SAIL to double iron-ore production of its Bolani mine

05 December 2016

Steel Authority of India Limited (SAIL), the country’s largest integrated steel producer, will double the production capacity of its Bolani iron-ore mine in the eastern Indian province of Odisha.

The capacity of the mine will be ramped up to ten-million tons a year over the next four years from its current capacity of five-million tons a year, entailing an investment of about $34-million.

The expansion of Bolani is crucial to maintain future raw material security. The mine is an important source of supply to SAIL’s steel mills at Rourkela, Durgapur and Bokaro, a company official in the raw materials division has said.

Besides Bolani, SAIL has also started an expansion of its Barua and Kalita mines to double their production to four-million tons a year each, from two-million tons a year.

Elaborating on the importance of enhancing raw material security, the official said that SAIL, which has five integrated steel mills under its fold, would achieve hot metal production of about 23.1-million tons in the current financial year. This will increase to 50-million tons a year by 2025, which will require matching increases in production from its captive raw material assets.

Meanwhile, the company is expected to select, over the next few weeks, a mine developer and operator (MDO) for its 15-million-ton-a-year iron-ore mine at Rowghat in the central Indian province of Chhattisgarh.

SAIL has invited offers from domestic and international MDOs for the development of the Rowghat mine, which has an estimated reserve of more than 500-million tons of iron-ore. The company will offer an MDO for a five-year period for construction and development of the reserves and a production agreement for the subsequent 25 years.

SAIL has been seeking an MDO since early 2015 and previous MDOs, which had submitted offers, withdrew at the prebid conference stage, owing to concerns about law and order at the location.

The development of the Rowghat mine is critical for supply for the Bhilai steel plant. However, the area where the iron-ore reserves are located in is violence plagued and disruptions by ultra left extremists in the largely forested region, led to previous MDOs balking at taking up the project.

After a series of consultations with provincial government and the federal Ministry of Home Affairs, the central government has deployed large contingents of paramilitary forces specialised in combating extremists. This should bolster confidence among MDOs to go ahead with the project.

Source – Mining Weekly