State-run steel maker SAIL has signed an initial pact withOman Oil Co to jointly set up a 3 million tonne per annum (mtpa) gas-basedsteel plant in Oman at an investment of around Rs 15,000 crore. The final agreement with Oman Oil is likely to be signedwithin the next six months, after which, it will take 2.5-3 years for the plantto be operational. The shareholding pattern of the proposed venture isyet to be decided however the majority of the stake would be with SAIL. Omanconsumes around 3-4 mtpa of steel in a year. However, steel making capacity inthe West Asian country is under 1 mtpa. The plant would use gas-basedDRI (Direct Reduced Iron) technology for making both flat and long products,the two broad categories of steel products. While flat products are used inconstruction, Long ones are used in auto, white goods and consumer durables.
SAIL has signed a MoU with the Indonesian government and wasin constant dialogue with the governments in Mongolia, South Africa and Omanfor setting up a 3 mtpa steel plant in each of the four countries, involving aninvestment of $12 billion. SAIL has already embarked on a Rs 70,000-croreexpansion plan to enhance its domestic production capacity from 14.35 mtpa to23.46 mtpa by 2012-13.
