State-owned steel major Steel Authority of India Limited (SAIL) has developed new grade of steel that will help the oil marketing companies' plan to give LPG cylinders a more contemporary design and make them lighter. SAIL's new grade steel has already got ISO quality certification and is ready for use after user trials.
The conventional domestic cylinders are made from 2.9 mm thick steel sheets. The new steel developed and produced for domestic LPG cylinders has a higher strength to weight ratio and hence 2.44 mm thickness for the cylinder would suffice instead of 2.9 mm. This will reduce the weight of the cylinders by around 2.5 kgs, CS Verma, SAIL chairman told FE. Currently, an LPG cylinder weighs 15 kg.
SAIL has used the period of flat demand scenario in the steel sector to its advantage by focusing its energy on research and development. The new grade of steel is part of 25 new products developed by the company in 2013-14, all aimed at increasing the share of value added products in SAIL's portfolio.
Around 37% of our revenues are from value-added steel products at present and in the next one and a half year, we plan to increase this to 55%. This will help the company financially as well as value added products allow better realisations, Verma said.
Normally from one tonne of steel, 62 cylinders can be made each weighing 15 kgs. But by using the new grade, from one tonne of steel around 70 cylinders can be made. Moreover, it would be easier to shape and make new design for the cylinders that have not seen much of change for several decades.
SAIL has already supplied 50,000 tonne of this steel to a Faridabad-based entity for fabrication of export quality cylinders. It has now asked oil marketing companies to approve the new steel grade so that it could be commercially manufactured for domestic LPG cylinders.
Earlier, the petroleum ministry had a proposal of reducing weight of domestic cylinders but due to difference in the cost and efficiency mechanics the idea was dropped. There was also a plan to use stainless body for these cylinders but the prohibitive cost of the changeover prevented its adoption. This time SAIL has been pushing very hard towards the new proposal as it would not lead to any substantial increase in steel price.
Bharat Petroleum Corporation