Mumbai: Mitsubishi Corp. (MC) and Larsen and Toubro Ltd (L&T) have won a ¥50 billion contract from state-run Steel Authority of India Ltd (SAIL) to construct a steel plant, Mitsubishi said in its statement on Wednesday.

Under the project, a hot strip mill with production capacity of 3 million tonne per annum will be constructed at SAIL’s Rourkela steel plant in Orissa.

The project will start production in 2018.

“The consortium of MC and L&T will serve as contractor of the project, with MC undertaking project management, while L&T will undertake civil construction, erection, and local supply," Mitsubishi said in its press statement.

This project would be the first full turnkey steel project for Mitsubishi in India.

India produced approximately 90 million tonnes of crude steel in 2014, and the ministry of steel plans to expand that to 300 million tonnes by 2025.

However, there are no fresh greenfield project announcements that private steel producers have made since 2012. State-run companies like SAIL are expected to play a bigger role in this planned 300 million tonne capacity addition.

Close