- Hazira now the world’s fourth largest single location flat steel complex
- Capital investment made on a per tonne basis lower than global benchmarks
- Raw material security and flexibility ensured through addition of new units
- Hazira complex offers the full range of flat steel products catering to all customer segments
- Complemented by well-entrenched distribution network with last mile reach, as well as world-class sustainability practices
- Expansion further bolsters Essar Steel’s track record of being a low cost producer
- Steel complex a testament to India’s infrastructure growth story
The Essar Steel Hazira complex today announced doubling of its capacity to 10 MMTPA (million metric tonnes per annum). This expansion makes the Hazira Steel Complex the largest single location flat steel producer in India and the fourth largest single location flat steel producer globally. With this expansion the complex will be able to offer the entire range of flat products from thin strips and thick plates to pipes, cold rolled and coated products.
On this occasion, the Chairman of Essar Group, Mr Shashi Ruia, said ”We would like to dedicate this plant to the nation. When I first ventured into Hazira, it was my desire to put India on the global steel map and today that dream has come true. Our world-class steel complex is a testament to the hard work put in by the Essar family and our small contribution to the steel industry and India’s growth story.”
This steel plant will play a major role in making Gujarat a global industrial hub catering to the needs of capital and consumable goods, shipbuilding and automobile sector. Being a port-based plant, its strategic location makes it a ideal gateway for meeting the global demand for steel. Domestically the complex will provide world-class steel to meet the diverse needs of various industries, while also making the Hazira Steel Complex a national hub for Essar Steel to provide a range of steel products to the rest of the country. This is in line with the Vision 2020 that envisages taking India’s steel capacity to 200 MMTPA.
Raw Material Security and Flexibility
Essar has adopted an integration and securitisation strategy that has enabled it to keep its costs low even with the expanded capacity. A bulk of its iron ore needs have been secured through offtake agreements with key players like NMDC and captive mines in Jharkhand and Chhatisgarh. In addition, the iron ore beneficiation plants have been set up by the company to facilitate usage of low grade iron ore fines abundantly available in the country. For its energy requirements, Essar has long-term power purchase agreements and will soon have access to source cheaper coal based power from its captive plants. The offtake agreements combined with the captive mines and easy availability of low grade iron ore dumps provides Essar the necessary raw material security to operate its steel plant in the most cost-effective manner.
Essar has three iron making technologies – HBI/DRI, Corex and Blast Furnace. These technologies give them flexibility in their raw material inputs, be it iron ore or energy, in the following ways:
- The complex uses varying grades of iron ore inputs, including lump ore, fines, slimes, sinter and pellets
- The complex uses different energy sources, including natural gas, coking coal, coke, corex gas, blast furnace gas and non-coking coal
- Raw material costs are optimized to deliver the best value to the customer
Low capital investments
Essar Steel has invested over Rs 37,500 crore in the business including the recent project expansion. The industry standard for steelmaking is US$ 1 billion for a million tonnes of production. Essar Steel incurred a cost of just US$ 750 per tonne of steel, which in addition to steelmaking also includes beneficiation, pelletization and downstream capabilities. On a like-to-like basis, Essar Steel has managed to create this asset at a significantly low capital cost. In some cases, the costs are lower than other steelmakers by as much as 50%.
Low cost of production
- Essar Steel will be in the bottom 25% of the global cost curve
- Essar has the ability to use low grade iron ore fines through its own 20 million tonne pellet and beneficiation plants which provide raw material security
- Power requirements have been tied up through captive coal- and gas-based power plants
- Different iron making technologies provide flexibility in raw material usage
Complete portfolio of flat steel products
- New compact strip production (CSP) mill is capable of producing thin gauge strips of thicknesses as low as 0.8 mm
- CSP along with the hot strip mill (HSM), plate mill, pipe mill and other existing downstream facilities offer the ability to produce the entire range of value-added flat steel products
- Over 70% of the basket of products are value added, thus positively impacting margins
- Caters to all customer segments
World-class sustainability standards
In early 2011, Essar Steel signed the World Steel Association (WSA) Sustainable Development charter which evaluates economic, social and environmental sustainability of an organization. On most parameters we were either on par or better than the WSA peer group. As an organisation we are conscious of the impact of our products and services on the environment. In 2010, we conducted the Life Cycle Impact Assessment of Hot Rolled Coil (HRC) as per ISO 14040:2006 and ISO 14044:2006.
