SAIL approves Rs. 11262-crore modernisation & expansion of Bhilai Steel Plant - Record saleable steel production, capacity utilisation in 2006-07

Press Release
New Delhi

The Board of Steel Authority of India Ltd (SAIL) has given in-principle approval to a proposal for modernisation and capacity expansion of Bhilai Steel Plant (BSP) to 7 million tonnes (MT) of crude steel per annum at an indicative cost of Rs. 11,262 crore. At present, BSP has the capacity to produce 3.93 MT of crude steel.

MECON has been selected as consultants for BSP’s modernisation & expansion plan that includes installation of a new blast furnace that will be among the biggest in the country, a new 7-metre tall coke oven battery and a new sinter plant. Under modernisation, the ingot route will be phased out and BSP will become a 100% continuous casting plant with addition of a brand new steel melting shop of 4 MT capacity.

BSP is a major producer of long steel products, including rails. To enhance its core strength in long products, the approved expansion plan envisages installation of a universal beam mill of 1 MT capacity to produce beams up to 1.1-metre depth, which will be the only one of its kind in India. A new bar & rod mill of 0.9 MT capacity will also be added. Moreover, to meet the growing demand of the Indian Railways, a new universal rail mill of 1.2 MT capacity with state-of-art technology will be installed. BSP also has unique strength in production of wider plates, and its dominance in this product category will be maintained by capacity expansion of its Plate Mill to 1.42 MT under the plan.

Modernisation and expansion of BSP is an integral part of SAIL’s growth plan that envisages capacity augmentation to around 23 MT of crude steel by the year 2010. The SAIL Board has already given in-principle approval to investment proposals for expanding the crude steel capacity of IISCO Steel Plant to 2.5 MT and of Bokaro Steel Plant to 7 MT. In addition, Salem Steel Plant’s capacity will be doubled to 3.5 lakh tonnes of stainless steel. A large number of international technology and equipment suppliers have shown keen interest in these expansion projects. Orders for the projects are presently being finalised.

New heights in performance

Meanwhile, SAIL ended the year 2006-07 with a new record performance with production of over 12.6 MT of saleable steel for the first time. About 5 lakh tonnes of additional finished steel were produced by utilising 114% of rated capacity of available facilities (without addition of any new major units) and by improving operational efficiency. The captive mines of SAIL met 100% iron ore requirement of the company’s steel plants by producing around 25 MT of iron ore during the year.

Thrust on cost competitiveness continued and the company saved over Rs. 400 crore during the year through various cost control measures and by improving techno-economic parameters. SAIL achieved lowest-ever energy consumption of 7.14 giga calorie per tonne of crude steel, blast furnace productivity of 1.5 tonnes/m3/day, 1,136 kgs of metallic input, etc. Best-ever labour productivity was also recorded at 200 tonnes per man during the year for SAIL as a whole and 268 tonnes for Bhilai Steel Plant.

Substantial growth was recorded in production of value-added items during 2006-07. Growth of 13% was achieved in electrical sheets, 55% in pipes, 15% in TMT bars, 9% in plates, 4% in railway materials, etc. This, coupled with growth in production and techno-economic parameters, will help the company in improving its bottom line. The financial results of SAIL for 2006-07 will be announced in May 2007.

To reach SAIL steel far & wide, the company expanded its marketing network to 527 districts in the country through appointment of dealers, opening 16 new warehouses and 12 customer contact offices during the year for better customer services.

SAIL’s continuing excellent performance received recognition from all quarters and more than 50 awards were conferred on SAIL during the year, including the PM’s Trophy to SAIL’s Bhilai Steel Plant for best integrated operating plant, SCOPE Gold Trophy for Excellence & Outstanding Contribution to Public Sector Management, etc.

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