RINL seeks Bird Group's acquisition

State-run Rashtriya Ispat Nigam Ltd (RINL) has sought the acquisition of the Bird Group of Companies (BGC), including Orissa Mining Development Corporation (OMDC), to secure iron ore reserves for expansion, and has said it is willing to invest Rs 500 crore to revamp OMDC.

"We do not have captive mines and are forced to procure ore from the market at sky-high prices. So, we have proposed to take over the entire BCG, including OMDC, which has iron ore reserves of 130 million tonnes, to meet our growing production needs," said RINL Chairman and Managing Director PK Bishnoi.

He said steelmakers with the security of iron ore had a better turnover. "I have to buy iron ore from the market at around Rs 3,000 per tonne, which is a pretty high price ... RINL's profits could have been higher by Rs 1,000 crore if we had captive mines," Bishnoi said.

A parliamentary consultative committee had expressed concern about the need to ensure availability of critical raw materials like iron ore and coking coal for present- and post-expansion needs of steel PSUs. The committee supported a curb on iron ore exports. The government is yet to take a call on the Bagchi Committee's recommendations on the BCG. "The committee's report is still under consideration. We will take a decision in due course of time," said a senior steel ministry official.

Bishnoi said RINL was willing to invest about Rs 500 crore to overhaul OMDC, which is not in good shape. He added RINL would like to use its expertise in prospecting more fields to figure out additional ore reserves in OMDC.

OMDC, which was incorporated in 1918, is one of the oldest iron ore mining companies. It has mines around Barbil town in Orissa.

The BCG has seven companies in its fold "" OMDC, Bisra Stone Lime Company Ltd, Karanpura Development Company Ltd, Scott and Saxby Ltd, Eastern Investments Ltd, Burrakur Coal Company Ltd and Borrea Coal Company Ltd.

RINL's expansion plan involves a capital outlay of Rs 8,692 crore for raising the steel production capacity to 6.3 million tonnes from the current 3.4 million tonnes.

At one point of time, the company was even mulling importing a shipload of iron ore from Brazil on an experimental basis.