Tata Steel signs Agreement with WBIDC
January 12, 2005

Tata Steel and the West Bengal Industrial Development Corporate setup a joint venture company called Hooghly Met Coke & Power Co Ltd.

Tata Steel and the West Bengal Industrial Development Corporate (WBIDC) have decided to setup a joint venture company which will be known as the Hooghly Met Coke & Power Co Ltd (HMCPCL). The joint venture company, which will be formed and registered shortly, proposes to set up a merchant coke oven plant at Haldia adopting heat recovery (HR) route with a capacity of 0.8 million tones of coke annually at the completion of phase-one.

A formal shareholders agreement to this effect between WBIDC and Tata Steel was signed by B Muthuraman, managing director, Tata Steel and Gopal Krishna, managing director, WBIDC in Kolkata in the presence of the chief minister of West Bengal Shri Buddhadeb Bhattacharjee, Nirupam Sen, minister-in-charge of commerce and industry and chairman of WBIDC, Ratan Tata, chairman, Tata Sons and Dr T Mukherjee, deputy managing director (steel), Tata Steel.

RatanTata, chairman, Tata Sons commented,"We believe in the leadership of the state of West Bengal, that has spearheaded many reforms and encouraging investments to come in. West Bengal has tremendous potential which is yet to be fully explored?"

Speaking on the occasion, Shri Buddhadev Bhattcharjee, chief minister of West Bengal said, "The Tata Group is very positive about our state. They are coming in a big way and investing in other areas like power, automobile as well as cancer research institute. I thank Ratan N Tata for giving us much importance and taking West Bengal in their fold?"

HMCPC will also generate 60 MW of electricity by utilising the sensible heat of the hot flue gas from the coke ovens. The power generated by this company will be sold to the West Bengal State Electricity Board. A separate tripartite MOA for a Power Purchase Agreement was also executed by Dr T Mukherjee, deputy managing director (steel), Tata Steel, Gopal Krishna, managing director, WBIDC and Malay Dey, chairman, West Bengal State Electricity Board in the presence of the chief minister of West Bengal Shri Buddhadeb Bhattacharjee, Mrinal Banerjee, minister for power, Nirupam Sen, minister-in-charge of commerce and industry and chairman of WBIDC and Ratan Tata, chairman, Tata Sons.

The order for the machinery and equipment is expected to be placed over the year 2005. The first phase of the project is expected to be commissioned within 24 months. The total land requirement for the project would be around 200 acres.

The project is intended for supplying of high quality metallurgical coke to the international as well as to the domestic customers. It will also cater to the requirement of Tata Steel. Considering the necessity of producing world class low ash metallurgical coke, the entire coking coal requirement will be imported from countries such as Australia, Canada, CIS countries, New Zealand, USA, Poland and Indonesia.

The envisaged cost of phase one of the project that is 0.8 mt of coke and 60 mw of power is around Rs.700 cores, which is proposed to be funded through a mix of debt and equity. The equity partners, as indicated are Tata Steel and the West Bengal Industrial Development Corporation.