KOLKATA (miningweekly.com) – India’s standalone miners have been galvanized to take a slice of the domestic steelmaking pie.
All large government-owned and managed miners with large iron-ore portfolios have been in touch with their respective controlling authorities seeking to spread their strategic investments into steel production, an official in the Ministry of Steel said.
Every iron-ore, manganese and chrome ore miner was scouting for opportunities to invest in large steel mills, based on the perception that the current downturn in global commodity prices could be prolonged, making it an opportune time for capital investments in downstream production and to hedge against margin erosion from just raw material production, he added.
NMDC Limited, the largest domestic iron-ore miner and under administrative control of the Steel Ministry, has sought government approval to participate in the planned special purpose vehicles (SPVs) for construction of mega steel plants across India’s mineral-rich provinces.
The Steel Ministry has already announced the creation of SPVs in Jharkhand, Chhattisgarh, Odisha and Karnataka to put up steel mills that each have a capacity of about 10-million tonnes a year with an investment of $7-billion to $8-billion riding on each.
NMDC was keen to participate in the SPVs along with the largest steel producer, Steel Authority of India Limited (SAIL). The miner was already implementing a three-million-tonne-a-year steel project at Nagarnar, Chhattisgarh, which was at an advanced stage of completion.
Similarly, Odisha Mining Corporation (OMC), a mining entity owned and managed by the provincial government of Odisha, had pitched to be part of the SPV for construction of the proposed mega steel plant in the province and had sought a majority equity holding of 51% in the joint venture (JV) with steel producers Rashtriya Ispat Nigam Limited (RINL) and NMDC Limited.
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