Posco To Invest $12 Bn In Orissa Steel Project

POSCO to invest $12 bn in Orissa steel project

Hindustan Times

18th December 2005

South Korean steel major POSCO said on Sunday it had finalised plans to invest $12 billion to build a 12 million ton plant in Orissa by 2016.

"Not only is the Korean investment the largest of its kind in India, it is the largest of its kind in the world. It is our biggest overseas venture and the Indian government has given its full support," a POSCO statement said. POSCO is the world's fifth largest steel maker.

POSCO plans to establish the plant as an "integrated steel works" capable of producing four million tons a year by 2010 and increase this in phases of three million tons each to 12 million tons by 2016.

The first phase is, however, likely to be delayed six months from the June 2010 schedule due to an increase in capacity and equipment changes. The final completion of the plant will be ahead of schedule, the company statement said.

In the "integrated steel works" concept, the entire process of melting, steel making and rolling occur together. The facility will also employ the innovative FINEX steel making method. This is a revolutionary process of skipping sintering and coke making - essential in blast furnace methods - to cut costs and reduce hazardous emissions into the environment.

POSCO will also develop a mine to provide 600 million ton of iron ore, or 20 million tons a year for 30 years, in Orissa's Keonjhar and Sundargarh areas.

The company is setting up a new port for transporting the plant's products as Orissa's lone port of Paradip will not be able to cope with the high volumes to be generated.

"India is expected to post the world's highest economic growth rate by 2020. Its growth potential is so high that the demand for steel is also expected to soar," the company statement said.

POSCO had on June 22 signed a memorandum of understanding (MoU) with the Orissa government to set up the plant in Orissa.

Since signing the MoU and setting up its Indian subsidiary in August
2005, POSCO has invested $51.3 million in the project.