Mumbai: ESSAR Steel Holdings, a part of the Essar Group, plans to invest $1.6 bn (approximately Rs 7,200 crore) over the next five years to build an integrated steel plant, with a capacity of 2.5 mn tonnes, in the Minnesota region. The company recently completed the ground breaking for this project.
Synergies for this planned steel project will be provided by captive supplies of 1.4 bn tonnes of iron ore. These supplies have been procured by Essar Steel Holdings through its acquisition of the US-based Minnesota Steel in 2007.
This steel-making facility will be located in close vicinity of iron ore reserves in Minnesota.
Essar Steel already operates in Canada via Essar Steel Algoma, which it had acquired in 2007 for approximately $1.6 bn. Following this acquisition, Essar Steel Algoma has increased its capacity from 2.4 mn tonnes to 4 mn tonnes.
Senior officials in the Essar Group stressed on the long-term synergies that they will be targetting from their existing operations in Canada and their US-based operations, which include iron ore and the planned steel plant.
This investment in a new steel plant is being made at a time when there are concerns about the health of the US economy.
However, Essar officials pointed out that in higher value steel products that they make for the US engineering and auto sector, they have not seen any reduction in demand conditions.
Meanwhile, in its domestic operations, Essar Steel is currently ramping up its capacity from 4.6 mn tonnes to 10 mn tonnes. - ibef
Synergies for this planned steel project will be provided by captive supplies of 1.4 bn tonnes of iron ore. These supplies have been procured by Essar Steel Holdings through its acquisition of the US-based Minnesota Steel in 2007.
This steel-making facility will be located in close vicinity of iron ore reserves in Minnesota.
Essar Steel already operates in Canada via Essar Steel Algoma, which it had acquired in 2007 for approximately $1.6 bn. Following this acquisition, Essar Steel Algoma has increased its capacity from 2.4 mn tonnes to 4 mn tonnes.
Senior officials in the Essar Group stressed on the long-term synergies that they will be targetting from their existing operations in Canada and their US-based operations, which include iron ore and the planned steel plant.
This investment in a new steel plant is being made at a time when there are concerns about the health of the US economy.
However, Essar officials pointed out that in higher value steel products that they make for the US engineering and auto sector, they have not seen any reduction in demand conditions.
Meanwhile, in its domestic operations, Essar Steel is currently ramping up its capacity from 4.6 mn tonnes to 10 mn tonnes. - ibef
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