Tata Steel will start construction on the Rs 23,500-crore phase two of its Kalinganagar steel plant in Odisha on Friday, staying firm in its commitment of expansion of the project despite its recent acquisitions.
Tata Steel managing director TV Narendran is expected to attend the ‘groundbreaking’ — a traditional ceremony to mark the first day of construction — of a 2.2 million tonne cold roll mill (CRM) on Friday, company officials said.
The CRM is planned for post-expansion annual production of 8 million tonne of crude steel and will allow Tata Steel to produce skin panels for car outer bodies from its newest plant, helping it retain leadership among domestic suppliers to auto and white goods sectors.
The mill will be capable of producing steel of tensile strength as high as 12,000 MPa (mega pascal) and plates of 18-70 metre wide and up to 3 mm in thickness, said Rajiv Kumar, vice president, operations, at Tata Steel Kalinganagar. “The average thickness of plates though will be of 0.25 -0.5mm,” he said.
With its Rs 35,200-crore acquisition of 5-million tonne Bhushan SteelNSE -1.89 % announced last month, Tata Steel has become India's largest steel producer.
Kumar said the Kalinganagar plant will focus on better serving automotive, pipelines, ship-building, yellow good (JCB, excavators) and oil and gas sectors. “Kalinganagar was conceptualised to be the most advanced steel plant anywhere in the world and we are trying to make the most of the facilities,” he said.
It is already making steel for solar panels, and HS 800 grade steel for newer fuel efficient vehicles.
“We were already producing X46 grade used for oil and gas pipeline, and trials are on for X70, the highest grade steel used in for oil and gas pipes,” Kumar said. “Trials of steel for long water and slurry pipelines are also underway.”
The company is in the certification process with pipeline major Welspun Group.
Kalinganagar has begun supplying tubes — the telescopic fronts of motorcycles on which the handles rest – to Chennai based Tubes India which was earlier totally import dependent, said Kumar. Tata Steel's newest facility is also able to offer superior experience of existing market products. “For example, you get 70 cylinders per tonne of HR coil produced here against the 63 cylinders from coil produced at Jamshedpur.”
Kumar has been focussed on ramping up production, which began in May 2016, to three million tonnes annually. The “blip” that prevented it achieving full capacity last fiscal is behind them, he said. “March, April, May, June, every month we’ve produced 250,000 tonnes, which works out to an annual production of three million tonnes,” he said. Work is to soon begin on a state of art galvanising line, a continuous annealing line and another blast furnace that will add the five million tonnes to its capacity.
Kalinganagar, spread over 3000 acres of land in Jajpur can accommodate a 16 million tonne plant, according to Kumar. Long-term raw material security was another story he would not be drawn into. “All I know is I have been promised raw material,” said Kumar.
Source: The Economic Times
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