OMC to outsource services for OHP

The Orissa Mining Corporation (OMC), the state owned mining company, will float an open tender in next 10 to 12 days for outsourcing the operation and the maintenance of its existing Ore Handling Plant (OHP) at Daitari.

It has obtained the permission of the Orissa government for floating the open tender.

“We have obtained the approval of the state government and the tender will be floated in next 10 to 12 days”, Santosh Kumar Sarangi, managing director, OMC told Business Standard. Though the installed capacity of the existing plant is 2 million tonne per annum, it has been operating at about 25 percent of its installed capacity since its inception in 1974.

With a view to raise the ore handling capacity to about 5 to 5.5 lakh tonne per annum, OMC has decided to outsource the service. Sarangi said, the Ore Handling Plant at Daitari will be given on a long term contract basis to a contractor on a build-operate-transfer (BOT) basis with the BOT contractor making all the capital investment estimated to be around Rs 60 crore.

OMC will repay to the contractor on per tonne remuneration basis. The per tonne charge will depend on the quantity handled and the bid price of the contractor. While the cost of production per tonne of ore handled by the OHP is about Rs 600, it hopes to bring down the cost.

The lowest cost bidder will be given the operation and maintenance of the OHP unit on contract basis, he added. The company’s decision to outsource the service and enhance the capacity of the ore handling plant is driven by the necessity to ensure the supply iron ore to the upcoming steel projects in the state. Feedback Ventures Limited was appointed as the transaction consultant for this initiative.