Reports suggest that Uttam Galva Steels is holding talks with South Korean steel major Posco to set up a 3 million tonne per annum (mn tpa) steel plant in Maharashtra at a cost of Rs 16,000 crore.
Reports also indicate that both the companies plan to form a joint venture for the project and the world’s leading steel maker ArcelorMittal may participate in the project.
ArcelorMittal holds 33.80 percent stake in the Mumbai-based Uttam Galva Steel. The companies plan to set up the proposed plant on a 1,700 acre land at Satarda in the Konkana region.
The land would be provided by Uttam Galva Steels which owns the land parcel. Satarda is closer to Goa, a state with huge reserves of iron ore. However, the iron ore produced from the state is low-iron bearing. Posco’s patented Finex technology of iron producing uses fines (low-grade iron).
The South Korean steel major had intended to use Finex technology in a proposed joint venture with state-owned Steel Authority of India (SAIL), but the project hasn’t taken shape so far due to differences over shareholding structure.
The companies would also work out the shareholding and other details of the proposed project. It generally takes $1 billion or Rs 5,500 crore to set up a steel plant of 1 million tonne capacity.
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