Odisha, Posco agree to set up 8-to-12 mtpa steel plant

BHUBANESWAR: Odisha government and Posco- India today agreed to set up an 8 mtpa greenfield steel plant near Paradip, downsizing the earlier plan of establishing a 12 mtpa facility.

This was stated by Chief Minister Naveen Patnaik and Posco-India CMD Y W Yoon after a marathon 90-minute discussion over the future of the proposed mega steel project which had been hanging in balance for last seven years.

We will start the project work as soon as the state government hands over 2,700 acres of land for setting up of 8 mtpa steel plant,” Yoon told reporters.

The company had so far been given only 500 acres of land for the purpose though the government claimed to have acquired about 2,000 acres, he said.

Posco-India which had proposed to set up a 12 mtpa steel plant near Paradip at an investment of Rs 52,000 crore, said to be the biggest FDI in the country, had failed to pick up due to various issues including stiff resistance from locals under Ersama block of Jagatsinghpur district.

Odisha government and the company had signed an MoU on June 22, 2005 to set up a 12 mtpa plant. However, both the parties agreed to downsize the capacity as the required 4,004 acre of land could not be acquired due to opposition from locals.

Asked about the company’s revised investment plan for the 8 mtpa steel mill, Yoon said “Our investment plan remains unchanged. However, we will review the cost as the construction proceeds.”

Patnaik also hoped that Posco-India would set up the steel plant like their plant at Pohang where clean and green coexisted with less environmental pollution. “The company will undertake adequate plantation in Ersama area in order to maintain greenery,” he said.

Patnaik hoped that a large number of local youths would get employment in the project.

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Posco India on Wednesday pressed for handing over of 2,700 acres of land to the company for start of construction of its much hyped project in the state.

The company also scotched all speculation about downsizing the project due to constraints in land acquisition. The speculation had gained ground after the South Korean ambassador, Kim Joong-Keun, who visited the state on May 2, said, Posco would a build a smaller size plant if there is problem in acquiring the full 4,004 acres for the 12 million tonne project.

However, Posco India CMD, Yong Won Yoon, who called on Chief Minister Naveen Patnaik here on Wednesday, told reporters after the meeting that the company is committed to build 12 million tonne steel plant in the state.

Our original plan of 12 million tonne is still there. We will be executing it in three phases of 4 million tonne each. After we take possession of 2,700 acres, we will start construction for capacity of eight million tonne. Once we receive the remaining land we will expand it to 12 million tonne,” Yoon said.

“Today we had a detailed discussion with the chief minister regarding our project. There were talks on land issues and we expect that very soon the land will be cleared,” he added.

Yoon said, as per the government statement, they have acquired 2,000 acres of land, but so far only 500 acres have been transferred to us. The remaining 1,500 acres still remain to be transferred.

Asked if the original investment estimate of 12 billion dollar investment will shoot up because of delay in implementation of the project, Yoon said, the project cost will vary at the time of execution. On the renewal of MoU, which has expired in June, 2010, the Posco India chief said, we have already revised our MoU in consultation with the state government and submitted the draft. It is upto the state government to decide.

Responding to a query on recent setback arising out of suspension of environmental clearance by the National Green Tribunal, Yoon said, “Now we are in talks with the Union Ministry of Environment and Forest. Once things are sorted out, we will get on a clear picture.

He also announced setting up of a training institute in Erasama block, near the project site, for training of youths in skills to be required for steel making.

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Bhubaneswar: Odisha government and Posco-India have agreed to set up an 8 million tons per annum (mtpa) greenfield steel plant near Paradip, downsizing the earlier plan of establishing a 12 mtpa facility, reports PTI.

This was stated by Chief Minister Naveen Patnaik and Posco-India CMD YW Yoon after a marathon 90-minute discussion over the future of the proposed mega steel project which had been hanging in balance for last seven years.

“We will start the project work as soon as the state government hands over 2,700 acres of land for setting up of 8 mtpa steel plant,” Yoon told reporters.

The company had so far been given only 500 acres of land for the purpose though the government claimed to have acquired about 2,000 acres, he said.

Posco-India which had proposed to set up a 12 mtpa steel plant near Paradip at an investment of Rs52,000 crore, said to be the biggest FDI in the country, had failed to pick up due to various issues including stiff resistance from locals under Ersama block of Jagatsinghpur district.

Odisha government and the company had signed an MoU on June 22, 2005 to set up a 12 mtpa plant. However, both the parties agreed to downsize the capacity as the required 4,004 acre of land could not be acquired due to opposition from locals.

Asked about the company’s revised investment plan for the 8 mtpa steel mill, Yoon said “Our investment plan remains unchanged. However, we will review the cost as the construction proceeds.”

Though the company is going to set up 8 mtpa steel plant in two phases now, Yoon did not rule out possibility of expanding the project to the original plan of 12 mtpa if additional land is made available.

“Time will tell what will happen in future,” Patnaik said replying to a similar question.

To a question whether the fresh agreement between the Odisha government and Posco-India would incorporate changes, Yoon said the company had already submitted its revised proposal.

The state government would take a decision on the revised content in the new agreement, he said.

On National Green Tribunal’s rejection of environmental clearance to the project, the Posco-India CMD said they were in consultation with the Ministry of Environment and Forest.

“Once the problem is sorted out, we will be able to say something in this matter,” he said.

Yoon, however, avoided question on issues of water and raw material which posed hurdle before the project.

“Actually, we held discussion on land issues and some other minor issues. When other issues are discussed, we can say something about this,” he said.

Since Odisha government believed in peaceful industrialisation, it would acquire rest of the land of the required 2,700 acres in consultation of local people, Patnaik said.

“We hope that acquiring another 700 acre of land will not be a problem,” the chief minister said, adding that the company today agreed to set up a training centre at Ersama for imparting skill education for the local youths.

[Sources — Economic TimesBusiness Standard & Moneylife]


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Odisha, Posco agree to set up 8-to-12 mtpa steel plant — 1 Comment

  1. Pingback: Odisha starts transferring 1,500 acres to Posco for plant | Mining Zone Peoples' Solidarity Group

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