Steel ministry in favour of RINL to operate NMDC’s steel unit

Exclusive

26 September 2016

Even as the National Democratic Alliance government has strategic sale plans for state-run National Mineral Development Corp. Ltd’s (NMDC) Nagarnar steel plant in Chhattisgarh, the ministry of steel is of the view Rashtriya Ispat Nigam Ltd (RINL) should operate the plant.

The Cabinet Committee on Economic Affairs (CCEA) in October cleared the strategic sale of four steel units including three units of the Steel Authority of India Ltd and Nagarnar steel plant of NMDC. NMDC’s plant is likely to be commissioned by December 2016.

“In a recent meeting of senior steel ministry officials, it transpired that RINL shall operate NMDC’s steel plant in Chhattisgarh as the plant is on the verge of being commissioned. NMDC has a core competency in iron ore mining and no expertise in steel making,” said a senior government official on condition of anonymity.

Another government official, who also did not want to be named, confirmed the move and said discussions are on to implement the new plan but nothing has been formalised.

NMDC, as part of its diversification and forward integration plan, is setting up a three million tonne integrated steel plant at Nagarnar for which the construction work is in full swing. According to information available on the company’s website, work of more than Rs.15,000 crore has been awarded and an expenditure of about Rs.10,000 crore has already been made so far.

NMDC had been granted environment clearance for its seven-million-tonne (MT) per annum iron ore mine at Bailadila in Chhattisgarh, which will feed the steel plant in Chhattisgarh.

A senior RINL executive, requesting anonymity, said the discussions have been held related to the issue of handing over Nagarnar unit to RINL but nothing has been communicated to the company so far by the government.

“The company is also undertaking expansion of its liquid steel capacity from 3 to 7.3 MT at its Visakhapatnam steel plant,” the executive added.

Source – VC Circle