The Hindu Business Line : Electrosteel puts off opening of Haldia coke oven unit

THE scheduled commissioning of the Rs 100-crore new coke oven plant of Electrosteel Castings Ltd (ECL) at Haldia with an installed capacity of 1.5 lakh tonnes per annum (tpa), has now been pushed back by six months to January 2005.

Originally scheduled for completion by August 2004, the project has been delayed owing to a combination of factors such as heavy rains resulting in flooding at plant site, shortage of skilled labour and slowdown in delivery of key raw materials.

The coke to be produced from the Haldia plant was expected to replace the requirement of imported coke at ECL's mother plant at Khardah in West Bengal.

The imported coke requirements of the company are now put at 13,500 tonnes per month, and the international prices (averaging $450 per tonne now) have registered a phenomenal increase in the last one and half years, it is pointed out.

When contacted, Mr Umang Kejriwal, Managing Director, confirmed the development to Business Line, stating that mainly the monsoons and the low availability of raw materials such as refractory bricks, mainly procured from Dhanbad and Rajgangpur (Orissa), have contributed to the commissioning delay.

Asked on the position of coal imports, he said as a consequence, the company was now in the process of rescheduling the quantities and deliveries of imported coal, being imported from Russia, Australia, China and a few other countries.

Mr Agarwal said the prices of iron ore and coke, the principal raw materials for manufacture of ductile iron (DI) pipes, increased by 32 per cent and 54 per cent respectively during 2003-04, and the overall price fluctuations for these materials in the global markets have created problems for the company.

He clarified that in order to mitigate this threat of disruption in raw material supplies, ECL was setting up the coke over plant, alongwith a one-lakh tonne sponge iron facility at Haldia.

Imported coal will be converted to coke for feeding the mini blast furnace at Khardah.

He said ECL also planned to augment its electricity requirements through the Haldia coke over unit, where the waste gases generated from the coke manufacturing process would be utilised to generate power. This, he said, was expected to enhance ECL's power generation capacity to 80 per cent of its requirement.

The surplus power would be wheeled to Khardah to effectively bring down the current power costs.

The coke oven plant would have two batteries of 34 ovens each. Mr Agarwal said the ordering of all equipment for the plant has been completed. He pointed out that effective raw material management was central to the company's profitability.

"While a pile-up is undesirable, a steady supply of inputs governs production schedules, end product profitability and capacity utilisation."

Among the few manufacturers DI pipes and ductile iron fittings in the world, ECL has suspended production of CI pipes in the third quarter of 2003-04 in view of the declining demand for cast iron pipes. The company enjoyed a market capitalisation of Rs 476.62 crore towards the close of 2003-04.

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