ArcelorMittal Nippon Steel acquired gas-based Hazira power plant
The ArcelorMittal Nippon Steel purchased power plant under the SARFAESI Act
On 3rd March 2020, ArcelorMittal Nippon Steel India (AM/NS India) announced that it had acquired the Bhander power plant from Edelweiss Asset Reconstruction Company at Hazira in Gujarat.
The Bhander power plant is a natural gas-based thermal plant with an installed capacity of 500MW and will be captive to ArcelorMittal Nippon Steel India manufacturing operations at Hazira. The Bhander power plant, which was commissioned in 2006 and commenced commercial services in 2008, was purchased by ArcelorMittal Nippon Steel India following the Securitization and Reconstruction of Financial Assets and Enforcement of Securities Interest (SARFAESI) Act.
ArcelorMittal is one the biggest steelmaker in the world, had completed the acquisition of Essar Steel India Limited (ESIL) in December 2019, which at USD 6000 million is also the largest stressed-asset agreement to be achieved in the country. It also declared the establishment of a joint undertaking with Nippon Steel Corporation, called ArcelorMittal Nippon Steel India Limited, which will own and operate Essar Steel.
ArcelorMittal added that it would seek essential clearances, as well as mine development and production deals, ahead of commencing mining operations and developments.
The declaration of the acquisition of Bhander Power Plant comes days after ArcelorMittal India Private Limited said it was chosen as a preferred bidder for an iron ore mine license in Odisha following an auction process facilitated by the state administration.
In Odisha's Keonjhar district, the Thakurani block has estimated reserves of 179.26 million tons of ore. It is anticipated to make a valuable contribution to ArcelorMittal Nippon Steel India's long-term raw material requirements. After the conclusion of the license award process, AMIPL will continue to seek requisite clearances, as well as mine development and production contracts, ahead of beginning mining operations.
According to Dilip Oommen, CEO of ArcelorMittal Nippon Steel India, Company is pleased to have acquired these valuable assets for the steelmaking facilities. This is in line with a plan to secure a robust captive power and materials supply chain as we continue to make substantial strides in our production and operational performance. He added that efforts to become increasingly self-reliant, in this case, through the procurement of a critical energy source in Gujarat and an iron ore-rich reserve in Odisha, form a part of ArcelorMittal Nippon Steel India medium to long term strategy to grow our production capacity in India significantly.