No output in sight, Odisha CM to open Tata Steel plant

Blast furnace, sinter plant and steel melting shop at Kalinganagar yet to receive environmental clearance

Tata Steel’s Kalinganagar project is some way off from rolling out steel as Odisha Chief Minister Naveen Patnaik is set to dedicate the plant to the state today.

The blast furnace, sinter plant and steel melting shop for the first three million tonnes of the Kalinganagar project, all critical to steel making, are yet to receive clearance from the Odisha State Pollution Control Board. Only peripheral units like the captive power plant, coke plant and hot strip mill had received environmental clearance, officials said.

It will take another three months for steel to be produced from the Kalinganagar complex. Though work on the blast furnace, sinter plant and steel melting shop was almost complete, it would take time for the customary pre-operation heating process and stabilisation of the units, they added.

“We have already started commissioning process of the coke plant and the hot strip mill according to the plan and the next in line is the blast furnace, sinter plant and steel melting shop. After all, the plants are successfully commissioned, trial production would commence. As soon as we come to this stage, appropriate disclosures would be made”, a company spokesperson stated.

Informed sources attribute the haste in “commissioning” the plant to the state government’s desire to showcase the Tata Steel project. The Biju Janata Dal government is under attack from different quarters for its apathetic attitude towards facilitation of investment. Critics blame the government’s attitude for withdrawal of big-ticket steel projects like those of Posco and ArcelorMittal.

To draw all the political mileage from the project, the Odisha government has ensured no central minister or official is part of the ceremony. Presence of central government representatives would otherwise have been expected at a function where Tata Steel is unveiling its first integrated steel plant in the country in the last hundred years after Jamshedpur.

For Tata Steel it made sense to inaugurate the project before upcoming auctions of iron ore mines next month, according to RP Panda, an analyst. This puts the company at an advantage in mine auctions that accord priority to bidders with plants. Tata Steel already has eight captive iron ore mines in the state and is eying more deposits after the Kalinganagar project.

TV Narendran, managing director of Tata Steel, had last September set March 2015 as the deadline for commissioning the plant. Rajiv Kumar, Tata Steel’s vice-president in charge of the Kalinganagar plant, had in August said the plant would go on stream by December. Any further delay in launching the project would be embarrassing for the company, sources said.

Iron ore needed to run the steel mill is yet to reach the site. Tata Steel has said it will source ore for the project from its Khandbandh mines in Joda.

“The iron ore despatches have not started,” said SK Nayak, deputy director of mines, Joda circle.

The plant’s coke oven has started production from September and the hot strip mill has started operation by rolling slabs procured from Tata Steel’s Jamshedpur plant.