NEW DELHI: State-owned steel firms – KIOCL, NMDC and RINL – have decided to set up 13 million tonne per annum (mtpa) slurry pipeline between Nagarnar and Vizag for carrying iron ore with Rs 3,500 crore investment.
They have already inked an MoU for setting up a joint venture in which Kudremukh Iron Ore Company (KIOCL) will hold 48% stake, a source in the Steel Ministry said.
NMDC, country’s largest iron ore miner, and steel-maker Rashtriya Ispat Nigam Ltd will hold 26% each.
The companies may rope in an international technology/ equity partner to join the project at a later stage.
“All the parties agreed to develop the pipeline project in the JV with shareholding of 48:26:26 by KIOCL, RINL and NMDC, respectively.
The slurry pipeline will be used to transport iron ore fines from NMDC’s Bailadila mine in Chhattisgarh to Vizag in Andhra Pradesh, where RINL has its lone steel-making facility.
A 6 mtpa pellet plant will also be set up by the partners in Vizag. Pellets are key raw materials for sponge iron, a key input for steel-making.
NMDC will facilitate land, infrastructure and the required approvals for the project.
The JV will offer finished products to KIOCL, RINL and NMDC as per their shareholding, and the parties can use them for its captive consumption or free trade by the firm.
The transportation of fines through the pipeline will reduce RINL’s dependence on rail.