Bengaluru, July 7 (IANS): The National Mineral Development Ltd (NMDC) will set up a three-million tonne per annum steel plant in Karnataka, union Steel and Mines Minister Narendra Singh Tomar said on Tuesday.
The greenfield plant, in the state's mineral-rich northern region, will be a joint venture with the state government at a cost of Rs.18,000 crore, he told reporters here.
Though the Hyderabad-based NMDC's main activity is mining iron ore and selling the raw material to steel plants, it is foraying into rolling out the hot metal to meet the 300 million tonne production target the government seeks to achieve over the next decade.
"The government is setting up four steel plants in Chhattisgarh, Jharkhand, Karnataka and Odisha through state-run SAIL, RINL and NMDC by forming special purpose vehicle (SPV) for each of them with the respective states where the raw material is available in abundance," Tomar said after chairing a parliamentary consultative committee meeting of his ministry.
The installed capacity will be doubled to six million tonne per annum in each plant in the second phase to meet the demand from across the country by diverse industry verticals for domestic consumption and exports.
The proposed four steel mills will contribute an additional 20-24 million tonnes to the annual national capacity, which is currently at 101 million tonnes, though actual production is 80-85 million tonnes.
Later, Tomar flew to Belagavi to discuss the ambitious project with Chief Minister Siddaramaiah and officials, as land and resources, including captive mines, have to be identified and allotted.
"I have also urged the chief minister to allot captive iron ore mines to KIOCL (Kudremukh Iron Ore Company Ltd) to fully utilise its pellet production plant at Mangaluru, as its mines in the Western Ghats were shut down by the Supreme Court (a decade ago) on environmental grounds," Tomar told reporters at Belagavi.
NMDC will be the second state-run enterprise to have a steel plant in Karnataka after SAIL, which operates a steel mill at Bhadravati in Shivamogga district.