KOLKATA: Essar Steel has decided to scale up its steel production at its Hazira plant to 2.4 million tonne, next fiscal, from current levels of 2 million tonne.

Part of Essar Steel's increased production of hot rolled coils (HRCs) will be consumed captively by Stemcor, UK, which is setting up a cold rolling mill adjoining to Essar's integrated steel unit.

Speaking to newsperson after addressing a seminar on metal industry in Kolkata on Wednesday, Mr Prashant Ruia, managing director, Essar Steel and director Essar Group also said that they are awaiting government's clearance to start work at the Ratna-R series of proven oil and gas offshore blocks. Essar has a controlling interest of 50 % wile ONGC has 40 % and Premier Oil has the remaining 10 % interest. Oil production from the Ratna fields will start off by 9-12 months once government provides the final clearances.

Essar is also looking at entering into power distribution and generation business depending on government's final policy direction on distribution licensing norms to allow private players to enter distribution. Government is expected to spell out the norms sometimes next month, Mr Ruia added.

The project had run into rough weathers following differences utilisation of revenue from the oilfields for funding Essar's refinery project. "Now that ICICI Bank has certified that there is no mortgage against the Ratna fields, we are awaiting government's permission to start work," he added.

Geo-physical work for Essar's coal bed methane (CBM) block at Ranigunj in West Bengal has also started and actual drilling is expected some once the reserves are established.