To ensure raw material supply to its plants, Jindal Steel BSE 3.97 % and Power may bid for iron ore mines in Odisha in forthcoming auctions, which are scheduled to start in October-November this year.
The Naveen-Jindal led firm, which plans to expand the prodcution capacity of its plant here from 2 million tonnes per annum (MTPA) to 6 MTPA by the end of next year, is battling raw material security at present.
“We may decide to go for auction when it happens in Odisha. We are evaluating at present. We will see whether we can buy iron ore from market or participate in auction as Odisha is one of the richest states in the country when it comes to availability of iron ore,” a senior company official told PTI.
The 12 mineral-producing states, including Odisha, will auction 82 mining blocks that contain minerals such as iron ore, bauxite, limestone by October-November this year.
The government passed a new law (MMDR Amendment Act, 2015) in March this year to pave way for auction of iron ore and non-coal mineral mines in states.
To secure raw material supply, JSPL is also exploring other options such as slurry pipelines for ore from Barbil and Paradip to Angul, an official said, adding that the two pipelines may cost a total Rs 900 crore.
“The company is planning a slurry pipeline for the Angul Plant from Barbil for a total stretch of 202 km which may cost about Rs 600 crore. This is under evaluation stage,” the official said, adding slurry pipeline, if finalised, will reduce the transportation cost significantly.
He said the company is confident that in another five to six months permanent solutions would be arrived at and decisions would be taken as management is considering various options.
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