The government of Odisha has begun talks with ArcelorMittal, asking the company to set up a three million tpa steel plant in the state. The project worth Rs 12,000 crore was originally meant to be set up by Essar Steel.
Now, with ArcelorMittal taking over Essar Steel under the Insolvency and Bankruptcy Code (IBC), the Odisha government wants the new promoter to revive the project. This steel plant was envisaged to be set up by Essar Steel under a memorandum of understanding (MoU) signed with the Odisha government in 2005.
In December 2019, ArcelorMittal had announced that it had completed acquisition of Essar Steel and simultaneously established a joint venture with Nippon Steel Corporation, called ArcelorMittal Nippon Steel India (AM/NS India) which will own and operate the acquired company.
ArcelorMittal currently holds 60 percent of AM/NS India, with Nippon Steel holding the balance. Essar Steel had earlier set up a six million tpa pellet complex in Paradip. The pellet plant is backed by a 12 million tpa beneficiation plant at Dabuna (Keonjhar)-- the two facilities are connected by a slurry pipeline.
The Odisha Industrial Infrastructure Development Corporation had acquired 1,262 acre of land in Paradip, of which 1,123 acre were for private companies and around 100 acre for government-owned ones.
The state government gave Essar Steel 676.61 acre of land to build a three million tpa greenfield steel mill for Rs 116.27 crore. Instead of a steel plant, Essar Steel developed the pellet plant, utilising 200 acre of the allotted land.