ISLAMABAD, May 7: Pakistan Steel (PS) would invite international tenders for expanding its capacity from 1.1 million tons to 4 million tons in one go if a deal is not finalized soon on a government-to-government level.

The PS chairman, Lt-Gen (Retd) Abdul Qayyum told reporters here on Friday that government's first priority was to strike a deal on government-to-government level with Russia, China or Ukraine through that country's credit.

An MOU in this regard was signed with Russia last year during President Gen Pervez Musharraf's visit to expand the plant capacity to about two million tons but the agreement has yet to be materialised because of financial issues. China and Ukraine later also entered the race on government level.

"However, if we have to spend our money for the expansion then I would float an international tender to invite all those international companies which are making a beeline to take up the job at competitive rates," he said.

In that case, he said the company would use its over Rs4 billion profit that it was expected to earn during the current fiscal year for expansion plans and float its shares at the stock exchange.

Further, the company required around $100-150 million for revamping and refurbishment of its 25-year old machinery. The amount would be generated through its own earnings.

Responding to a question, he confirmed that the PS had recently floated a tender for the import of billets but only one bidder turned up and that too was not up to the mark. The company planned to re-tender the billet import very shortly, he said.

The PS, he said, had hired AKD Securities as financial consultant and was in the process of hiring reputed international auditing firms and management services consultants to turn the company into an internationally recognised steel firm.

He said he had recently inducted 200 top class engineers from across the country through an independent selection board and had written to AJK President and governors and chief ministers of all the four provinces to seek nominations for 200 apprentices on the basis of their quota.

He said Pakistan's total steel requirement was about four million tons but its local production was just 1.1 million tons and the rest of the requirement is met through import or ship-breaking.

Mr Qayyum said Pakistan Steel required a total of 60 ships of 50,000 tons of imported raw material including 24 ships of coal and 36 ships of iron-ore. Responding to a question, the PS chief said that recent steel crisis was a result of trade war between China and the United States that blocked scrap and raw material supplies to Pakistan.

He, however, said the prices of steel which was made of PS' first class billets had now come down from Rs55,000 tons to Rs38,000 tons while that of low quality steel was now available at around 27,000 per ton.

He said the PS has secured 70 per cent of the raw material requirement for the next year while rest of the 30 per cent would be arranged in due course of time and would not be a problem as such. "We can say with confidence that we are now safe for the next year as well."

The PS chairman said the mill that was running at 93 per cent capacity in January this year had to reduce its production to 59 per cent in February and March due to steel crisis and that too through a nerve-shaking exercise of re-utilising raw material waste to keep the plant burning to avoid big losses.