Steel min seeks gas on a par with fertiliser sector
The steel industry has joined the list of sectors that are unhappy with the government’s gas utilisation policy.
By TNN |
NEW DELHI: The steel industry has joined the list of sectors that are unhappy with the government���s gas utilisation policy. Aggrieved at being ignored from the list of priority sectors for gas allocation, the steel secretary has shot off a letter to the petroleum secretary seeking not only more supplies but also bringing steel on a par with the fertiliser sector.
The demand has been made in wake of acute shortage of natural gas for three plants ��� Essar Steel, Ispat Industries and Vikram Ispat ��� which use gas as fuel for making steel. While the requirement of these plants is 12.90 million metric standard cubic meter per day (mmscmd), the allocation is 5.76 mmscmd and availability 1.85 mmscmd or 32.12% of total allocation.
���There is supply-demand mismatch in respect of steel, which has caused shortage and the current price rise is one consequence of this shortage. We have to ensure steel industry utilises its capacity to the fullest extent so that the demand could be made to the extent possible. So, we have to ensure that supply of gas (to the sector) is adequate,��� steel secretary R S Pandey has written in his letter.
The steel ministry wants the concerns to be reflected in gas utilisation policy being finalised by the government.
In the interim, an empowered group of ministers has finalised allocation for 2008-09 where steel has been clubbed with other sectors that are last in the priority list.
India produces 8.5 million tonnes of steel through natural gas-based sponge iron technology. With lower gas availability the plants are running at 80-85% of installed capacities, causing a loss of 1 mt of production.
The demand has been made in wake of acute shortage of natural gas for three plants ��� Essar Steel, Ispat Industries and Vikram Ispat ��� which use gas as fuel for making steel. While the requirement of these plants is 12.90 million metric standard cubic meter per day (mmscmd), the allocation is 5.76 mmscmd and availability 1.85 mmscmd or 32.12% of total allocation.
���There is supply-demand mismatch in respect of steel, which has caused shortage and the current price rise is one consequence of this shortage. We have to ensure steel industry utilises its capacity to the fullest extent so that the demand could be made to the extent possible. So, we have to ensure that supply of gas (to the sector) is adequate,��� steel secretary R S Pandey has written in his letter.
The steel ministry wants the concerns to be reflected in gas utilisation policy being finalised by the government.
In the interim, an empowered group of ministers has finalised allocation for 2008-09 where steel has been clubbed with other sectors that are last in the priority list.
India produces 8.5 million tonnes of steel through natural gas-based sponge iron technology. With lower gas availability the plants are running at 80-85% of installed capacities, causing a loss of 1 mt of production.
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