JSPL to begin production from Odisha coal block by Aug

Estimated to have a reserve of about 225 million tonne

Press Trust of India / New Delhi Apr 16, 2012,
Jindal Steel and Power Ltd (JSPL) today said it will begin production from its Utkal B-1 coal block in Odisha, that is estimated to have a reserve of about 225 million tonne, by August this year.

Besides, the Naveen Jindal-led steel making firm will also begin shipping coal from its mines in Mozambique in next 3-4 months, JSPL's Deputy Managing Director & CEO (Steel Business) V R Sharma told reporters here on the sidelines of the 'Steel Guru' conference.

The coal production from its blocks, both, domestic and overseas, are part of JSPL's ambitious plans of having a total steel making capacity of 15 million tonne per annum by 2015.
The company, which currently has 3 million tonne steel making capacity, is investing about Rs 45,000 crore on its expansion.

"We will begin production from the Utkal B-1 block latest by August. Simultaneously we are also planning to commission a 2 million tonne capacity DRI plant [direct reduced iron]," he said.

The coal block, allocated to the company way back in September, 2003 for its captive use, has missed its production deadline several times in past. Last year, the company was warned by the Coal Ministry over its delayed production.

When asked about it, Sharma said, "There is no issue, the govt is supporting us very much."

He added that coal, produced from the block, will be used for DRI making by the company at its Angul plant in Odisha. DRI, also called as sponge iron, is produced from direct reduction of iron ore (in the form of lumps, pellets or fines) by a reducing gas produced from natural gas or coal.

Coal produced from the Utakl B-1 block will be used in JSPL's upcoming steel plant of 6 million tonne capacity in Angul, Sharma said, adding that initially the company plans to produce about 2.5 million tonne from the block.

The first phase of the plant of 2 million tonne capacity is envisaged to be commissioned by 2013-14.

Talking about the Mozambique coal mine, he said that "within 3-4 months time we will ship it from Mozambique, production has already started there. First shipment will be of 70,000 tonne. Initially we will bring 1 or 2 million tonne for captive use."

The company had obtained mining licence in the African nation in February 2009 and the mine is estimated to hold a reserve of 1.2 billion tonnes of coking and thermal coal.