SAIL Has Mega Investment Plans In Jharkhand

It has been very long wait for the town-folks of Sindri, almost a decade has passed when famous Sindri Fertilizer Plant was shut down in March 2002, bringing to halt a major economic activity of not only town but entire region.  Now the revival of Sindri Unit of the erstwhile Fertilizer Corporation of India seems imminent, more so with the approval of the Cabinet Committee on Economic Affairs (CCEA) on 5th August 2011 of Steel Authority of India’s (SAIL) proposed plans to breathe life into the non-operational fertilizer unit. SAIL has earlier proposed the setting up of Steel, Power and Fertilizer Plant at the site.

Steel Authority of India Limited
Steel Authority of India Limited

Sharing information about the mega-investment plan, SAIL Chairman C.S. Verma said, “We are planning to create a dedicated project office to monitor the different areas and expedite the Sindri project within 42 months of getting all clearances.” At Sindri, total land available with Fertilizer Corporation of India Limited (FCIL) is about 6652 acres and for the proposed project 5481 acre of land is available to SAIL.

In this ambitious industrial project, SAIL proposes to revive and set up a 1.15 million tonne per annum (mtpa) gas-based Urea Plant with an investment of Rupees 4000 to 5000 crore. For setting up this unit, SAIL is scouting for a suitable partner, as it involves dismantling and disposing of the present Fertilizer Plant. Sharing the details of the take-over of the Fertilizer Plant, C.S. Verma said, “Once we get full possession of the Plant, we will take it as zero date and from that date we will complete the entire work within 42 months.” He also told the journalists that SAIL is taking necessary measures and committed to hold on to the schedule.

In addition, SAIL plans a Greenfield Integrated Steel and Power Plants with an investment of Rupees 26000 crore and Rupees 4000 crore respectively. The proposed 5.6 mtpa Steel Plant shall have diversified flat product mix targeted at the high end steel market; also it shall have 4.2 MT (million tonne) capacity for hot rolled products and 1.2 MT for cold rolled products. SAIL proposes to set up a special purpose vehicle (SPV) for the mega-project; it is likely to have three subsidiaries to manage Fertilizer, Steel and Power Plants.

In the recent Monsoon Session of the Parliament, Steel Minister Beni Prasad Verma has stated that 6019 families in Bokaro (Jharkhand) were shifted from the SAIL’s project site and SAIL has provided employment to about 16000 people at Bokaro. The minister said, “The requisite amount of compensation on account of acquisition of land has been deposited with the respective state governments as rehabilitation of displaced persons is a state subject and the land for setting up of SAIL steel plants was acquired by the respective state governments.” According to the terms and guidelines set by the Supreme Court of India for the employment of displaced persons, the project-affected people were given preference in the employment.

SAIL anticipates that mega-project at Sindri is going to generate job-opportunities for at least 5000 people. We would certainly like the local people of the town Sindri and Dhanbad district to take up bulk of these jobs in the proposed project, as that would be right thing to do for SAIL; maybe SAIL would do well to ensure that by taking the necessary steps in the right direction, as reiterated by the Minister.

To keep up with the expansion and the modernization plans, SAIL also proposes to invest about than Rupees 10264 crore towards the development of its iron ore mines. After SAIL’s expansion, their iron ore requirement would go up from the present 23.2 MT to 39 MT; and their entire iron ore requirement would be met from captive sources. They stressed that they do not need to purchase iron ore from outside. SAIL presently has 7 major iron ore mines, 4 of them are in Jharkhand while remaining 3 are in Orissa to supply the ore.

In the Financial Year (FY) 2011, SAIL got security of raw material supplies. The grant of forestry clearance by the Ministry of Environment & Forests (MoEF) for Ajitaburu, Budhaburu and Sukri-Latur leases of Chiria iron ore mines in Jharkhand in March 2011, provided the ground for assurance of around 40% of the iron ore requirement of SAIL over the next 50 years being met; the company believes that they have got captive iron ore reserves of 3.5 to 4 billion tonnes (BT) to take care of their iron ore need.

Meanwhile, SAIL has already initiated actions for development of state-of-the-art mechanised mines in Chiria, initially with a capacity of 7 mtpa. For this, it has appointed a consultant of global repute – M/s Hatch Associates of Australia – for preparation of a detailed project report (DPR) that will provide the best beneficiation technologies available in the world today for efficient use of iron ore. The estimated cost for development of the Chiria mines is about Rs. 5,000 crore. By 2014, the company plans to start mining from Chiria Mines located in the West Singhbhum District of Jharkhand.

“We are fully dependent on Chiria mines for all our future expansions. More than 40% of the iron ore requirement of 100 MT is going to be sourced from there; in fact the mine will be a lifeline for SAIL, as reserves in other mines have been depleted. The Chiria mine will become operational in the next three years,” C.S. Verma told journalists. With iron ore reserves of 1.8 billion tonne, Chiria mines in Saranda Forest is one of the largest iron ore mines in Asia; however, one of the hurdle is the Naxals’ threat in the region where mine is located. And one can not forget the threat to invaluable flora and fauna of the Saranda Forest region, besides the local Adivasi Communities living near the Chiria mines.

It may be noted that earlier this year, in February, Jairam Ramesh, the then Environment Minister had given his approval for the forest clearance for Chiria, after overturning the Forest Advisory Committee’s (FAC) recommendations. The Minister had justified his decisions by citing the good track record of the SAIL in corporate social responsibility (CSR). However, the Minister also put conditions to the approval, for instance commitment of Rupees 20 crore investments in improving wildlife and setting aside 2% of its net profit towards CSR of the region.

Replying to the queries on how the riders would impact development of Chiria, Verma said, “We are already complying with these conditions. In fact, what we are doing is much more than the mandatory requirement of CSR.” Earlier this year, in February 2011, SAIL received the maiden Wockhardt Shining Star CSR Award in the Iron & Steel Sector category. In his acceptance speech, Mr. Verma said “SAIL contributes to society through its schools, hospitals, health centres, sports academies and other activities. In fact SAIL’s annual spend on CSR activities goes much beyond the stipulated 2 per cent of distributable surplus.”

We do not want to sound sceptic at this point of time, as we would certainly like to see the fruits of SAIL’s CSR activities reaching the local population residing in the Chiria mines region, as promised in no uncertain terms by the company.

Team Focus

Team Focus

We are bunch of commoners and our bloggers' e-magazine focuses on the AlterNative Voices from Jharkhand, India.
Team Focus
Team Focus

Written by

We are bunch of commoners and our bloggers' e-magazine focuses on the AlterNative Voices from Jharkhand, India.


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