OMC plans Rs318cr plant

The Orissa Mining Corporation (OMC), a state owned mining company, plans to set up a 2.5 million tonne per annum crushing system along with conveyance and mechanized wagon loading facility at its Daitari mines.

The project will require an investment of about Rs 318 crore which the corporation plans to finance from internal resources.

Pricewaterhouse Coopers (PWC) has been appointed as the transaction consultant for this project. The tender to engage a technical consultant for the project is now under the process. This is expected to be finalised soon, sources said. OMC is awaiting the approval of the project approval committee (PAC) headed by the chief secretary before going ahead with the project.

This is the second project to be taken up by the state owned mining company at its Daitari mines to raise the iron ore handling capacity. Daitari mine, well connected by rail and road, has the potential to augment its production from 2 million tonne per annum at present to about 6 million tonne.

While the mines owned by OMC has an estimated iron ore reserves of about 85 million tonnes, there is possibility of additional reserves of about 50 million tonne. At a production rate of 6 million tonne per annum, it can sustain for about 20 to 25 years. As a state owned company, OMC is obliged to meet the raw material (iron ore ) needs of the industries coming up in the Kalinga Nagar Industrial Complex (KIC), which located near Daitari.

So the company intends to execute two projects at Daitari mines to raise the production capacity. It intends to off load the present Ore handling Plant (OHP) at Daitari in favour of a private developer who will run the unit on build-own-transfer (BOT) basis. The tender for this purpose has been floated.

The selected private party will take over the OHP on “as is where is” basis and will make the required capital investment to produce about 2 million tonne of iron ore per annum. More than 20 parties are reported to have evinced interest in the bid. Secondly, it plans to implement the new crushing system along with conveyance and mechanized wagon loading facility at Daitari mines to augment the production capacity further.

This project expected to be completed in about 3 years time. OMC hopes to produce 5 to 6 million tonnes of iron ore from Daitari mines by the end of 2012 which will be sufficient to meet the raw material requirement of the industries in the Kalinga Nagar area. The state owned company has submitted a proposal to the state government for raising the production of iron ore to 24 million tonne by the end 2014. Out of it, the company expects 6 million tonne iron ore from Daitari alone, sources added.