By Bizodisha Bureau, Bhubaneswar, May 23, 2018: Even as ArcelotMittal could not be able to set the much publicized mega greenfield steel project in the state, its joint venture with Steel Authority of India (SAIL) seems to have zeroed in on Odisha for an automotive grade steel plant.

In a letter to Odisha industries secretary Sanjeev Chopra, SAIL has evinced keen interest to locate the auto grade steel facility in the state.

“The decision of site selection for the proposed unit would be taken based on the advice of relevant experts, and after conducting due diligence taking into account the location, availability of manufacturing inputs, infrastructure and facilities as well as incentives and benefits made available by the respective state government. We appreciate your proposition and would keep Odisha as a prospective site to be considered for the proposed unit”, the letter said.

The JV has been scouting for a suitable location for the project, for which a joint feasibility study is underway. In May 1015, ArcelorMittal and SAIL entered into memorandum of understanding (MoU) to explore the possibility of setting up an auto grade steel manufacturing facility. The size of the deal is estimate at Rs 15000 crore. Initial capacity of this plant is envisaged at 1.5 million tonne per annum (mtpa) which can further be expanded to 2.5 mtpa.

Odisha has a strong case for hosting the proposed auto grade steel facility since inputs for the plant are to be sourced from the new hot strip mill at SAIL’s Rourkela unit, thus making the entire value chain indigenous. The proposed JV plant will construct world-class facilities for manufacturing automotive steel that will offer technologically advanced steel products for India’s rapidly growing automotive sector.

However, ArcelorMittal had a bitter experience of not having succeeded to set up 12 million ton per annum green field steel plant in iron ore rich Keonjhar district. But, long delays in land acquisition, uncertainty in securing captive iron ore deposits and law and order problems virtually compelled leading steel maker to withdraw from setting up of Odisha plant in 2013.