China Steel Corp (中鋼) said yesterday its board had approved injecting US$60.06 million into a wholly owned unit in India and spending a total of NT$3.92 billion (US$130.9 million) to improve its emission controls over the next four years.
China Steel Corporation India Pvt Ltd, which is constructing an electrical steel sheet plant in the Bharuch district of India’s Gujarat state, will use the new funds to continue the project, China Steel said in an e-mailed statement.
The India project, which started construction in September 2011 and is scheduled for starting a test run in October, is designed to produce 200,000 tonnes of non-oriented electrical steel sheets per year, China Steel said in August 2011. At that time, the nation’s largest steel producer by revenue said it was planning to spend US$66.58 million on the project.
The non-oriented electrical steel sheets are used as the key material in the manufacturing of high-efficiency motors, which China Steel said would help it meet demand in India and expand its reach to other markets, such as the Middle East, Europe and North Africa.
Company officials had expected the project’s annual output to reach 1 million tonnes in four years, with an annual revenue contribution of about NT$5 billion (US$166.9 million). The company reported revenue of NT$207.19 billion last year.
Separately, China Steel’s board also approved a NT$2.21 billion investment in new flue gas desulfurization and denitrification facilities for steel smelting plants between next month and August 2016.
In addition, the company is to invest NT$1.71 billion in a heating furnace renovation project at one of the company’s hot-rolled production lines from next month through October 2016.
This renovation will improve the firm’s production of high-grade steel products with better emission controls, while helping cut manufacturing costs of NT$252 million a year, according to the statement.
The Greater Kaohsiung-based company will also spend NT$870 million on land and building purchases in the city’s Siaogang District (小港), where China Steel is headquartered, the statement said.
In June, China Steel chairman Tsou Jou-chi (鄒若齊) said at the company’s annual general meeting that the firm would spend NT$22 billion in capital expenditure and NT$38.3 billion in overseas investment this year.
Meanwhile, because the company also plans to diversify its business portfolio into other sectors while coping with the government’s policy of promoting green energy, the board yesterday approved another plan to invest in wind power.
The company plans to hold talks with strategic partners about setting up a joint venture to tap into the wind power industry, as well as seek cooperation opportunities with wind turbine makers and supply chain companies in the preliminary stage, the company said.
However, China Steel did not disclose the identity of the potential investment partners and supply chain manufacturers, nor did it provide a timeframe for the new investment.