State owned Iron ore miner NMDC-RINL signed a pact last year in May 2012, a joint venture to set up slurry pipeline and a pellet plant with an investment of INR 22 billion. The two firms signed a MoU in the presence of Steel Minister.
Essar Steel, JSPL and KIOCL have expressed interest in participating as the partner in the INR 22 billion joint venture between NMDC & RINL for setting up a Pellet plant & a 450 kms slurry pipeline.
NMDC has issued EOI (Expression of Interest), with reference to the same, Essar Steel, JSPL & KIOCL has responded.
NMDC-RINL has signed a MoU last year in May 2012 under the administrative control of the Steel Ministry. Later, NMDC wanted to introduce a third partner in the deal for operating the project & allow it some equity stake.
The 450 kms slurry pipeline aimed for transportation of Iron ore, it would run between Jagadalpur in Chhattisgarh to Visakhapatnam in Andhra Pradesh. Another project of setting up of Pellet plant has the projected capacity of 10 MnT pa.
KIOCL is believed to be the hottest contender of the deal, as Malay Chatterjee, Chairman & Managing Director, KIOCL, said the company has requisite experience & exposure to operate pipeline. Hence it is most suitable as the third partner of the pact. Though, JSPL & Essar Steel did not commented on development.
As per the sources, route survey of the pipeline shall be completed by the end of 2015. Also, matter concerned to induction of third partner would seek approval from Steel Ministry.
Total project investment is around INR 22 billion, out of which, INR 12 billion would be used to lay the 450 kms slurry pipeline & remaining INR 10 billion for setting up of Pellet plant of 10 MnT pa capacity. Slurry pipeline would be operable by 2015-16 & save transportation cost for the firms involved. It will be routed through national highways to avoid problems.
The pipeline would alleviate RINL’s expenditure on transport with increase in NMDC’s evacuation capacity. NMDC has plans to increase its production capacity from the Bailadila sector from current 25 MnT pa to 50 MnT pa.