New Delhi, April 4: The Steel Authority of India Limited (SAIL) will invest Rs 11,262 crore to almost double the production capacity at its Bhilai steel plant to seven million tonnes per annum (mtpa).

The company’s board gave its approval to the proposed modernisation and capacity expansion at the Bhilai plant that has a capacity to produce 3.93 mtpa, SAIL said in a statement.

The public sector company, which plans to raise its total output to 23 million tonnes (mt) by 2010 from 14 mt, said it produced 12.6 mt of steel during fiscal 2006-07 ending March 31.

SAIL has appointed Mecon as the consultant for the expansion plan. This includes installation of a blast furnace, coke oven battery and a sinter plant. Post-modernisation, the Bhilai plant would become a 100 per cent continuous casting unit with the addition of a steel melting shop of 4 mt, SAIL said.

The Bhilai plant produces long steel products, including rails. The expansion plan envisages installation of a universal beam mill of 1 mt capacity to produce beams up to 1.1-metre depth.

A bar and rod mill of 0.9 mt capacity will also be added. To meet the growing demand from railways, a 1.2-mt rail mill will be installed, SAIL said.

The SAIL board has given an approval to investment proposals for expansion of the IISCO Steel Plant to 2.5 mt and the Bokaro steel plant to 7 mt.

In 2006-07, SAIL produced over 12.6 mt of saleable steel for the first time. About 500,000 tonnes of additional finished steel was produced by utilising 114 per cent of rated capacity of the available facilities — without the addition of any new major units — and by improving operational efficiency.

The captive mines of SAIL met 100 per cent iron ore requirement of the company’s steel plants by producing around 25 mt of the raw material during the year. Substantial growth was recorded in production of value-added items during 2006-07, according to SAIL.

A growth of 13 per cent was achieved in electrical sheets, 55 per cent in pipes, 15 per cent in TMT bars, 9 per cent in plates, and 4 per cent in railway materials. This, coupled with growth in production and techno-economic parameters, will help the company improve its bottomline, SAIL added.