The Sajjan Jindal-controlled JSW group is foraying into the cement business by setting up two plants with a combined capacity of three million tonnes in Karnataka and Andhra Pradesh, reports ET. The group has floated a company JSW Cement, which will invest Rs 1,200 crore in the upcoming facilities. The new units will use ash from its power plants and slurry from its steel plants as raw material.

“JSW Cement is planning investments at two locations close to the steel and power plants at Vijayanagar in Karnataka. The AP plant is also near the Karnataka border. The initial investment for the projects will be Rs 1,200 crore. After this project, JSW Cement will consider other investments also,” JSW Energy vice-chairman NK Jain said.

JSW Energy is already operating a 260-MW coal-fired power plant in Vijayanagar while its sister concern JSW Steel owns a captive 230-MW coal-based plant at the same location. It’s also planning a 600-MW imported coal-based project at Vijayanagar. Another 1,200-MW coal-fired project is under construction at Ratnagiri in Maharashtra. The company requires a 10-15 million tonne thermal coal a year to fuel its upcoming power projects. According to rough estimates, almost 3-5 million tonne per year (mtpa) ash will be produced from these plants.

JSW Steel has a 3.8-mtpa upstream steel plant, which produces flat products for automobiles and white goods, at Vijayanagar. This plant is supported by the down-stream facility at Vasind in Maharashtra. The slurry from these plants would be channelled to the cement plant, said Mr Jain. JSW Steel has also firmed up plans to expand its manufacturing capacity 6.8 mtpa by mid-2008, which it aims to ratchet up to 10 mtpa by 2010.

Likewise, the Anil Ambani group is keen on building cement plants using ash from its power plants. Now, its 500-MW Dahanu plant is facing opposition from the locals owing to the huge ash-ponds near the plant. Thus, the group is considering to make brick or cement out of this ash, said sources.

“The cost of cement produced from fly ash and slurry will be 15-20% lower than the cost using the traditional clinker-based method. Moreover, the environment-unfriendly waste materials from the power and steel plants will not be a head ache for the company,” said an industry analyst.