NMDC offers land, iron ore to Nippon for Rs 9.5K cr JV project

"NMDC, in a recent communication with Nippon Steel, has said it will provide about 2,500 acres of land, which the Karnataka government has promised to give it in the Bellary- Hospet region of the state, for the proposed steel plant. "In addition, NMDC said it can provide iron ore as well. In lieu of the land and iron ore, it has asked Nippon Steel to bring its technology to India and fund the JV project," a senior government official said.

Neither, NMDC nor Nippon Steel could be contacted for their comments. However, last month NMDC Chairman had confirmed that the country's largest iron ore producer is in talks with the world's fourth-largest steel firm for setting up a steel plant with an initial annual production capacity of 2 million tonnes in Karnataka.

The official, however, said the talks between the companies have not reached any advanced stage. Earlier, NMDC was also reported to be in talks with Tata Steel for the JV project in Karnataka. State-owned RINL had also offered to partner the company for the venture, the official said. NMDC had earlier signed a deal with the Karnataka government to set up a steel plant in the state.

Besides Nippon, NMDC is also talking to another Japanese firm Kobe Steel for a joint venture project to produce iron nuggets in Andhra Pradesh at the premises of Sponge Iron India (SIIL), which has been amalgamated with it last month. SIIL has an annual capacity to produce of 60,000 tonne of sponge iron. The mining firm is already in process of starting construction work for its over 15,000 crore integrated project in Chhattisgarh by November-December this year, Som had earlier said. The Chhattisgarh plant to come up in backward district of Bastar, will have an annual production capacity of 3 million tonnes.

NMDC will be the second steel PSU, after SAIL, to be in talks with Japanese companies. SAIL is in talks with Posco to set up over Rs 11,000-crore integrated steel plant in Jharkhand. SAIL is also considering setting up downstream mills to produce specialised steel products with Posco in Maharashtra.