Steel-major SAIL gets clearance for ₹1-lakh cr expansion plans, working on de-carbonisation strategy: Amarendu Prakash

The Steel Authority of India Ltd. (SAIL) has received “approvals” for its massive ₹1,00,000 crore capex plans - both greenfield and brownfield ones – which will see the state-owned steel-maker ramp-up capacities by approximately 75 per cent to 35 million tonnes per annum (mtpa) by 2030, company Chairman and Managing Director, Amarendu Prakash told businessline.

The company is also working on a “detailed decarbonisation plan” that will see it bring down its carbon footprint.”

“Approvals (at Board and Ministerial levels) for the ₹1-lakh crore capex has been received and we will start the work soon,” he said.

SAIL’s capex for FY24 was pegged in the ₹5,500-6,000 crore range and is expected to be ramped up as it looks at a greater capacity expansion.

Capex plans

The board has already approved a greenfield expansion plan for IISCO Steel Plant in West Bengal to hike capacity to 4 mtpa. Sources say the mill will produce higher grade hot rolled coil (HRC) and American Petroleum Institute (API) grade steel products for the oil and gas sector and steel for making automotive components. The new mill is expected to be completed in about four years.

IISCO’s current capacity is 2.6 mtpa of crude steel per year, converting 85 per cent of it to rebar, wire rods and heavy structural products.

For expansion at Bokaro steel plant, the pre-feasability report studies (PFR) have been completed and a consultant has been appointed for preparation of DPR, those in the know said.

Processes for brownfield expansion and modernisation at the Durgapur Steel Plant in West Bengal have been initiated and plans submitted in October. While a product mix is under-discussion, sources say there will be a new TMT mill of 1.4 mtpa coming up as part of the expansion plan.

Decarbonisation Strategy

A part of the capex will also go towards introduction of “new technologies” whereby embedded carbon emissions in steelmaking would be “substantially lower”.

So far, SAIL’s decarbonisation has been phased in three distinct time zones.

SAIL has already achieved around 20 per cent reduction in phase-I of decarbonisation. The company is now preparing time-bound action plans to achieve less than 2.3 tonnes/ tonne of crude steel of CO₂ emissions by 2030-31. Net zero emission target is set at 2070.

“Yes, a decarbonisation plan too is being worked out (simulataneously)and over the next one month, we will make it formal,” Prakash added.

Ramp up of Mozambique ops

Ramp-up of operations at Mozambique, where the company through its JV – International Coal Ventures Ltd (ICVL) – have access to coking coal mines is also under-consideration.

Capacities are to be doubled to 4 mtpa, as against the existing 2 mtpa.

“Some tests are under-way on determining the nature of the coal, the ash content and other factors. These should be through by August, after which ramp up in ops will happen,” he said.

Investments into ICVL, for this ramp up, was previously pegged at ₹1,500 crore.

Navigating imports

Prakash further added that the industry was keenly watching Chinese imports after the United States raised tariffs on shipments from Beijing.

The US President Joe Biden earlier this week announced steep tariff hikes on several Chinese imports including steel, leading Indian mills to fear that shipments from the top alloy producer will surge as other economies turn away.

Indian steel makers are already struggling with a glut of cheaper Chinese steel.

“Right now, the import scenario is changing every month. So we are keenly watching it after US hiked tariffs,” he said.