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Odisha Government’s State Level Task Force (STF) for steel has recommended a two-year extension of Memorandum of Understanding (MoU) signed for 11 steel projects and six independent power producers (IPPs) in the state.
The steel units whose MoUs obtained life-extensions were Tata Steel, Action Ispat and Power, BRG Steel Co, Jai Balaji Jyoti Steel, MGM Steels, MSP Metalics, OCL Iron and Steel, Rungta Mines, Shyam DRI Power, SMC Power Generation and Surendra Mining.
Tata Steel’s Kalinganagar integrated steel plant is the largest project amongst the 11 steel projects, and phase-I of this six million tpa project is likely to be commissioned by August 2014.
The Odisha government started verifying the progress made by projects for which the state had entered into MoUs in the past couple of years. During the mid 2000 the state received a number of project proposals in the steel sectors and the state signed around 50 MoUs. Most of the projects did not see the light of day. Non-availability of project land, iron ore and stiff opposition from those ousted from their land, saw a number of project promoters backing out of their projects.
According to Industrial Promotion & Investment Corporation of Odisha Ltd. (IPICOL), while Maharashtra Seamless scrapped its project due to unsatisfactory progress, only 30 of the balance 49 project owners furnished detailed status report and sought an extension of MoUs.
Three inter-departmental teams were formed by IPICOL to oversee the progress made by steel and power projects at ground level.
The teams carried out their verification from 11 March, 2013 to April 15, 2013. The teams verified the progress made by the 30 steel companies and seven independent power producers (IPPs) whose renewal of MoUs with the state government was pending for disposal. The teams submitted their reports to IPICOL which then submitted the reports to the Odisha Government’s STF for Steel.
Out of the 30 steel companies, 15 were discussed in the first phase of the STF discussions. The remaining 15 companies, including Posco-India's MoU which lapsed two years ago will be discussed in the second phase.
Six Power MoUs deadlines extended
The STF on Power, headed by the energy secretary, P K Jena, recommended the extension of timeline of six MoUs signed between the Odisha government and GMR Kamalanga Energy, Jindal India Thermal Power Limited, Monnet Power Company, Ind Bharat Energy, Lanco Babandh Power and Maa Durga Termal Power Company. These six IPPs are expected to create power generation capacity of 3,540 MW by March 2014.
The STF on Power took up the cases of seven power projects and decided to put on hold the case of KVK Nilanchal’s MoU due to the ongoing litigation in the state High Court.
In the past couple of years, the Odisha government has signed MoUs with 29 IPPs with the intention of expanding the state’s generation capacity by around 37,000 MW.
Of the six IPPs which got reprieve, GMR Energy started commercial operation at its Unit-I of 350 MW in May 2013. The thermal power plant coming up at Kamalanga in Dhenkanal district has a total capacity of 1,400 MW (4x350).
While Monnet Power Company hopes to commission 525 MW in phase-I of its 1050 MW coal-based power plant by September this year, Lanco Babandh Power is likely to start production in 2014 and Maa Durga has set August 2013 as its deadline to commence power generation at its 120 MW capacity thermal power plant.
Jindal India Thermal and Ind-Bharat’s projects are also under execution.
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