Steel industry concerned over ‘proposed facilities’ for TSML revival

[CrazyZ]

no issue with business
but is with gov giving public $ to it in form of subsidy
we already have many white elephants


electricity based steel production hasn't proven to be feasible anywhere even Japan has to import LNG for it's steel Mills instead of using local electricity it has self-sufficient in

They are gonna register the site as a SEZ......so they will get tax breaks as all SEZ's will. The success of the SEZ's is important for our economic development. East Asian nations have developed so rapidly because their governments subsidized private mostly exporting businesses. Pakistan needs to replicate this.

Electricity can be used melt steel scrap and iron in arc furnaces......however it can not be used to refine iron from ore.

 

[khanmubashir]

That depends on the whole picture. If the mill earn enough that those subcidise are nothing then OK.
If not then no. Look every glass is half empty and half full. We don't have to discard everything at once. We should see it throughly.

the mill will be earning for it's Arab owners not gop

why should gop pay from public Pocket unless gop owns majority share

 

[Pakistansdefender]

the mill will be earning for it's Arab owners not gop

why should gop pay from public Pocket unless gop owns majority share

It would be paying tax isn't it. Employing paksitanis, 8nvreasing steel production making steel cheap. You attitude means that no one should invest in others countries as they would be earning money for their own countries. Then tesla is making a factory with China, why is China allowing it as they would earn money for their home country.
Investment is also good.
Unless they play monopoly or ask unfair incentives.
We don't know about this case. If giving subcidie would earn government large sum then well and good. If not then no way.
So you have to see it from the pakistan's angle what is good for Pakistan should be done. We should not discard it on whims.

 

[Zulfiqar]

OK this is just plain BS by TSML.

As someone who on behalf of banks has worked on financing deals with several smaller steel mills in northern region and has worked with them for years, this is just pure rent seeking by TSML.

All the steel mills that I know pay utilities as per regular industrial rate and they compete within the market. Why should this company be allowed a benefit when the existing players are disincentivized from setting up new mills in north because PESCO/IESCO e.t.c can't give them an industrial connection of such big capacity.

It has come to a point where local players are thinking of using own power plants and only using the utility providers for wheeling power.

This is a stupid policy where you give rebates/incentives to foreign FMCGs and MNCs while discouraging investment by local players by using such red tape.

Existing players have to give so much import duties/CDs e.t.c while TSML wants a waiver.

Aise kaise BC.

 

[niaz]

Good points. I would note that iron production will continue to require fossil fuels for the foreseeable future. Most iron ores are iron oxides. In order to free the iron you need to add carbon from fossil fuels to fuse with the oxygen atoms. The by product is carbon dioxide and iron. This can be done in the DRI process using NG or coal gas or in blast furnaces that can use NG or coal.

Honorable Sir,

I have visited quite a few steel mills & blast furnaces over the years. As I understand, the reduction process of iron ore from iron oxides to metallic iron requires ‘Carbon’. This can be in the form of coke, anthracite (naturally occurring smokeless coal) or charcoal.

The chemical; reactions taking place in blast furnace are:

C + O2 ==>> CO2

CO2 + C ==>> 2CO

Fe2O3 + 3CO ==>> 2Fe + 3CO2

Since iron ore is always contaminated with sandy impurities (Silicon Oxide). Limestone (calcium oxide) is always added to the ore as ‘Flux’ which reacts as:

CaO + SiO2 ==>> CaSiO3

Molten iron sets at the bottom forming ‘Pig Iron’ and Calcium Silicate floats at the top and removed as ‘Slag’. I had heard the use of ‘Syngas’ from coal mixed with pulverized charcoal to reduce CO2, & CO emissions. Since natural gas is methane with no carbon monoxide, I would have thought that natural gas as it is would not work. Syngas is made from coal therefore it has a large component of carbon monoxide.

What I had read about DRI (Directly Reduced Iron) process using natural gas was that it is a two-stage process. The first stage being the ‘Catalytic Steam Reforming' of natural gas where the following chemical reaction takes place:

CH4 + H2O → CO +3H2

The reformed gas is mixed with crushed limestone which then reduces the iron ore (Midrex process). However, technology has moved on since I last visited any steel mill (about 15 years ago). Since one never stops learning and you are obviously knowledgeable about the DRI process; is there any modified DRI process that can reduce iron ore without the natural gas being reformed first?

 

[BATMAN]

the mill will be earning for it's Arab owners not gop

why should gop pay from public Pocket unless gop owns majority share

Arab owner could have tippled his investment by simply dragging Pakistan in court of arbitration.
Now coming to the business proposal, it was a win win situation, Pakistan will get real industrial investment and save on foreign exchange which it pays to import steel pallets for PSM.
With industrial investment comes learning, experience, people move on to foreign states and send remittances, educate their children, pay their fees, buy houses.... one industry is a cycle of development forever.
Musharraf regime lured Arabs investors with all sort of promises, but PPP, Jamat Islami, Imran Khan, ANP, PMLN all together made alliance to destabilize Pakistan, and replaced Musharraf with Zardari by unfair means, hence doors of prosperity and progress closed for ever.