Key sutainability accomplishments in FY 2010-11 include:
- 8.72% reduction in Greenhouse gas emissions in India
- 99% reuse of by-products in Hazira
- Lifecycle Impact Assessment completed for HRC
- Over 130,000 cu. mtr of water conserved through rainwater harvesting in Hazira
- 91% of solid waste utilised in Hazira
- 5.2% reduction in specific water consumption of crude steel at Hazira
Regardless of these achievements, we continue to strive to being the most sustainable steel company in the world.
A responsible corporate citizen
Essar Steel, through the Essar Foundation, has been designing their CSR programmes to address various social challenges and add value to the society. The programmes are classifed under different heads that broadly encompass the guiding philosophy of the UN Millennium Development Goals (MDG). The key focus areas are Livelihood Creation, Welfare of Women, Education, Infrastructure, Environment and Health.
- Over 1 million people across India are impacted by Essar Steel initiatives through Essar Foundation
- Routine health camps organized to provide both preventive and curative healthcare near Essar Steel operational locations - 250,000 lives touched till date.
- Primary schools supported through Government of India teacher support programmes—more than 5,000 students reached in the states of Gujarat and Orissa
- More than 150 women trained in tailoring and embroidery in Hazira to earn a sustainable livelihood
- Computer training centres opened to teach local kids in Hazira. More than 250 children have signed up until date
- Water and roads infrastructure provided in Orissa and Chattisgarh
Commenting on completion of the expansion, Mr Dilip Oommen, CEO, Essar Steel said: “It is a moment of great pride for us to complete the expansion. Besides bringing down our costs, this will offer operational flexibility in terms of usage of raw materials and product mix. While expanding, we have ensured that the safety and environmental aspects are given due importance in the design, construction and operations of the plant.”
About Essar Steel
Essar Steel, a 14 MTPA global producer of steel, is a fully integrated flat carbon steel manufacturer—with presence in Canada, USA, India and Indonesia. It is the most versatile flat steel producer with integrated facilities. It maks pipes and extra wide plates, as well as hot rolled, cold rolled, galvanized and colour coated steel. It has an integrated distribution business with Service Centres and Steel Hypermarts. It operates seven Service Centre’s in India and Indonesia with an aggregate capacity of over 4 million tonnes. Essar has the largest retail distribution network. Its products find wide acceptance in highly discerning consumer sectors, such as automotive, white goods, construction, engineering and shipbuilding.
About Essar Group
The Essar Group is a multinational conglomerate and a leading player in the sectors of Steel, Energy, Infrastructure and Services. With operations in more than 25 countries across five continents, the Group employs 75,000 people, and has revenues of US$ 17 billion.
For additional information, visit www.essar.com.
Manish Kedia, Sr. VP – Corporate Affairs, Essar Group,
Phone: +91 98197 30092, Email: email@example.com
B.Ganesh Pai, VP - Corporate Communications, Essar,
Phone: +91 98197 30225, Email: firstname.lastname@example.org
Detailed listing of all units that comprise Essar Steel India
- Beneficiation Facilities
- 8 MMTPA Iron ore beneficiation plant at Kirandul, Chhattisgarh.
- 12 MMTPA Beneficiation facility at Dabuna, Orissa* [8 MT in March ‘12, 4 MT in March ‘13]
- Slurry Pipelines
- 267 KM pipeline from Kirandul to Vizag
- 253 KM pipeline from Dabuna to Paradeep* [by March ‘12]
- Pellet Making Facilities
- 8 MMTPA Pelletization plant at Visakhapatnam, Andhra Pradesh.
- 12 MMTPA Pelletization plant at Paradeep, Orissa* [6 MT in March ‘12, 6 MT in March ‘13]
- Iron Making
- 6.8 MMTPA DRI modules (6 modules)
- 1.7 MMTPA Blast Furnace
- 1.7 MMTPA Corex modules (2 modules)
- Steel Making
- 4.6 MMTPA Electric Arc Furnaces (4 units)
- 2.5 MMTPA CONARC Furnace (unit 1)
- 2.5 MMTPA CONARC Furnace (unit 2)
- Hot Rolled Coil
- 4.0 MMTPA Hot Strip Mill
- 3.5 MMTPA Compact Strip Mill
- Cold Rolling Facility
- 1.4 MMTPA Cold Rolling – Hazira
- 0.6 MMTPA Cold Rolling - Pune
- Galvanizing Facility
- 0.5 MMTPA Hazira
- 0.5 MMTPA Pune
- Colour Coating Facility
- 0.4 MMTPA Pune
- Plate Mill – 1.5 MMTPA
- Pipe Mill – 0.6 MMTPA
- Distribution Network
- Processing and Distribution Centers with a 4 MMTPA capacity across the globe
- Multiple Distribution outlets under the brand name Essar Hypermart.
*To be commissioned