Essar Steel to pump $1 bn in Canada ops

Kolkata: Essar Steel is making an additional investment of $1 billion to run its Algoma steel plant in Canada at full capacity, at 4 million tonne per annum. It bought the Canadian facility for $ 1.6 billion in 2007.



In another development, the company has decided to be bullish over expansion of its retail arm in India by setting up 125 hypermarkets and 650 express markets by the end of the fiscal. Essar Steel chief executive officer Malay Mukherjee, on the sidelines of a press conference, said when Essar acquired Algoma in 2007, the plant with two blast furnaces, of which only one was operational, was efficient in producing only 1.2 million tonne per annum. After further refurbishment of the operational blast furnace, the production was taken up to above 2 million tonne. " The unused blast furnace is ready for operation now and we can go to 4 mt of production," Mukherjee said. This production, according to Mukherjee, would be done with an eye on the demand situation in the US and Canada.



"Our additional investment on this plant will be $ 1 billion to make this plant capable of running at its rated capacity" Mukherjee said. In India, Essar is currently bullish over expansion of its retail arm aiming to set up 125 hypermarts and 650 expressmarts by the end of 2010-2011, Girish Rao, CEO Essar Hypermarts, said. He said after recently opening the Hypermart in Ranchi, Essar Steel currently has 100 hypermarts and 419 expressmarts across the country.



While, hypermarts are owned by Essar, expressmarts have been franchised. In fact, the Essar Steel initiative of creating hypermarts and expressmarts has been aimed at making steel available to the end users' closest point. This, according to Mukherjee, would help India's per capita steel consumption grow, mostly in rural areas because though the rural market has a formidable demand for steel.

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