Vedanta Resources draws up $4-billion plan for Electrosteel Steels
Kolkata: Diversified metals and mining major Vedanta Resources plans to pump about $4 billion into newly acquired Electrosteel Steels to scale up its capacity from the existing 1.5 million tonne per annum to 7 mtpa in the coming years.
Anil Agarwal, chairman of Vedanta Resources, said he would initially invest about $300 million in the next two years to augment the capacity of Electrosteel to 2.5 mtpa.
Vedanta will also set up a mega steel project adjacent to the existing Electrosteel plant in Bokaro, entailing an investment of $3-4 billion. “We will be doing it (second plant) in the same area because it’s always good to have synergy,” Agarwal told reporters.
The new plant will be part of Electrosteel and will come up in three years once the company receives the necessary clearances. Along with the existing plant, Electrosteel has around 2,200 acres but will be making fresh acquisitions as more land will be needed. “Altogether, the steel capacity will be 7 mtpa,” Agarwal said, implying that the new plant will have a capacity of 4.5 mtpa. “We are talking to the Japanese, Koreans and Chinese for machinery, technology and others,” he added.
Vedanta has an iron ore mine in Jharkhand, which can possibly feed this project.
This project is expected to generate direct employment of 60,000 and an equal number of indirect employment.
Earlier this year, Vedanta was declared the successful applicant for the stressed assets of Electrosteel under the corporate insolvency resolution process. Thereafter, it overtook managerial control of the firm and a new board was put in place.
Oil & gas tops the agenda. Laying its primary focus on the oil and gas segment in the near term, Vedanta, the world’s sixth-largest diversified natural resources conglomerate, has lined up a $ 4-5 billion investment to scale up its oil production four times the current output.
“At the moment, we are producing around 200,000 barrels (a day). With the first phase of whatever adjusting field we have, we will produce up to 500,000 barrels (a day) in two years. And with the new blocks we have got in Assam, Rajasthan, Kutch area in Gujarat and Tamil Nadu, we will produce another 500,000 barrels. So, it’ll take our total production to around a million barrels (a day),” Agarwal said.