Indian steel giant Steel Authority of India (SAIL) and South Africa's Afripalm Resources have signed a memorandum of understanding to construct a steel plant in South Africa with an investment of $2.94 billion, Indian media reports have said.
Citing Afripalm chairman Lazarus Zim, Indian daily newspaper Business Day said that the companies would conduct a bankable feasibility study for a plant, expected to produce between 3-5 million mt of steel a year. "A six-month bankable feasibility study will be undertaken on the project," Zim was quoted as saying.
SAIL chairman C S Verma earlier this week was quoted by Indian daily Economic Times as saying that it intended to set up four 3 million mt per annum capacity steel manufacturing facilities - one each in Indonesia, Mongolia, South Africa and Oman - at a cumulative investment of $12 billion. The proposed plants would cater to local needs, he said, adding that the company would aim to finalise all the plants in 2011-12.
The South African steel market is controlled by ArcelorMittal South Africa, a unit of the world's largest steel producer.