Barring Burnpur, no cost overrun in SAIL's expansion: Govt

The government today said except for a Rs 1,965 crore cost overrun in the capacity expansion of SAIL's Burnpur plant, there has been no cost escalation in the state-run firm's entire Rs 72,000 crore ongoing exercise.
"There has been no cost overrun except in ISP expansion where the cost estimate has been revised to Rs 16,408 crore against the earlier cost of Rs 14,443 crore..," Minister of State for Steel and Mines Vishnu Deo Sai said in a written reply to the Rajya Sabha.
The Rs 1,965 crore cost overrun accounts for a 13.6 per cent financial deviation, he said, adding that the main reason for cost overrun at IISCO Steel Plant (ISP) was an increase in civil and structural work of blast furnace and rolling mills among others.

To a query on whether the programme for expansion and modernisation of various steel plants of SAIL was lagging behind the schedule, leading to cost and time overruns, he said implementation of the work had been affected mainly due to unforeseen soil conditions encountered during execution and under estimation of quantities by the consultant, among other things.
"Progress of modernisation and expansion of plants are regularly reviewed at the level of Minister and Secretary in the Ministry," Sai said.
SAIL has undertaken modernisation and expansion of its plants located at Bhilai, Bokaro, Durgapur, Rourkela, Burnpur and special steel plant at Salem to enhance its crude steel production capacity in the current phase from 12.84 million tonnes per annum (mtpa) to 12.84 mtpa.

The minister said expansion project at Salem had been completed in September, 2010. At Rourkela, the entire new integrated process route including coke making, sinter making and iron making has been completed. Major facilities in other plants have also been completed.