The Anil Dhirubhai Ambani Group’s (ADAG) proposed foray into cement business is set to start next month with operations commencing on the first of the four 5Mt plants it intends to set up in Madhya Pradesh. The group has secured a prospecting licence (PL) for a limestone mine with reserves of 250Mt to start the cement venture that would be undertaken by a new company, Reliance Cement.
The first phase, which entails an investment of about Rs 10,000 crore for putting up manufacturing capacity in MP, would complement the group’s Sasan ultra mega power project (UMPP) that would generate and supply fly ash for cement manufacturing. In the second phase, cement manufacturing units of identical capacities may be put up in Gujarat and Andhra Pradesh.
The AP project would gain leverage from the group’s second UMPP at Krishnapatnam. “We have received PL for one of the seven limestone mines for which our applications have been filed. The first mine in Satna area has enough reserves to support a 5Mt cement plant. The licence work on the project would be started immediately to bring the unit into operation by 2012,” an official in ADAG said.
Madhya Pradesh has been strategically selected as the location for all four units as the company’s first UMPP would come up at Sasan. As the Sasan project would also be partially operational by 2012 (end of the Eleventh Plan period), it would coincide with operationalisation of the group’s cement venture.
Arvind Pathak from ACC will head the cement venture while another official from Binani Cement has been appointed as project head. With the core team in place, other operational managers would now be appointed.