Tata Steel to invest Rs 15000 cr in Orissa

Tata Steel plans to invest Rs 15,000 crore in Orissa over the next couple of years.

The core of this plan is the creation of 5-6 million tonne steel capacity in the state at an investment of Rs 12,000 crore.

Other proposed ventures include development of the Dhamra port, setting up of a new ferro chrome complex and a new sponge iron plant, modernisation and expansion of captive mines, establishment of the Gopalpur special economic zone and capacity expansion of Tata Steel group companies like Tata Sponge and Tata Refractories.

This is revealed in a recent letter by Tata Steel managing director B Muthuraman to Orissa chief minister Naveen Patnaik. Tata Steel chairman Ratan Tata had also visited the state earlier this year.

The letter pointed out that Tata Steel envisions a steel capacity of 15 million tonne by 2010. After expansion of the Jamshedpur plant capacity from 4.5 million tonne to 7.5 million tonne through an ongoing upgradation programme, the company intends to meet the balance 7.5 million tonne of the targeted capacity through acquisitions in India and abroad.

In this regard, Orissa finds a place of significance, Muthuraman assured the chief minister. He added that the company is keen to create a 5-6 million tonne steel capacity in the state.

To achieve the objective in a shorter time frame, Tata Steel has shown interest to take over a running plant like public sector Nilachal Ispat Nigam Ltd (NINL) and Konark Met Coke, promoted jointly by MMTC and the Orissa government.

"We are in discussion with MMTC and the financial institutions with regard to NINL and Konark Met Coke. We seek the support of the Orissa government in our efforts to involve ourselves in these units and make them the base on which Tata Steel's further steel capacity can be created in Orissa," the letter stated.

Tata Steel plans to convert Nilachal Ispat into a 1.5 million tonne steel plant within two years of acquisition and ramp it up to 5-6 million tonne in the succeeding 3-5 years. This is estimate to entail an investment of about Rs 12,000 crore.

Similarly, the company has finalised a joint venture with L&T to develop Dhamra into a deep draft port at an investment of Rs 1400 crore. This port, to come up wtihin three years, will cater to the needs of Tata Steel as well as other industries in the hinterland.

Tata Steel has also finalised a proposal to set up a new ferro chrome plant either within the existing ferro chrome complex at Bamnipal or at Duburi with a production capacity of 50,000 tonne per annum along with captive power plant of 70 MW at an investment of Rs 300 crore. The project will be completed in three years.

The company is also planning a 1000 tonne per day capacity sponge iron plant in Barbil area. The plant will have co-generation capacity of 20 MW and will costing about Rs 240 crore.

To meet the enhanced requirement of raw materials for the Jamshedpur plant, Tata Steel is making an investment of Rs 500 crore at its captive iron ore and management mines in Joda area. This will include modernisation and expansion of the existing mines and mineral processing plants.

This apart, the company is in the process of setting up a special economic zone at Gopalpur and expansion of capacities of group companies like Tata Sponge at Joda and Tata Refractories at Belpahar at a combined investment of Rs 325 crore, the letter said.