Tata Steel may scale up Kalinganagar capacity to 16 mtpa by 2025

To invest Rs 55,000 cr on expansion, pump in Rs 2,300 cr for Khandabandh mines

Tata Steel today said it intends to ramp up capacity of its Kalinganagar steel making facility to 16 million tonne per annum  (mtpa) by 2025 from six mtpa proposed originally.

"Our ultimate plan is to expand capacity of our Kalinganagar plant to 16 mtpa by 2025. The total cost of putting up a 16 mtpa facility would be around Rs one lakh crore compared to Rs 45,000 crore estimated for the six mtpa plant", said Rajiv Kumar, vice president (operations) of Tata Steel's Kalinganagar project.

In the first phase, Tata Steel is commissioning three mtpa capacity. This unit is scheduled to be inaugurated on November 18 this year.

Iron ore requirement for the first phase of the steel plant is pegged at five million tonne per year.

To firm up raw material supplies, Tata Steel has drawn up a plan to invest Rs 2,300 crore on scaling up capacity of its captive mine- Khandabandh iron ore deposits to five mtpa. The expansion is expected to be completed by 2017.

"Presently, iron ore from Joda mines will cater to our first phase requirement till 2017. The Khandabandh mines will meet our requirement from 2017 till 2020. Beyond that, we will have to look for more mines as our steel making capacity would go up to six mtpa", Kumar said.

He said, Tata Steel would bid for iron ore mines at the upcoming auctions.

The investment for the first phase of Tata Steel's Kalinganagar project is pegged at Rs 25,000 crore of which the steel maker had already invested Rs 22,000 crore.

Different units of the Kalinganagar plant would commence commercial production sequentially. Tata Steel has already started production from its coke ovens last month. The greenfield steel plant would have coke production capacity of 1.5 mtpa.

The steel firm has been alloted 3,470 acres of land for the Kalinganagar project. The plant would roll out high end flat steel products