The Chunar cement factory, which was closed in 1998 due to huge losses, has been recommissioned after a Rs 1,100 crore makeover by Jaiprakash Associates.
Manoj Gaur, executive chairman of JP Associates, inaugurated the modernised factory here, about 50 km from Varanasi.
JP Associates had acquired the erstwhile state-run facility in 2005 after the Allahabad High Court invited bids for sale of the plant and other assets of the UP State Cement Corporation Ltd through a global tender.
The company placed a winning bid of Rs 459 crores and had bagged the tender in January 2006. It had also acquired the Dalla cement facility.
Initially, the plant will produce 1.5Mta of cement and with more investment and completion of the third phase the production will be scaled up to 3Mta by 2010.
Gaur said his company would be spending over Rs 1,000 crores, in addition to the bid amount, on this exercise and on the completion of the same, the total cement production capacity of the units at Dalla and Chunar would be two mtpa by September this year.
He said that JP Associates will also set up coal-based captive power plants at Dalla and Chunar of 27MW and 38MW respectively to make these cement plants most cost effective.