State-run firms NMDC and RINL may have to change location of their Rs 1,000 crore pellet plant project from Vizag to Chhattisgarh following the state government’s insistence, according to a source.

The Chhattisgarh government wanted the location of the plant to be changed as the four million tonnes per annum (mtpa) pellet facility would be using iron ore produced in the state for value-addition, the source added.

NMDC and RINL had in 2012 signed a pact for setting up a pipeline to carry iron ore from Jagadalpur in Chhattisgarh to Visakhapatnam and proposed to set up the pellet plant at the site in Andhra Pradesh.

The total investment in these two proposed projects was envisaged at Rs 2,200 crore including Rs 1,000 crore for the pellet plant.

The investment in the pellet plant may go up as the two firms have now proposed to increase the capacity to six mtpa from 4 mtpa earlier.

Similarly, they have also decided to enhance the capacity of the slurry pipeline form 10 mtpa earlier to 13 mtpa now.

RINL has a long-term agreement with NMDC for its iron ore requirement, which is being met from NMDC’s Bailadila mines, and is transported mainly through railways.

The pipeline would ease RINL’s expenditure on transport and at the same time, increase NMDC’s evacuation capacity.

NMDC has plans to increase its production capacity from the Bailadila sector from current 25 mtpa to 50 mtpa. The pipeline is to increase NMDC’s evacuation capacity.

“About 50 per cent of the route survey work has been completed and the draft report submitted. MECON is now working on revised techno-economic feasibility report for the pipeline and the pellet plant,” the source said.

Related Topics