SAIL Forms JV Agreement to Develop Iron Ore Mines with Kudremukh Iron Ore

Steel Authority of India Ltd (SAIL) today signed an MoU with Kudremukh Iron Ore Co. Ltd (KIOCL) for forming a 50:50 joint venture company to develop iron ore mines at Barsua, Taldih and Kalta in Orissa. The joint venture company will synergise the experience and expertise of the two PSUs and add value to the country’s mining operations. SAIL is the country’s largest producer of iron ore with an annual production of around 20 million tonnes, while KIOCL operates and maintains the single largest iron ore mine in India besides having expertise in production of iron oxide pellets.

The joint venture is expected to be a trendsetter in the area of iron ore mining in India. The MoU envisages incorporation of modern mining facilities to produce superior quality iron ore for meeting the requirements of some of the SAIL plants and further value addition through installation of a pellet plant. MECON has been engaged to prepare the feasibility report for the project while NMDC will undertake ore characterisation study.

The SAIL-KIOCL joint venture will go a long way in meeting the increased iron ore requirements of the SAIL plants, which are gearing up to increase their hot metal production levels to an aggregate of around 20 million tonnes by 2011-12 from the current level of 13 million tonnes. The joint venture would also contribute to the economic development of the region in which the mines are located.

In another development, the SAIL Board of Directors at a meeting today agreed in principle for merger of the company’s wholly owned subsidiary, Indian Iron & Steel Co. Ltd (IISCO), with SAIL. Steps for obtaining clearance and necessary approvals from the Government and appropriate authorities will be initiated shortly.

Earlier in the day, while sharing the merger plan with the company’s shareholders at their 32nd Annual General Meeting held at Talkatora Stadium, Mr V.S. Jain, Chairman, SAIL, said: "In today’s environment the priority is to attain growth with synergy. SAIL requires resources for growth and IISCO provides the opportunity in terms of infrastructure, resources and excellent work culture."

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