NMDC eyes ArcelorMittal land for Odisha steel project

The mining company is in talks with Idco to avail the land and other clearances

Central government undertaking NMDC Ltd, which has evinced interest to set up a mega steel plant project in Odisha, has proposed to use the government land earmarked for abandoned ArcelorMittal project for construction of its proposed steel plant.

The mining company is in talks with Odisha Industrial Infrastructure Development Corporation (Idco), the land acquiring agency of state government, to avail the land and other clearances, sources said.

“The two parties have agreed to use the government land identified for ArcelorMittal. Talks are still going on about role of Idco in the proposed joint venture for the steel plant and it is expected that a MoU will be signed within a month or so after sorting out certain issues,” said a source involved with the negotiation process.

It has been proposed that the Odisha government will hold stake in the steel plant in lieu of the land provided by it, he added.

Idco has 2,847.50 acres of government land in Keonjhar earmarked for the scrapped proposal of ArcelorMittal. NMDC is interested to use the area for its proposed plant because of Malangtoli iron ore deposit, owned by PSU Odisha Mining Corporation (OMC), is situated in the same district.

The Centre had allocated Malangtoli mines in favour of OMC in 1992 after NMDC failed to explore the reserve, with estimated deposit of nearly 150 million tonne iron ore.

Though NMDC has not discussed about the capacity of the proposed steel plant, it can be safely assumed that the capacity would not exceed six million tonne per annum based on the land size demanded by the company.

The central government PSU has expressed interest to set up Ultra Mega Steel Plants in four mineral rich states such as Odisha, Jharkhand, Chhattisgarh and Karnataka in line with Ultra Mega Power Plant project of Union power ministry.

As per the original plan of Union mines ministry, it would facilitate land, iron ore linkage, coking coal, power, water required for the project by forming a special purpose vehicle with the respective state governments and would later handover the operation of the steel plant to a private entity via auction route except for raw material linkage.

In case of Odisha project, OMC will act as the raw material provider for the project, but may not have any stake in the project, the source said.

The tripartite agreement between Union ministry of mines, NMDC and Idco will be signed sometime in September in the presence of Central steel minister G Mohan Kumar. Before the signing of the agreement there will be at least two meetings to sort out roles of each partner, said the source.