Calcutta, Feb. 5: Adhunik Metaliks has signed a 10-year contract with BOC India for gas supply to its Rourkela facility. This will help the city-based value-added steel maker raise its capacity to 4.5 lakh tonnes.

Under the agreement, BOC India will set up a 100-tonnes-a-day air separation unit at Rourkela Steel Works of Adhunik Metaliks.

Adhunik Metaliks completed its first phase of capacity expansion at 2.5 lakh tonnes during the first half of the current financial year.

It has now embarked on the second phase that will take the alloy and stainless steel making capacity to 4.5 lakh tonnes per annum.

The capacity expansion is likely to be completed by 2008. The company is present in Bengal, Orissa, Jharkhand and Meghalaya.

Adhunik’s expansion plan includes addition of a coke oven plant, an oxygen plant and a captive power plant and development of captive iron ore and coal mines.

BOC India, now a member of the Linde Group, will supply oxygen for 10 years under the agreement.

“Adhunik Metaliks was looking for a gas partner. BOC is known internationally as a quality gas manufacturer. This was a key factor in selecting us for supplying oxygen, nitrogen and argon to its steel works,” said E.R. Raj Narayanan, managing director of BOC India.

“The steel sector has traditionally provided us with a good momentum of growth and we are proud to add Adhunik Metaliks to our list of customers,” he added.

“I see this contract as the beginning of a long-term relationship with the Adhunik Group and a further consolidation of our presence in eastern India as a leading gas supplier,” Narayanan said.

Adhunik Metaliks is considering a foray into forging and is looking at acquiring a company either in Germany or the US.

The company eyes a forging capacity of 1 lakh tonnes by 2008. It has set aside Rs 3,000 crore for the buyout.

Adunik Metaliks has recently acquired Unistar Galvanising and Fabricators to enter power transmission tower manufacturing.