SAIL, Afripalm sign MoU for South Africa steel plant

State-run Steel Authority of India (SAIL) today said that it has entered into an agreement with Afripalm Resources to carry out a feasibility study for setting up a steel plant in South Africa.

"We have entered into a MoU with Afripalm, a company in South Africa. It is a general MoU to carry on a feasibility study for setting up a steel plant," SAIL Chairman C S Verma told reporters on the sidelines of a function here.

The agreement was signed two months back, the Chairman said.

"The matter has been discussed in the Board and minutes are under finalisation," Verma said.

The SAIL Chairman, however, refused to divulge further details.

Earlier in the week, Johannesburg-based Business Day had reported that SAIL has signed an agreement with Afripalm Resources to set up a steel plant in South Africa at an investment of $2.94 billion.

Quoting Zim, Chairman of Afripalm, the newspaper had said that Afripalm's subsidiary, Afripalm Horizons, was working with SAIL to identify a site for the mill that would either be based near the coast to facilitate exports or near iron-ore producing areas.

SAIL had earlier said that it intended to set up four 3 million tonne per annum steel manufacturing facilities -- one each in Indonesia, Mongolia, South Africa and Oman -- at a cumulative investment of $12 billion.

The proposed plants would cater to the local need, he had said, adding that the company aims to finalise all the plants in 2011-12.