The government may revive National Steel Corp. either as a $5-billion integrated steel facility or a $3-billion rolling steel plant pending the result of an ongoing study by a Korean company, presidential adviser for economic affairs Ramon Jacinto said Wednesday.
“We are looking at the revival of National Steel, but we have to get through the financial hurdle because there are standing loans with the banks. We need the cooperation of the banks,” he said.
Another site being proposed for the new steel mill with Philippine Veterans Investment Development Corp. is Misamis Oriental province, which the Jacinto family had earlier considered.
The Jacinto family owned a stake in National Steel until the Marcos government sequestered it in the 70s.
“That’s secondary even if we end up not owning it, it’s okay as long as the facility will be constructed. I would rather that foreign investors own most of it but the important thing is we have to build the steel mill already while the President is in power,” Jacinto said.
The study will determine if the proposed revival scheme was feasible given the depreciation factor and the financial viability of the project.
The government would need foreign investor contribution in the form of technology transfer, said Jacinto, with the funding to be secured through syndicated loans.
SteelAsia Manufacuring Corp. has offered to acquire National Steel in a letter recently sent to the Board of Investments.
“But SteelAsia is only interested in a certain part of the land so they can put up a plate mill and a structure steel mill for the long product. And they want access to the ports, as well. They still have to deal with the banks and tax liabilities, that has to be settled,” Jacinto said.
Real estate taxes of the mothballed have ballooned to P2 billion to 4 billion.
Despite liabilities, the value of National Steel has grown because of its property assets, sound infrastructure and machineries.
Another proposal that might work, Jacinto said, was to build a new facility that would manufacture slabs that it could sell to National Steel.
“This will give way for the revival of National Steel where it can build any form of steel it wants to produce using the slabs,” he said.
Jacinto said a new facility would cost about $3 billion for a 3-million metric ton capacity.
National Steel during its operational days could produce as much as 1 million MT of long steel bars.
