Vulcan Steel seeks $2.5B for Oman project talks
Steel

Vulcan Steel seeks $2.5B for Oman project talks

According to two individuals familiar with the matter, it was reported that Vulcan Steel, a company owned by industrialist Naveen Jindal, is currently engaged in discussions with export credit agencies (ECAs) from multiple countries to secure $2.5 billion in funding for their upcoming green steel plant in Oman.

As per the aforementioned sources, it was stated that the funding for the plant's construction will exclusively come from non-bank sources. In an earlier interview, a senior executive from the group mentioned that the company plans to invest over $3 billion into the project, which is based in Duqm.

The ECAs will play a role in financing the procurement of capital goods for the plant, which will predominantly be imported from overseas into Oman. Typically, ECAs provide funding for purchases made by foreign buyers from their respective home countries, thus supporting export activities.

The plant, anticipated to be operational by 2027, is expected to have a manufacturing capacity of 5 million tonnes per year. It will be a part of Jindal Shadeed Iron and Steel LLC, a company that Vulcan Steel acquired in 2020.

The project has been undertaken with a focus on the European steel markets, as the continent has a preference for lower emission raw materials in order to achieve its decarbonisation objectives. Vulcan Steel sees potential in the demand for green steel, as it is considered a leading solution for manufacturing companies to reduce their carbon footprint.

Green steel possesses the same properties as conventional steel but is produced without the use of fossil fuels, resulting in a minimal carbon footprint. Currently, it is not available on an industrial scale.

Companies worldwide, particularly in developed nations, are racing to develop the necessary technology and produce green steel on a large scale. H2 Green Steel, a Swedish firm, is set to become the first major green steel manufacturer once their plant, currently under construction, becomes operational by 2025.

Vulcan Steel acquired Jindal Shadeed Iron and Steel LLC from JSPL for an enterprise value of $1 billion. In 2020, JSPL made the decision to divest from the asset as part of its strategy to reduce debt and focus on its core steel business in India. JSPL held a 99.9% stake in the Oman asset, which it purchased for $464 million in 2010.

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According to two individuals familiar with the matter, it was reported that Vulcan Steel, a company owned by industrialist Naveen Jindal, is currently engaged in discussions with export credit agencies (ECAs) from multiple countries to secure $2.5 billion in funding for their upcoming green steel plant in Oman. As per the aforementioned sources, it was stated that the funding for the plant's construction will exclusively come from non-bank sources. In an earlier interview, a senior executive from the group mentioned that the company plans to invest over $3 billion into the project, which is based in Duqm. The ECAs will play a role in financing the procurement of capital goods for the plant, which will predominantly be imported from overseas into Oman. Typically, ECAs provide funding for purchases made by foreign buyers from their respective home countries, thus supporting export activities. The plant, anticipated to be operational by 2027, is expected to have a manufacturing capacity of 5 million tonnes per year. It will be a part of Jindal Shadeed Iron and Steel LLC, a company that Vulcan Steel acquired in 2020. The project has been undertaken with a focus on the European steel markets, as the continent has a preference for lower emission raw materials in order to achieve its decarbonisation objectives. Vulcan Steel sees potential in the demand for green steel, as it is considered a leading solution for manufacturing companies to reduce their carbon footprint. Green steel possesses the same properties as conventional steel but is produced without the use of fossil fuels, resulting in a minimal carbon footprint. Currently, it is not available on an industrial scale. Companies worldwide, particularly in developed nations, are racing to develop the necessary technology and produce green steel on a large scale. H2 Green Steel, a Swedish firm, is set to become the first major green steel manufacturer once their plant, currently under construction, becomes operational by 2025. Vulcan Steel acquired Jindal Shadeed Iron and Steel LLC from JSPL for an enterprise value of $1 billion. In 2020, JSPL made the decision to divest from the asset as part of its strategy to reduce debt and focus on its core steel business in India. JSPL held a 99.9% stake in the Oman asset, which it purchased for $464 million in 2010. Also read: Shree Cement plans Rs 60 billion investment for capacity Crisil: Cement prices may decrease 1-3% despite strong

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