Reeling under huge debt ESL trying hard to revive
Reeling under huge debt and acute financial crisis, Electrosteel Plant (ESL) at Bokaro is trying hard to come up from this hurdle.
Following the guidelines, given by Pricewaterhouse Coopers (PwC), the ESL management will take stiff steps to give a facelift to the steel plant at Bokaro, said Sunil Katial the Chief Executive Officer.
Presently, ESL has a debt of over Rs 10,000 crore and the State Bank of India started insolvency proceedings against the company; filed a petition at the National Company Law Tribunal (NCLT).
There is a 180-day timeline to decide on a resolution plan, though 90 days can be given in addition. If a plan is not decided, the company will go into liquidation, said an official.
The Calcutta bench of the NCLT has appointed Dhaivant Anjaria, who works as a partner in consultancy firm PricewaterhouseCoopers (PwC), will act in an individual capacity, but the firm will support the initiative.
ESL at Bokaro is a green field project at Siyaljori (in Bokaro) promoted by Calcutta-based Electrosteel Castings Ltd, is 2.51 million tonne steel plant, designed and built by the Chinese steel major Laiwu Steel Group Limited (LSGL). This is the first green field project with the Chinese technology started its production in the end of 2011. However, a downturn in the steel business, among other factors, delayed the execution of the plant, and ESL plunged into losses continuously, said Katial.
Since its beginning, we have faced many hurdles, said Dr CP Pandey, Senior General Manager ESL. “Instead of 2500 only 1000-1200 Chinese experts got their VISA to erect the plant, later their VISA was not renewed which delayed the project”, he added.
Later our coal block was taken back and we have to purchase coal from the market which increases our production costs. In May 2016 an accident (blast) occurred in our Oxygen plant which also gives us a major set back, said Pandey. “Amidst all odds, we are again planning hard to come up from the worse situation as earliest. The chances given by PwC are a golden opportunity for the employees, laborers as well as for the company and we all together need to work hard”, added Pandey.
The ESL unit at Bokaro is based on Blast Furnace (BF)-Basic Oxygen Furnace (BOF)-Billet Caster and Hot Rolling Route and will produce 1.2 MTPA of long steel products, comprising 0.5 MTPA of 5.5-12.0 mm diameter wire rods in coil form and 0.7 MTPA of reinforcement bars in straight lengths and bundled in the range of 8-32 mm and plain rounds up to 60 mm diameter. The plant will have a 0.33 MTPA DI pipe production facility in the same complex and will be provided with hot metal from the blast furnaces. The plant will also have production facilities for 0.27 MTPA of commercial billets and 0.40 MTPA of pig iron.