City-based Steel Exchange India Limited (SEIL), a steel-making and trading company, is planning to set up a 60-Mw power plant at its existing integrated steel mill premises in Vizianagaram district.
The power project is estimated to cost Rs 315 crore, of which about Rs 80 crore would be funded by promoters while the rest would be raised from financial institutions, B Suresh Kumar, joint managing director of SEIL, told Business Standard.
During the last financial year, SEIL had taken over a sick steel sponge iron mill from Gold Star Alloy India Limited in Vizianagaram district and is now in the process converting it into an integrated steel mill, spread over 400 acre, at an investment of Rs 400 crore. The steel melt shop in this unit will be ready within two months, taking its production capacity to 250,000 tonne a year.
“Once the steel melt shop goes on stream, we will start work on the power project. We are aiming to commence power production from this plant by March 2012,” Kumar said.
Kumar said the company would utilise the waste gases, generated from steel melting, for power production. “We are expecting about 16 Mw of power to be generated from these waste gases and 44 Mw from thermal coal,” he added.
SEIL, which reported a turnover of Rs 696 crore in 2009-10, is already operating an 8-Mw gas-based power plant in Ravulapalem in East Godavari district.
The group has a 90,000-tonne capacity steel mill and two wire-drawing units in Visakhapatnam district.