Rashtriya Ispat eyes ore in Canada

KOLKATA: Rashtriya Ispat Nigam (RINL), which runs the Vizag Steel Plant, has put in a bid to develop iron ore assets in Canada, even as its applications for leasing iron ore mines in Jharkhand and Orissa have been rejected by the states. The company has no captive mines of its own, which has dented its profitability by almost Rs 1,500 crore.

“We have submitted our expression of interest (EoI) for an iron ore deposit in Canada,” RINL chairman and managing director PK Bishnoi said on Thursday. The reserve is estimated to hold 2.4 billion tonne of iron ore. “It is too early to comment on whether we will develop it on our own or join hands with another partner for mining and development,” Mr Bishnoi added.

On the rationale for bidding for overseas ore, he said: “Our captive port, Gangavaram, would be ready by May. If we manage to get the reserve, it would be cheaper for us to transport the ore from Canada to Visakhapatnam than to get it from Jharkhand... Iron ore is crucial for the plant which is undergoing first phase of capacity expansion from 3.5 million tonne (mt) to 6.3 mt by 2009,” he said. An investment of Rs 12,000 crore has been planned for the first phase. Orders for equipment worth Rs 8,000 crore have already been placed for the first phase of the expansion programme.

Another Rs 900 crore would be invested for capital repair of the plant’s two blast furnaces. This is slated to add another 1 mt, taking the plant’s total capacity to 7.3 mt by 2010. RINL has also decided to set up a ferro manganese unit at a cost of Rs 100 crore, which would meet nearly 50% of the plant’s requirement.