Public sector mini ratna company Manganese Ore India (MOIL) has taken up Rs 900-crore capital expenditure plan over the next 3-4 years, a top company official said today.
"We plan to expand value-added production capacity and to enter into joint ventures with Steel Authority of India (SAIL) and Rashtriya Ispat Nigam (RINL) to set up ferro alloy plants in Chhattisgarh and Andhra Pradesh," MOIL's Chairman and Managing Director, K J Singh told reporters here.
MOIL will invest Rs 100 crore in SAIL JV and Rs 50 crore in RINL JV, apart from Rs 768 crore in mining expansion over the next 3-4 years period, he said.
Both 50:50 JVs with SAIL at Chhattisgarh and RINL at Andhra Pradesh to set up ferro alloy plants will cost Rs 392 crore and Rs 206-crore, respectively.
Both the plants will produce ferro manganese and silico manganese in order to secure further potential sources of demand for our high grade manganese ore, he said.
"We are committed to maintaining our leadership position in the Indian manganese ore market by increasing our production capacity in line with demand growth, focusing on our value-added product line to capture industry trends, controlling costs and strengthening relationships with our customers," Singh said.
The Indian steel industry is expected to continue to advance on a strong growth trajectory and the total installed domestic capacity is anticipated to be 121 million tonnes by 2011-2012. This is expected to result in continued demand for manganese ore, Singh said.
"To meet rising demand, we plan to expand our manganese ore production capacity at our existing mines. We are looking at deepening of the production shaft at the Balaghat mine and Gumgaon mine and sinking of the vertical shaft at the Munsar mine. This will help in expansion as well as to sustain our production capacity for manganese ore," he said.
"We estimate that these projects would increase our total production capacity to 1.5 million tonnes by 2015. We have committed Rs 49.81 crore in capital expenditure in connection with these expansion projects," he said.
MOIL also intends to add to its current reserves and resources by undertaking exploration in and around its existing lease areas.
"The company has applied for a prospecting license for mining in approximately 814.71 hectares in Maharashtra. In addition, it is engaged in ongoing exploration efforts in portions of our approximately 1,798.9 hectares of land already held under long-term mining leases in relation to its existing mining complexes," Singh said.
The company hopes to receive permission from Securities and Exchange Board of India (Sebi) for its proposed IPO shortly. The Central government is divesting 10 per cent, while Maharashtra and Madhya Pradesh state governments will be divesting 5 per cent each, he added.
