With the arrival of coal and raw materials at its jetties, the Pakistan Steel Mills (PSM) will achieve 20% production capacity by July 2014, officials claimed on Friday.
According to a PSM spokesperson, two ships carrying 110,000 tons of metallurgical coal have already reached the jetty.
The first ship – Mega Ocean – carrying 55,000 tons of metallurgical coal from Australia has berthed on Friday, while another ship – Mega Lohori – carrying 55,000 tons of coal from Australia has also reached at the outer anchorage of Port Qasim.
It is pertinent to mention that this is the first coal shipment to be received by the PSM with the help of Rs4.2 billion – part of the governments’ approved financial restructuring package of Rs18.5 billion.
“The workers and staff are occupied in the revival of this national asset under the leadership of Chief Executive Major General (retired) Zaheer Ahmed Khan,” a PSM release said on Friday.
The raw material will increase production level to 20% in July and help in achieving subsequent targets set by the government to reach 77% by January 2015.
However, PSM stressed that the timely release of financial facilities will be of utmost importance.
The management thanked the federal government, especially Ministry of Industries and Production, the Privatisation Commission, Ministry of Finance and related organisations for their positive role in the revival of PSM.
It is also important to mention here that one more iron ore letter of credit (LC) for 50,000 tons will be opened on July 7.
PSM – the only integrated steel mill of the country – has accumulated huge losses, especially in the last six years. Owing to acute raw material shortage, it has been running at an extremely low production capacity of below 5% for the last year – the lowest capacity utilisation in 32 years of its production.
The steel mills has a massive workforce of over 16,000 employees, which, according to many experts, is one of the major hindrance in turning it into a profitable company.
PSM needed a one-time money injection of about Rs20 billion to purchase raw materials to be able to stand on its own feet. The government failed to provide the money in one go and could only manage small instalments.
However, this time, the government has decided to pump in Rs18.5 billion altogether.
PSM is one of the 35 steel mills that the former Soviet Union established in different countries with a standard production capacity of 1.1 million tons. However, Pakistan was one of the few countries that failed to expand their venture, as the mills set up in Iran and other countries are now running at an annual capacity of about 3 million tons.
Published in The Express Tribune, July 5th, 2014.
Like Business on Facebook, follow @TribuneBiz on Twitter to stay informed and join in the conversation.
COMMENTS (1)
Comments are moderated and generally will be posted if they are on-topic and not abusive.
For more information, please see our Comments FAQ
Step 1: Make the things worse Step 2: Make them better and be happy!
Wah rey Pakistan!!