Bhubaneswar, Dec. 18: Pohang Steel Co (Posco) today said it would begin construction of the first phase of its proposed 12-million tonne steel plant in Orissa in April 2008. The unit will be operational by December 2010.

The Posco board has decided that the plant would be constructed in three phases of 4 million tonnes per annum (mtpa) each against 3 mtpa that was originally mentioned in the MoU signed on June 22. Posco will increase the production in phases of 3 million tonnes each to 12 million tonnes by 2016.

The first phase of the construction is expected to be completed by December 2010, six months later than the original deadline of June 2010. This delay will be due to the increase in capacity. However, the total project will be completed ahead of the original schedule.

The investment for the first phase is approximately $3.7 billion (Rs 16,650 crore).