SAIL hopes to freeze JV with Posco by November

"The MoU with Posco for setting up a steel plant at Bokaro in Jharkhand using Finex technology was signed in May this year. A detailed project report (DPR) is being prepared. The DPR will be ready by November and by then we will be able to freeze the JV with the Korean steel-maker," Chairman of Steel Authority of India Ltd (SAIL) C S Verma said on Saturday.

Finex technology is an innovative method of producing molten iron directly using iron ore fines and non-coking coal. It is developed by Siemens VAI and Posco.

After signing the JV, the gestation period would be three years, Verma told reporters here on the sidelines of a seminar on raw material security for the steel industry.

Steel minister Virbhadra Singh who was present said, "The entire project is on fast track."

Initially the size of the plant would be 1.5 million tonne, which would be ramped up to 3 million tonne. This would require an investment of Rs 12,000-15,000 crore, he said.
On the equity structure of the JV project, the Steel minister said that Posco, which would provide the Finex technology might insist on having majority stake in the proposed project.

"Our effort will be to make it a 50:50 JV. But at the same time, we cannot be rigid since we need the technology. This will be the first plant outside South Korea, which will use Posco's Finex technology," the Steel minister said.

The SAIL chairman said that the company was also thinking of joining hands with Kobe Steel of Japan to set up a joint venture (JV) project using the Japanese company's pioneering steel-making technology.

To a question, he said SAIL's alloy steel plant in Durgapur has been identified as the possible location for setting up the project.

On the size of the project, Verma said that it was available in 0.5 million tonne module. "We have to decide how many modules we will opt for. It will be decided in two months time."

On the investments required, he said one module cost Rs 5,000 crore. The new unit will use Kobe Steel's technology of making iron nuggets.

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