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Revival Plan of Tuwairqi Steel Mills Opposed

Steel News - Published on Tue, 18 Feb 2020

Image Source: Pakistan Today
Pakistan Today reported that despite a strong lobby supporting the proposed revival plan of Tuwairqi Steel Mills Limited through an expected investment of around USD 700 million, the framework for the plan has recently been opposed by the federal cabinet. The framework, prepared by the Ministry of Industries and Production to promote direct reduced iron and revival of TSML, was earlier submitted to the Economic Coordination Committee, which later constituted a subcommittee for further evaluation. However, insiders claimed that the same was turned down in the cabinet’s meeting held in the last week of January after some officials of the concerned ministries had shown their reservations over the facilities being offered to the steel company in return of investment.

TSML, in return of fresh investment in DRI, was seeking relaxation in duty on billets and subsidy on gas after three years of operation of the mills. According to documents, the government was going to introduce the incentives for new investors in the DRI sector which would ultimately benefit TSML, which had setup a DRI plant in Karachi.

The Saudi firm had stopped work on the plant, set up at Bin Qasim, Karachi, over an area of 220 acres with 1.28 million tonnes per annum production capacity, after the Pakistan Muslim League-Nawaz government had refused to provide gas at a discounted rate. The mill’s DRI plant was eventually shut down for several months in 2014 due to the gas supply dispute.The TSML management had requested gas supply at PKR 123 per million British thermal units (mmbtu) in order to effectively operate the plant. However, the previous government refused, saying that this would amount to a subsidy of PKR 25 billion over five years.

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Posted By : Nishith Sharma on Tue, 18 Feb 2020
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