SAIL Chairman assures full investment support to MEL for new facilities

The management of Maharashtra Elektrosmelt Ltd. (MEL), the only subsidiary of Steel Authority of India Ltd. (SAIL), has been advised by SAIL Chairman Mr. C.S. Verma to draw up an expansion plan with the objective of ensuring fulfillment of 100% requirement of ferro-alloys of SAIL’s integrated steel plants which are currently in capacity expansion mode. Higher ferro-alloy production by MEL would go a long way in meeting the raw material security concerns of SAIL. MEL, in Chandrapur, Maharashtra, is India’s largest manganese-based ferro-alloys producer with a product-mix that includes carbon ferro-manganese (FeMn) and silico-manganese (SiMn). The process of the company’s amalgamation with SAIL is in its final stage.

Mr. Verma, who visited Chandrapur last weekend to firm up MEL’s annual business plan, indicated that MEL’s expansion plan should provide for setting up of two new furnaces (the process for installation of one 45 MVA submerged arc furnace at MEL is currently being finalised) not only to cater to the post-expansion requirements of the SAIL plants, but also of other steel plants in India. The total investment outlay would come to about Rs. 500 crore. Addressing a large gathering of MEL employees during his visit, Mr. Verma said that MEL should also explore the possibility of setting up facilities to produce ferro-nickel for the SAIL plants. Pointing out that MEL is on its way to becoming a SAIL unit, Mr. Verma assured that  funds for expansion of MEL would not be a constraint, with SAIL extending full support.

Power constitutes about 35-40% of the cost of production of ferro-manganese. In view of this, SAIL is also planning to set up a power plant consisting of two 45 MW units at MEL. This will entail additional investment of around Rs. 500 crore.

Post-expansion requirement of ferro-alloys by the SAIL plants would be to the tune of 375,000 tonnes. At present, MEL meets the SAIL plants’ entire requirement of FeMn and about a third of the requirement of SiMn from two 33 MVA submerged arc furnaces. With addition of the 45 MVA furnace, production of SiMn would nearly double, but still fall short of the SAIL plants’ total requirement. A fourth furnace would not only eliminate the shortfall but provide capacity to meet SAIL’s future needs as well.

SAIL is already preparing its Perspective Plan for the year 2020. Mr. Verma has directed MEL to keep SAIL’s plan in view and chart its own Perspective Plan and the roadmap ahead.