)
South Korean steel giant Posco and homegrown steel maker Mesco Steel would enter into a definitive agreement next month for transfer of the former's patented Finex technology and installation of a plant based on this technology at Mesco premises at Kalinganagar in Jajpur district.
"We will have a firm agreement with Posco next month for the Finex plant (of 0.6 million tonne capacity). After that, the process of dismantling of Posco's Finex plant in Korea and its subsequent installation at our premises would take off,"said J K Singh, chairman emeritus of Mesco Steel.
To facilitate the transfer of Finex technology, both Mesco and Posco had signed a memorandum of agreement in March this year. In an earlier statement, Mesco Steel had said Posco would have 26 per cent equity in the joint venture (JV) project.
"We are importing Finex technology from Posco. Dastur & Company has already submitted its report in this connection. It will take one year to make the Finex plant operational at our premises", said a senior Mesco Steel official.
Since the Finex plant requires a lot of oxygen and power, Mesco Steel has already initiated talks with some companies for setting up auxiliary plants on the JV route. The Finex plant during operation would need a running 100 Mw captive power plant (CPP) and an oxygen plant of 1000 tonne per day (tpd) capacity.
"For the CPP, we are talking to two companies including Tata Power while for the oxygen plant, we are in talks with an Italian company. We hope to sign JV agreements with the selected players in two to three months", said the official.
Finex process is expected to cut hot metal production cost for Mesco by Rs 2000-2500 per tonne.
Finex technology, developed exclusively by Posco, is the process to smelt iron ore without using expensive coking coal. As the process uses normal coal abundantly found in Odisha, it will reduce the cost of production for hot metal.
Mesco Steel currently has two blast furnaces at its Kalinganagar facility whose revamp has been completed at a cost of Rs 70 crore in the last 18 months.
It has an operational mine at Roida (Barbil), 190 km from the plant site, with an annual production capacity of three million tonne per annum (mtpa). Mesco's Kalinganagar plant has a pig iron making facility of 1.2 mtpa. It hopes to achieve steel making capacity of 3.5 mtpa within a span of four years.
