Steel Authority of India plans to build a 10 million tonne steel mill in expectation of beating ArcelorMittal for the rights to control the nation's biggest iron ore reserves.

Mr SK Roongta in an interview, without specifying the cost or timeframe, said that sites for a plant to exploit the Chiria deposit in Jharkhand are being shortlisted.

Mr Roongta said that Steel Authority has hired MECON to prepare a detailed project report.

He added that every 1 million tons of capacity may cost as much INR 4 billion.

Mr AS Firoz an independent steel analyst and former chief economist at India's steel ministry said that "Anyone who wants to put up a large sized plant is looking for a big deposit instead of fragmented ones. Chiria is attractive as its one of the few large deposits available in Jharkhand."

Steel Authority, which won back the right to half of the 2 billion deposit last month is battling ArcelorMittal, TATA Steel Ltd and JSW Steel Ltd for control of the rest of Chiria, the deposit with iron content of as much as 65%.

(Sourced from Bloomberg)