Indian government-owned steel producer Rashtriya Ispat Nigam Limited (RINL) will form a joint venture with Andhra Pradesh Mineral Development Corporation (APMDC) to secure an iron ore source for its steel mill located in the southern port town of Vishakhapatnam, government sources said on Monday, May 14.
The proposal for setting up the joint venture has been approved by the boards of directors of both RINL and APMDC, the mining entity of the Andhra Pradesh government, and is currently before the Ministry of Steel for final approval, the sources said.
The JV will ensure iron ore sourcing from the Kukunoor block, under APMDC, the sources said. Although the established iron ore reserves at Kukunoor are "small", extended exploration is expected to yield higher estimated reserves and ensure raw material security for RINL’s 6.3 million mt per year steel mill, the only government steel producer without any captive iron ore source of its own, the sources added.
RINL’s plant requires an estimated 10 million mt of iron ore per year and currently sources the raw material from government miner NMDC Limited’s Bailadila mines in the central Indian state of Chhattisgarh on commercial purchase basis.