South Korean steel major, Posco has decided to set up an 8 million tonne per annum (mtpa) greenfield steel plant near Paradip in Odisha, downsizing its earlier plan of establishing a 12 mtpa steel plant.

This was decided at a meeting held at Bhubaneswar last night between Odisha Chief Minister Mr Naveen Patnaik and Posco-India Chairman-cum-Managing Director Mr YW Yoon.

Mr Yoon told reporters after the meeting that Posco-India would start the project work as soon as the state government hands over 2,700 acres of land for setting up of 8 mtpa steel plant.

He said the company had so far been given only 500 acres of land for the purpose though the government claimed to have acquired about 2,000 acres.

Though the company is going to set up 8 mtpa steel plant in two phases now, Yoon did not rule out possibility of expanding the project to the original plan of 12 mtpa if additional land is made available.

On National Green Tribunal's rejection of environmental clearance to the project, the Posco-India CMD said they were in consultation with the Ministry of Environment and Forest of the Government of India.

Posco-India which had proposed to set up a 12 mtpa steel plant near Paradip at an investment of Rs52,000 crore, said to be the biggest FDI in the country, had failed to pick up due to various issues including stiff resistance from locals under Ersama block of Jagatsinghpur district in Odisha.

The Odisha Government and the company had signed an MoU on 22nd June 2005 to set up a plant near Paradip.