Essar Steel to reach 12 million tonne pellet capacity at Paradip

Essar Steel aims to reach a pellet making capacity of 12 million tonnes per annum (mtpa) at its Paradip unit before the end of this financial year. The current capacity of the pellet plant is six mtpa.

"We are in very advanced stages of completing the expansion of the pellet project at Paradip. Once we are through with the expansion, it will be the single largest pelletisation complex in the country”, said an Essar Steel official.

Essar Steel runs the shore based pellet unit at Paradip using low-grade iron ore fines (58-63% Fe) beneficiated at its plant at Dabuna near Keonjhar. The beneficiated iron ore fines are transported through 253-km slurry pipeline.

In last financial year, the company exported 1.2 million tonnes of pellets. But gradually, Essar Steel will cut its pellet exports and use them for further value addition.

"We believe a lot of new steel capacity additions will be fuelled by pellets use. Once integrated steel plants buy pellets significantly, it will create a strong demand for the material”, the official said.

Pellet is an intermediate material in steel making which competes with iron ore lumps. The use of pellets in blast furnaces reduces coke rate and cuts downs on emissions of carbon dioxide by up to 85%.

Essar Steel's Paradip facility makes fluxed pellets that find use in multiple iron making technologies — Corex, DRI and blast furnaces. The cost of pellet production is Rs 3,300 per tonne.

The company has the largest pellet manufacturing capacity in the country at 20 million tonnes per annum (mtpa) followed by JSW Steel at 13 mtpa and Jindal Steel & Power Ltd (JSPL) with 9.2 mtpa.