ArcelorMittal to spend $300mn on Orissa plant

It may be noted that the company, a few weeks back, had announced a similar R&R packages of 300 million dollars for its project in Jharkhand, where it has lined up another proposal to set up a 12 million tonne steel plant.

The R&R package of ArcelorMittal is significant in the context that South Korean steel major Posco, which had signed a MoU with the Orissa government for establishment of a 12 million tonne plant at Paradip one and half years before the Mittals came up with their Orissa proposal, is yet to finalise its R&R package quantifying the investment on this front.

Meanwhile, ArcelorMittal has presented its R&R plan to the Keonjhar district administration. It plans to spend the earmarked amount over a period spanning more than 5 years.

"We plan to spend about $ 300 million (Rs 1200 crore) for the R&R plan spanning over a period of more than 5 year. The R&R plan has already been submitted to the Orissa government", Sanak Misra, chief executive officer (CEO), ArcelorMittal India said.

After meeting the Orissa chief minister, Naveen Patnaik, along with Sudhir Maheshwari and Vijay Bhattanagar, the members of Arcelor Mittal's group management board in the state secretariat today, Misra told the media persons that the 12 million tonne steel plant will come up in two phases of 6 million tonne each.

He said, the R&R plan of the company is in conformity with the R&R policy of the Orissa government. It envisages dwelling units for each of the displaced family, common facilities, rehabilitation colonies with water supply, educational institutions, Primary Health Centres (PHCs).

Similarly, it will set up a state-of-art Industrial Training Institute (ITI) by the side of the steel plant. It is in discussion with 3 leading institutes of the country having previous experience in handling ITIs.

The model including the students strength and the cost of setting up the ITI is being worked out. He, however, made it explicit that the ITI will come up first before commissioning of the plant. It is in discussion with the state government for the required land.

Official sources said, the company plans to apply the highest standards of Corporate Social Responsibility (CSR) for the Orissa project and intends to make the R&R Policy the backbone of the CSR strategy.

The ArcelorMittal CEO said, the detail project report (DPR) of this integrated steel project prepared by MN Dastur & Company (P) Ltd (Dasturco) is being finalised. It will be submitted in June, 2008.

DPR includes captive mining facilities, captive power supply, water supply infrastructure and other required facilities. It also includes setting up of townships for the company's employees. He also expressed his satisfaction over the land acquisition saying that it is making good progress.

The company had signed a memorandum of understanding (MoU) with the Orissa government in December 2006 for setting up a steel plant at an investment of about Rs 40,000 crore.