steel mill, depending on the quantum of iron ore reserves available at Bayyaram and other mines proposed to be allotted in Warangal and Karimnagar districts.
Ironically, despite being one of the major integrated steel plants in the country, VSP is operating without any captive iron ore and coal mines. For securing assured iron ore linkage, RINL had applied for seven mining leases in the state starting from 2005.
RINL stated it had drawn up an ambitious corporate plan to expand VSP's capacity to 20 million tonnes per annum (mtpa) in phases by 2025. Following this, VSP would emerge as the largest steel plant in a single location in the country.
In line with this plan, RINL said it was on the verge of completion of the initial phase of expansion involving doubling of VSP's existing capacity to 6.3 mtpa. The capacity was being further expanded to 7.3 mtpa in the current year through modernisation and upgradation.
RINL chairman and managing director, AP Choudhary, said VSP was moving at a brisk pace to honour its commitment made in the MoU and had already got approval for investments of over Rs 17,000 crore. The additional investment of around Rs 25,000 crore, which pertained to the next phase of expansion to 12 mtpa, was subject to assured iron ore linkage by the state government.
