Steel Authority of India (SAIL) today said it was hopeful of creating a special purpose vehicle (SPV) for revival of the Sindri unit in two-three months at a cost of Rs 35,000 crore.
"The SPV will be created in the next 2-3 months. We plan to spend around Rs 35,000 crore for revival," SAIL Chairman CS Verma said.
Verma said plans were there for setting up a 5.6 million tonne per annum steel plant, a 1.15 million tonne urea facility and 1,000 MW power plant at Sindri in Jharkhand along with the suitable Joint Venture partners.
The Cabinet Committee on Economic Affairs had last month selected SAIL as lead shareholder, on nomination basis, for revival of the Sindri unit of erstwhile Fertiliser Corporation of India (FCIL).
Verma said state-run National Fertilisers could be roped in for the urea facility, but the process of identifying others for steel and power projects was yet to be completed.
Stating that Sindri project would "bolster SAIL's efforts towards attaining Lakshya 2020," he said the project would likely to be financed through a debt-equity ratio of 70:30.
SAIL, which has embarked on a massive expansion plan to increase its hot metal production capacity to 23.5 million tonne by FY13 from just over 14 million tonne now, has constituted a committee already to chalk out a roadmap for attaining 45-60 million tonne per annum capacity under its 'Lakshya 2020' plan.
Verma said the pre-feasibility report for setting up a 0.5 million tonne per annum facility using Kobe Steel's patented ITmK3 technology for producing premium-grade iron in the form of nuggets has been prepared and the terms and conditions of the proposed joint venture are being worked out.
"There is a comprehensive strategic alliance with Posco for setting up a Finex technology-based plant, for which a detailed project report has been prepared and discussions are on to finalise the terms and conditions of the joint venture," he said.
On steel prices, Verma said since the traditionally lean phase of demand in Monsoon was over now, the demand for steel would further improve leading to firming up of the price in the short-term.
"There is no chance of steel prices coming down. I don't foresee any dip in price. This is the time of the year when demand goes up," he said, adding that the demand for steel in the country would be "good" in times to come.
