New Delhi: State-owned steel maker RINL and power equipment manufacturer BHEL will soon sign an agreement to form a joint venture for putting up a high-end seamless tube mill at Vizag, entailing over Rs 2,000 crore investment.
“The proposal has already been discussed in the Board and will be considered in the next meeting. Hopefully, the joint venture agreement will be shortly signed,” Rashtriya Ispat Nigam chairman and managing director A P Choudhary told PTI.
The shareholding pattern of the joint venture is yet to be finalised, he said, but added that since the mill would be located inside RINL’s Vizag facility, RINL would have a majority stake in the venture.
“The mill will have four lakh tonnes per annum seamless tube installed production capacity. Total investment here will be over Rs 2,000 crore,” Choudhary said.
High-end seamless tubes find application in the energy, oil & gas and water sectors among others. The RINL chief said that Bharat Heavy Electricals will meet its need of seamless tubes from the mill.
“After meeting the requirements of the domestic market, we will also export tubes to destinations like the Middle East and others,” he said.
The growing domestic market for seamless tubes has the potential to grow bigger with government’s thrust on creating infrastructure.
Choudhary said that once the joint venture agreement is signed between the partners, the entity would start tendering for the plant and machinery. The tendering process is likely to start before the end of the current fiscal.
“It might take two to two-and-a-half years from the start of the tendering for the plant to be operational,” he said.
RINL’s lone facility at Vizag has three million tonnes per annum (mtpa) installed capacity. It is at an advanced stages of commissioning 3.3 mtpa additional capacity.