Pakistan Steel Mills (PSM) has submitted a $2 billion plan for its expansion in third phase, which will enhance its output to over 3 million tons per annum, an official said on Thursday. The plan was presented to advisor to the Prime Minister on Industries, Mian Manzoor Ahmad Wattoo here on Thursday.
The plan will be initiated after the completion of the ongoing first two phases for PSM expansion. The advisor directed the management that PSM must do something to fund the expansion largely from its own resources, the official said. However, the advisor did not indicate that the government will not provide funds for the third phase.
Watoo said that PSM expansion in capacity was required to make the mills more economic and financially viable and to meet the increasing demand of steel in the country. The PSM management has been directed to work out comprehensive expansion plan and to generate its own resources to fund this plan, the advisor told the meeting that was also attended by secretary industries and production Shahab Khawaja and Chairman PSM Moeen Aftab Sheikh.
Wattoo was informed that an expansion plan was underway and by the end of current year the capacity would increase to 1.3 million tons per year (MTPY) from the current 1 MTPY. Under the second phase of the expansion plan, by end of 2010, the capacity will increase to 1.5 MTPY. After the completion of third phase in 2012, the total capacity of PSM will reach to the figure of 3 MTPY.
Wattoo instructed the PSM management to increase its dependence on the local material in its expansion plans and other routine operations. He further said that there were many iron ore and coal reserves in different parts of the country, which should be utilised to save the foreign exchange and decrease dependence on imported raw material.