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               Steel Firms Brace to Align Their Projects with Market Dynamics
(Edited Image Courtesy: naveenjindal.com)
On 25th May, Prime Minister Narendra Modi marked one-year of his government by announcing the onset of  “bure din” (bad days) for those who have “robbed” the country during 60 years of their rule. 
The God knows whether Congress leader-cum-businessman Naveen Jindal figures in Mr. Modi’s list of persons cursed with bure din. Mr. Jindal, an ex-MP, is currently entangled in Coalgate probe. He is certainly not getting a fair deal from the Ministry of Environment, Forests and Climate Change (MOEFCC).
If UPA’s favour to JSPL in allocation of coal blocks is excluded, we then find that MOEFCC’s indifference towards Naveen’s flagship company, Jindal Steel & Power Limited (JSPL), has seamlessly spilled over from UPA to NDA. 
JSPL has thus been waiting for more than two years for grant of a substantial amendment to environmental clearance (EC) for its partially commissioned integrated steel project at Angul in Odisha!
Undeterred by delay, the company has applied for additional amendments to EC. It is proceeding ahead with the implementation of units for which revised clearance is awaited.  The company is perhaps pinning hope on Mr. Modi’s resolve to facilitate growth, jobs and tax revenue, which is required for promoting inclusive growth. 
In a letter dated 11th June 2015 addressed to MOEFCC, JSPL has reminded the Ministry that its earlier request dated 11th March 2013 for amendment to EC is pending clearance. In that request, the company had sought approval to bifurcate its 6 million tonnes per annum (mtpa) steel capacity into two different technology routes – 3mpta electric arc furnace (EAF) and 3mtpa basic oxygen furnace (BOF). 
As put by the company, “We have noticed that though our proposal was uploaded by MOEF on the website about 2 years back, but the same is yet to be considered by MOEF. It is requested to consider the same on TOP PRIORITY (emphasis as in the letter), so that steel melting shop based on BOF is not delayed further.” 
The company had originally planned the entire 6mtpa capacity on EAF Route. It later decided to split the capacity into two technology routes. It justified this radical change in configuration by contending that EAF-based steel production is economically viable when plenty of cheap scrap, the raw material, is available in the market. As more scrap and sponge iron is used in EAF, the electricity consumption is significant.
The company says: “In the present scenario at JSPL Angul, the hot metal availability from blast furnace is more than sufficient to mix some sponge iron and produce steel using the BOF route. Oxygen lancing in BOF will generate gases having high calorific value due to suppressed combustion. Power consumption is about 85% lower in BOF compared to EAF. This ensures production of steel at low cost.”
In this letter, JSPL has sought permission to deploy water-based system for cooling ultra-hot coke produced in coke ovens. This request for this add-on facility has been made in anticipation of glitches in the operation of proposed inert gases-driven dry cooling system. The company intends to commission coke ovens in March 2016 at Angul district of Odisha. 
Coke, which is vital input for production of steel, is manufactured from metallurgical-grade coal in coke ovens. This equipment would form part of JSPL’s partly commissioned 6 million tonnes per annum (mtpa) steel plant that includes a partially operational 1142 MW captive power plant (CPP). 
JSPL has proposed amendment to EC for use of water-based wet quenching system (WQS) till inert gases-based coke dry quenching (CDQ) system is commissioned. 
CDQ is a water-conserving, energy-saving and climate change-friendly technology for which JSPL awarded the requisite contract to Nippon Steel & Sumikin Engineering Co. Ltd of Japan in April this year.
Of the two CDQ systems to be installed, the first one is to be implemented within 12 months from the start of “project time schedule”, according to the contract document. 
Unlike CDQ, wet quenching of coke results in energy loss of 0.36 to 0.42 Gigacalories per tonne of coke. “Coke quality also deteriorates and causes water pollution due to water quenching”, says a MOEF document. 
The letter says: “During the startup of coke oven battery, the coke production is low and irregular. The operation of CDQ system with low and unstable coke production damages the refractory lining of CDQ chamber. Hence, it is not recommended to operate CDQ during the coke oven battery start up.”
It adds: “during the startup/ramp up of coke oven battery operation, the waste heat from coke is less and unstable. Hence it is not adequate enough to run the boiler. After commissioning of CDQ, wet quenching be allowed to be kept as stand-by for emergency operation and also to be used during the annual shut down of CDQ boiler.”  
Under UPA-II rule, the project survived a closure threat in February 2011 when MOEFCC closed its show cause to the project issued in November 2010 following a complaint from a NGO.
Angul project aside, JSPL’s application for grant for EC for its 5mpta steel project in East Singhbhum district of Jharkhand is also pending with the Ministry since 14th March 2014. 
Like JPSL, several other steel companies are beseeching MOEFCC to allow alterations in the configurations of their upcoming projects taking into market and technology dynamics.
The companies that have applied for amendments include Steel Authority of India Limited (SAIL), Jindal Saw Limited, Godawari Power & Ispat, Bhushan Power & Steel, Jindal Stainless Ltd, Jayaswal Neco, Refulgent Alloys N Steels and Mann Steel & Power.  
Jindal Saw has proposed revision in the terms of reference (TOR) for environment impact assessment (EIA) of its proposed greenfield steel plant to be set up in Bhilwara district of Rajasthan.
In a letter dated 7th May 2015 to MOEFCC, Jindal Saw says: “during project detailing and process testing, a major difficulty has been found in sintering process due to use of captive ultra fine iron ore concentrate produced from beneficiation of low Fe grade Magnetite iron ores. This fact has compelled us to reconfigure the project replacing Sinter-PF route of iron making to Pellet-BF Route of iron making.” 
The company has accordingly submitted to the Ministry a revised pre-feasibility report on the integrated steel project along with proposed amendments to TOR. 
Similarly, SAIL has proposed radical alteration in its EC for the much-delayed expansion its Durgapur Steel plant (DSP). 
The company last month requested MOEFCC to drop four units mentioned in the EC dated 10th September 2007, which has already been extended and amended. The units that SAIL does not intend to set up include new wire and rod mill, new sinter plant and additional captive power unit. 
Noting that the implementation of Durgapur phase II expansion has been delayed due to global meltdown in 2008, SAIL says: “the completion of some of the facilities like New Merchant Mill and New Wheel & Axle Plant will spill beyond the extended validity period of the EC i.e. September, 2017 for which a separate application is being submitted for grant of fresh EC / TOR.”
Till new Merchant Mill and new Wheel & Axle Plant are installed, DSP has to sell billets in the market as semi-finished steel.
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