Union Steel Minister Ram Chandra Prasad Singh inaugurated Jindal Steel and Power Ltd’s 1.4 million tonnes per annum (mtpa) TMT rebar plant at his integrated complex in the Angul district in Odisha.
According to JSPL, the capability is capable of producing India’s only 50mm TMT rebar used in construction and infrastructure projects.
The minister, who inaugurated the plant on Thursday, also inspected the operation of India’s first and only 2 mtpa direct-reduced iron plant based on coal gasification at the company. The coal gasification plant captures approximately 2,000 tonnes of carbon dioxide per day and remains essential to reducing JSPL’s carbon footprint.
Jindal Steel is expanding the capacity of its Angul plant from 6 mtpa to 12 mtpa and plans to reach an overall steel production capacity of 15 mtpa by 2025. Commissioning of the new capacities is expected to start within a year .
With the expansion of capacity, the company’s raw material needs must also be met. On the positive side, the company had won four blocks of thermal coal in recent auctions. The combined mining capacity of the mines is 15 mtpa (which can be expanded to 17 mtpa), which will make JSPL 100% self-sufficient in thermal coal and return to the pre-FY14 era.
However, various approvals before the start of mining can take some time. Nevertheless, the ramping up of supplies from these coal blocks should be in line with expansion plans. Analysts at Centrum Stock Broking said that “With the majority of approvals in place, we expect the Utkal B1 mine to be operational by the end of FY23 and others during FY23. 24.” The Odisha group of mines is located about 5-15 km from the Angul plant while Palma IV/6 railway station is also only 45 km from Raigarh, according to analyst data.
The company also manages its iron ore supplies. Tensa’s captive iron ore mines currently supply 25% of JSPL’s iron ore needs, analysts at Motilal Oswal Financial Services said. JSPL had won the bid for the Kasia mines at a premium of 118% over the IBM price to further secure its iron ore supplies. Expected iron ore grade at Kasia mines remains at 62.5% with reserves of 278m tonnes, analysts say
Overall, while the business has grown well and should maintain momentum, executing projects on time will be key.