JSPL to augment Oman plant capacity to 5 mn tonne by 2016

Jindal Steel and Power (JSPL) today said it will expand the capacity of its 1.5 million tonne steel plant in Oman to about 5 million tonne by 2015-16.

JSPL, through its wholly-owned subsidiary Jindal Steel & Power, Mauritius (JSPLM), had acquired Oman's Shadeed Iron & Steel Co. LLC (Shadeed) in July last year for $500 million, which started commercial production four months ahead of schedule in December 2010.

"We are pressing ahead with the next phase of expansion. Our plant will produce 2 million million of finished steel in the second stage and in the third phase, we are hopeful of producing 4-5 million million per annum of steel in the next 4-5 years time," JSPL Executive Vice President and Managing Director Naveen Jindal said.

Speaking at an event to dedicate the plant to the nation, Jindal said that the company was committed to creating more jobs, JSPL said in an e-mailed statement from Oman.

Jindal Shadeed has an important role to play in JSPL’s overseas expansion plans, it added.

The acquisition is a major step in the international strategic expansion for JSPL, which includes setting up of 1.7 million million steel plant, 6 million million DRI plant and 10 million million iron ore pelletisation plant in Bolivia with an investment of $2.1 billion (about Rs 9,500 crore), it added.

The gas-based plant at Sohar Industrial Port area was dedicated to the nation by Oman Commerce and Industry Minister Sheikh Sa’ad Bin Mohammed bin Said al Mardhouf al Sa’adi.

"This facility will support the strong demand for steel in the Middle East and North African countries, which has a supply shortfall estimated at more than 12 million tonne," the company said.

Shadeed's acquisition is significant for JSPL as the facility is engineered by world-renowned Kobe Steel (Japan) and Midrex (US), leaders in the field of direct iron technology, which the company plans to use in its domestic Orissa facility.

JSPL is undertaking expansion of its steel operations in India, which includes setting up new gas-based steel units.

At present, JSPL has an annual steel production capacity of 3 million tonne in Chhattisgarh. The size of the plant is being doubled at an estimated investment of Rs 10,000 crore. The company is also investing an estimating Rs 44,000 crore on two upcoming plants in Orissa and Jharkhand.