Ispat Investing $2.5 Billion in Steel Mills, Blast Furnace and Coke Production

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Researched by Industrial Info Resources (Sugar Land, Texas)--India’s state-owned steel-production complex Rashtriya Ispat Nigam Ltd (RINL) at Visakhapattanam (VSP) in Andhra Pradesh state, is implementing a $2.1 billion plan to increase the capacity of the plant from the current annual production level of 3.6 million tons of liquid steel to 6.3 million tons by March 2010.

The company also plans to increase the liquid steel capacity of existing production facilities by 500,000 tons pr annum (tpa) by the same date. This increase will be achieved through the introduction of several additions, modifications and replacements plus some new technology for $122 million. Work is underway on a $200 million structural steel mill to be followed by a $200 million continuous caster addition and the $190 million No3 blast furnace. The iron ore feed required to produce the 6.3 million tons of steel has been arranged by the National Mineral Development Corporation.

RINL has also applied for iron-ore-reserve mining leases in the states of Orissa, Chhatisgarh and Andhra Pradesh. Allocations of leases have not yet been made.

Arcelor-Mittal (NYSE:MT ) (Rotterdam, Netherlands) owned Ispat Industries (New Delhi) is planning to expand overseas using production capacity expansion and backward integration. The company will invest about $2.5 billion over five years in ramping up domestic production. Production at the Dolvi plant near Bombay will be ramped up to 3.6 million tpa from 3 million tpa with an investment of $730 million by 2011-12. Expansion plans include building a 1 million tpa coke oven plant and a 4.5 million tpa coke pellet plant with the likely site being VSP. A new plant proposed at Jharkhand could take an investment total of about $1.4 billion and plans for a $9 billion greenfield steel plant at Keonijhargarh in Orissa are under review.

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