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Tata Steel Orissa project on course

Calcutta, July 11: The Orissa venture of Tata Steel is all set to be the first among the high-profile greenfield integrated steel projects to get off the ground.

The company is set to place an order for a significant part of the equipment required in the first module.

B. Muthuraman, managing director of Tata Steel, said the company would place orders for blast furnace, sinter plant and coke oven unit in August.

“We are on course in Orissa. We have identified the mines and applied for mining lease to the state government,” he added.

Tata Steel had signed a memorandum of understanding with the Orissa government in November 17, 2004 to set up a 6-million-tonne plant at the Kalinganagar Industrial Complex at Duburi in Jajpur district.

It was the first of the three MoUs the company had signed, the other two being in Jharkhand and Chhattisgarh.

The development gains significance following Arcelor-Mittal’s decision to set up a 12-mt plant in Orissa after a delay in mine allocations in Jharkhand.

According to the agreement, the Orissa government will recommend Tata Steel’s mining lease after 20 per cent of the order is placed.

Orissa has signed 42 MoUs for steel plants, including a 12-mt project by Posco of Korea.

Posco, too, expects the state to recommend prospecting licence for mines to the Centre by the next month-end, its deputy managing director Tae Hyun Jeong said.

The first phase will entail an investment of Rs 6,000 crore.

The company was allocated 2,000 acres for the plant at Kalinganagar, which is fast becoming a hub for the steel industry in the state.

The state had faced stiff resistance while acquiring the land. Twelve tribal people were killed on police firing on January 2 when their protest turned violent.

Muthuraman, however, said the Jharkhand project could take longer.

The company had signed an MoU with Jharkhand government on September 8, 2005 for a 12-mt plant.

“Land acquisition is on there. The government will come up with a rehabilitation package,” Muthuraman said on the sidelines of the Tinplate AGM here today.

He said it could be at least one year from now before the company places order for the new plant there.

Mittal Steel has also signed an MoU for a 12-mt plant there in October 2005.

Tata Steel plans to increase its capacity to at least 30 million tonnes in the next 10 years.

Last week, Tata Steel shareholders approved a proposal to raise long-term funds of up to Rs 6,500 crore in one or more tranches to fund greenfield projects and strategic acquisitions.

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