Vedanta to expand Odisha alumina refinery to 6 MT without Niyamgiri

2018-08-24

Aug. 23, 2018 - Mining baron Anil Agarwal's Vedanta Ltd plans to expand its alumina refinery at Lanjigarh in Odisha to 6 million tonnes per annum by 2021 using alternate bauxite resources as it looks beyond the failed Niyamgiri experiment, a top company official said.

The firm believes there are enough alternate resources of bauxite available to feed the expansion and has moved beyond the previously pursued high-quality bauxite beneath the pristine Niyamgiri hills, its CEO for Alumina and Power Business Ajay Kumar Dixit said.

The Lanjigarh plant produced around 1.2 million tonnes of alumina last fiscal and has a current capacity of 2 million tonnes.

Refusing to give cost estimates, Dixit said while the plant currently imports 2.5-3 million tonnes of bauxite and sources almost an equal volume from domestic mines, the expansion project would need a total of 18 million tonnes of bauxite annually.

"A lot of stigma was attached whether Vedanta could run without Niyamgiri. The fact is Niyamgiri would have given us 2.5-3 million tonnes, whose absence hardly makes any difference (to the expansion)," he said. "The ghost of Niyamgiri is done and dusted. We are well past it."

Vedanta had intended to supply the refinery with bauxite extracted from the Niyamgiri hills by a mining company owned by the state government, which backed the project. But protests from local villagers led to the union government and the Supreme Court blocking the move in 2013.

Dixit said the company would continue with the current mix of imported and locally sourced bauxite before converting to a plant that used only the domestically sourced resource.

"We believe why should foreign currency go out when India has enough resources," he said hoping to bid and win rights for local mines or linkages in near future.

Odisha has 700 million tonnes of known bauxite reserves, of which Niyamgiri holds an estimated 88 million tonnes. "An equal amount of reserves is unexplored," he said adding the state has the potential to become the bauxite capital of the world.

Odisha has 70 percent of India's total bauxite reserves, the world's fifth-largest. He said Vedanta would participate in auctions of new bauxite mines to feed to expansion.

Currently, costly bauxite is imported from as far as Brazil and Guinea at a port in neighbouring Andhra Pradesh before being moved by trains 275 km to Lanjigarh.