Described as the biggest single foreign direct investment in the country, the Korean project would involve a 12 million tonne steel plant and development of the Paradip port.
"The MoU will be signed tomorrow and all the preparations have been made for the purpose", Padmanav Behera, Minister, Steel and Mines said.
A 32-member Korean delegation comprising the Posco chairman Ku Taek Lee and Korean ambassador Jung Il Choi would be arriving in Bhubaneswar for signing the MoU, he said.
The MoU would be signed in the backdrop of strong objection to any provision for export of iron ore from the state by the Korean company by the CPI, CPI(M), OGP and Janata Dal (S).
A delegation of the four parties visited New Delhi and met the Prime Minister Manmohan Singh on June 17 last to express their misgivings about some of the provisions in the MoU including the export of iron ore from the state.
The memorandum submitted to the Prime Minister by the delegation also pointed out that with a plethora of MoUs signed with different companies for setting up of steel plants in the state, the iron ore deposits would be exhausted in a few years. This was a confused agenda, which lacked vision, it said.
The Prime Minister, leaders of the four parties said, had promised the delegation to examine the matter while assuring that nothing would be done which would be against the national interest.
Ruling BJD leader and former Union steel minister Braja Kishore Tripathy had expressed his objection to the move to allow Posco to export iron ore from Orissa.
Rajya Sabha MP Surendra Lath, who belonged to the BJP, a coalition partner of the BJD in the state, recently expressed his misgivings over the project while asking the government to "carefully consider" the pros and cons of the whole matter.
The state government's project clearance authority gave the go ahead to the project on June 17 last. Steel and Mines Minister Behera said the company had suggested that it should be allowed to import iron ore from Brazil as the locally available ore had high alumina content.
The company had been told that it had to first import the iron ore after which an equal quantity of the ore could be exported from the state, he said.
The minister said that the government had identified 5,500 acres of land near Paradip for the mega project of which 4,000 acres would be required for the steel plant.
The rest 1,500 acres would be used for setting up a township for the plant employees. Fifty percent of the steel produced by the company would be exported while the rest would be sold in the domestic market, Behera said.
The centre had assured the state government that it would assist in the creation of infrastructure for the mega project including expansion of roads and highways and railway linkages at a cost of Rs 1700 crore (Rs 17 billion).
Posco, however, would expand the port facilities at Paradip to enable huge vessels of 2,50,000 dwt to sail in and out of the harbour, he said.
The project, which would start with three million tonne capacity initially, would fetch revenue for the government to the tune of Rs 700 crore (Rs 7 billion) to Rs 800 crore (Rs 8 billion) annually. It would provide direct employment to 13,000 people and ensure indirect employment for 35,000 others, the minister said.
