After moves for merger with the Steel Authority of India Limited and the National Mineral Development Corporation have fallen flat, the Rashtriya Ispat Nigam Limited is now pinning high hopes to strike it rich by undertaking iron ore mining in Kukunoor area of West Godvari district.
Even as raw material security remained the topmost concern for RINL, the corporate entity of Visakhapatnam Steel Plant, is now banking on sourcing iron ore (with 63 per cent Fe) from West Godavari to meet part of its requirement once the Centre gives its stamp of approval. The State government had recommended to the Centre to give the mining lease in favour of RINL and the AP Mineral Development Corporation by floating a special purpose vehicle.
As per the survey conducted several years ago, the Kukoonoor block has about 25 to 30 million tonne.
“As it has spread towards Chhattisgarh and Odisha and the survey was made many years ago, we expect the reserves to be much more than the survey,” RINL Chairman-cum-Managing Director P. Madhusudan told The Hindu .
RINL once ramps up its 6.3 million tonne expansion project, its iron ore requirement will go up to 10 million tonne. It is also working on modernisation of blast furnace and sinter plant to raise its capacity by another million by 2016-17.
After RINL’s efforts for merger with SAIL and NMDC failed, the Navratna company signed an MoU with the APMDC for mining iron ore mines and setting up of a pelletisation plant at Bayyavaram in Khammam district before bifurcation. The carving out of Telangana State finally put a full-stop to the hope. However, Kukunoor, which was in Khammam was merged with AP post-bifurcation. RINL is totally dependent on NMDC to procure iron ore from its Bailadilla mines in Bastar district of Chhattisgarh.
Proposal to lay slurry pipeline
There is a proposal to lay slurry pipeline to Bastar as a joint venture with the NMDC.
While for SAIL and other major steelmakers the raw material cost accounts for 30 per cent of their production cost, RINL has to shell down 60 per cent as it does not have captive mines.
“We are hopeful that the mines in West Godavari will help us in easing our burden to a large extent,” Mr. Madhusudan said.
We are hopeful that the mines in West Godavari will help us in easing our burden to a large extent
P. Madhusudan
RINL Chairman-cum-Managing Director
