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Weak steel market to delay Mesco-Posco Finex deal

Both Posco and Mesco have mutually agreed to delay the project till the steel industry revives

Nirmalya Behera  |  Bhubaneswar 

Steel makers
Steel makers

The transfer of Finex, a technology patented by Posco, to is now kept at bay because of the slow down in the industry. Both Posco and have mutually agreed to delay the project till the industry revives.

"The kind of technology they wanted to bring is too expensive and industries is not doing well. There is mutually agreement we will not do it for some time till the industry gets up", said Rita Singh, chairperson cum managing director of

To facilitate the transfer of Finex technology, both and Posco had signed a memorandum of agreement in March 2015. In a statement, had said Posco would have 26 per cent equity in the joint venture (JV) project.

Noted consultant Dastur & Company was roped in to study the modalities of the technology patented by Posco.

Since the Finex plant requires a lot of oxygen and power, has already initiated talks with some for setting up auxiliary plants on the JV route. The Finex plant during operation would need a running 100 Mw captive power plant (CPP) and an oxygen plant of 1000 tonne per day (tpd) capacity.

Finex process is expected to cut hot metal production cost for by Rs 2000-2500 per tonne.

Finex technology, developed exclusively by Posco, is the process to smelt iron ore without using expensive coking coal. As the process uses normal coal abundantly found in Odisha, it will reduce the cost of production for hot metal.

It was agreed upon that both Posco and would enter into a definitive pact for transfer of Finex technology. After that, the process of dismantling of Posco's Finex plant in Korea and its subsequent installation at premises would take off.

Mesco's Kalinganagar plant has a pig iron making facility of 1.2 million tonnes per annum (mtpa). It hopes to achieve making capacity of 3.5 mtpa in two phase. Group has taken over Maithan Ispat Ltd since 2015 which has capacity of one million tonne.

First Published: Sat, October 28 2017. 22:44 IST