To develop Bhilwara iron ore mine in Rajasthan, the Unin government-owned Steel Authority of India (SAIL) plans to invest about Rs 800 crore. It also plans to set up a pellet plant with 2 million tonne per annum capacity at the site.

The lease, granted to SAIL by the Rajasthan government last week, is for the mine that is spread over 871 hectare with estimated reserves of around 150 million tonne. According to CS Verma, Chairman of Steel Authority of India, the company plans to produce 5 mtpa iron ore a year from the mine and set up a pellet plant with 2 mtpa capacity with an estimated investment of Rs 700-800 crore.

SAIL will start seeking requisite clearances soon after getting the Letter of Intent (LoI) from Rajasthan government and production from the mine is likely to start in 3-4 years, he said. As SAIL raises its steel-making capacity to 24 mtpa by next year from the present 14 mtpa capacity, the Bhilwara mine would help the national steel maker to partially meet its increased iron ore need.