Naveen Jindal-owned Vulcan Green Steel is planning a $3-billion investment in Nigeria where it intends to set up a three-million tonne per annum (mtpa) steel plant.

In an official communication earlier this month, Nigeria’s President Bola Tinubu said that Jindal Group has committed to investing in the African nation.

Incidentally, sources aware told businessline that the investment will be made through a promoter group entity Vulcan Green Steel. Details of the project are yet to be finalised. As per people in the know, Vulcan will set up a hot-rolled coil mill in Nigeria.

Money could be raised through Export Credit Agencies (ECAs), which offer trade finance and other services to facilitate domestic companies in international exports. Most countries have ECAs that provide loans, loan guarantees and insurance to help eliminate the uncertainty in exports.

“Nigeria has a population of 22 crore and steel demand is expected to grow at 8-10 per cent year on year over the next few years. There are no major players and it gives us a scope to invest in the market,” people close to the development said.

Other details such as mines linkage, power connectivity and land availability are being discussed with the government there.

Green steel project in Oman

Meanwhile, Vulcan Green Steel will commence work on setting up the proposed 5-mtpa green hydrogen-ready green steel complex in the Special Economic Zone at Duqm in Oman. The investment is expected to be in the $3-billion range and discussions are on with ECAs for fund raising.

The facility will produce premium-quality, auto-grade flat products catering to the auto, wind turbine and domestic appliances for industries across Europe, Japan and other countries.

“We expect about 7-9 gigawatts of renewable energy to be required to run the facility at full capacity, including the electrolysers and the electricity needed for the steel manufacturing facility,” sources said.

Those in the know said Vulcan Green Steel is in advanced discussions with multiple developers to secure the energy requirement.

“The company, in due course, will evaluate the optimum mix of debt and equity to maximise shareholder value and minimise the cost of capital,” sources said.

businessline has reached out to Jindal Steel and Power for comments and is awaiting a response till the time of this article going to press.