SAIL initiated expansion project to level up production of 4 Units

New Delhi: SAIL's management has initiated the expansion project to level up the production capacity of four units, excluding the flagship unit BSP. A detailed project report (DPR) worth one lakh crore is currently under preparation and is expected to be completed by September. Following this, the tender conditions will be formulated. SAIL aims to commence the project in the fiscal year 2027-28 and complete it by 2031-32.

This announcement was made by Anil Tulsiani, the Director of Finance at SAIL, during an investor conference held on May 26th. Tulsiani highlighted that the country's target is to increase steel production capacity to 300 MT, to align with this objective, SAIL has decided to enhance the production capacity of its Bokaro, IISCO Burnpur, Rourkela, and Durgapur plants, increasing the overall capacity from 21 MT to 30 MT. However, the flagship unit BSP is not included in the initial phase of the project, and the DPR will be finalized in September.

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BSP Expansion Delayed Due to Space Constraints

Initially, the expansion project planned to incorporate BSP as well, but it encountered difficulties due to the lack of available space within the plant premises to accommodate the new units. The modernization and expansion project at BSP intended to decommission several closed units such as Furnaces 2 & 3 and SMS 1. However, due to unforeseen circumstances, these activities could not be completed within the scheduled timeframe. Although BSP has a considerable amount of land outside the plant premises, setting up a new unit there is not feasible due to the distance involved.

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Recovering from Losses Due to Expensive Foreign Coal

During the investors' conference, Director of Finance Anil Tulsiani revealed that SAIL experienced losses in the first quarter primarily due to the high cost of foreign coal. At that time, SAIL had to procure foreign coal at a rate of USD 600 per tonne, leading to increased production costs. However, coal prices began to decline in the second quarter, positively impacting steel production costs and ultimately restoring profitability for SAIL. This development is crucial as the company's profit directly affects the well-being of its employees.

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