Indian Steel major, SAIL, is eyeing acquiring Coking coal assets in foreign countries in order to reduce import dependence.
As Coking coal production in India is low, steel makers in the country have to depend upon imports to meet their production requirements.
SAIL’s coking coal requirement will go up in the near future as its capacity expansion projects are in advanced stages of completion. Subsequent to completion of its capacity expansion projects, SAIL’s steel production will increase to 20.23 MnT, and to sustain the production, around 21 MnT of Coking coal will be required. Out of the total coal requirement, 95% will have to be procured through imports.
During FY16, the steel major had consumed 15.6 MnT of Coking coal in producing 12.4 MnT of steel. SAIL had to import 86% of the coal requirement during the fiscal, and the remaining 16% was met through domestic sources. SAIL also has been allotted with 0.5 MnT of captive coking coal assets in the country.
Although, SAIL had purchased a coking coal asset in Mozambique in 2011 from Rio Tinto along with NMDC and RINL, it has not been of any use as the only operating mine, Benga, has been lying idle since Jan’16.
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