BHEL may not join RINL, MECON for Rs 2,000-cr steel unit

Power equipment maker Bharat Heavy Electricals Ltd (BHEL) may not join hands with steel maker Rashtriya Ispat Nigam Limited (RINL) and MECON Ltd for the proposed Rs 2,000-crore joint venture that plans to set up a factory at Vizag for manufacturing steel for core sectors.

Sources in the know said BHEL has expressed its unwillingness to be a party in the venture at a meeting with steel secretary D R S Chaudhary last week. “BHEL is not keen on setting up any such manufacturing unit as it already has factories for manufacturing equipment for power, auto and rail sectors at Trichy, Ranipet, Haridwar, Hyderabad, Banga-lore and Bhopal,” a source said.

“It (BHEL) does not find the proposition viable at this point in time,” the source added.

MECON is a state-run engineering and consultancy firm offering full range of services required for setting up of a core sector project from concept to commissioning, including turnkey execution.

State-owned steel maker RINL was mulling to form a joint venture with BHEL and MECON for putting up a high-end seamless tube mill at Visakhapatnam in Andhra Pradesh, entailing an investment of Rs 2,000 crore.

The facility was proposed to have four lakh tonnes per annum seamless tube installed production capacity. High-end seamless tubes find application in energy, oil and gas and water sectors among others.

The current crude steel production capacity of the country stands at 72 mtpa. The government plans to enhance the output to about 140 mtpa by the end of the current five year plan (2012-17).