The country's largest iron ore producer, NMDC, will appoint a consultant by the month-end to look for a site in Karnataka to set up its estimated Rs 20,000-crore steel plant in the state.
"NMDC is in talks with few consultants, and would finalise one by the month-end. The consultant would scout and finalise a site in Karnataka for setting up the steel project," a person in the know of the development told PTI.
The development comes within days of the Karnataka government clearing over Rs 30,000-crore proposed projects of steel giants Posco and ArcelorMittal, which may hot up the race for securing rich iron ore mines in the state.
NMDC is actively pursuing its aspirations to diversify into steel making. The proposed venture in Karnataka would be its second such project. The company is setting up a Rs 13,000-crore steel plant in Chhattisgarh.
As per the Memorandum of Understanding signed with the Karnataka government last year, NMDC plans to set up a steel plant with a total annual capacity of 5 million tonnes.
The firm intends to set up the project through a joint venture and would start looking for a partner, Indian or global, for the purpose after securing land and captive mines in the state, the source said.
"NMDC will initially set up a 2 MTPA plant in the state in a joint venture and ultimately scale up the capacity to 5 MTPA," the source added.
Industry experts said that setting up a 1 MTPA plant on an average costs Rs 4,000 crore, so a 5-MTPA project would cost about Rs 20,000 crore.
