Vedanta Aluminum expects to run 1-mt Lanjigarh refinery unit at full capacity from December

Written by fe Bureau | Kolkata | Updated: Nov 12 2013, 15:03pm hrs
Vedanta Aluminum expects to run its 1-mt alumina refinery at Lanjigarh at full capacity from December this year with the company now able to tie up bauxite from domestic and foreign sources as well.

SK Roongta, managing director, said the Lanjigarh refinery ran at a capacity between 65% and 75% in October and it would run at its rated capacity from December.

The alumina refinery closed down several times for lack of bauxite.

Roongta said the company would meet a third of its bauxite requirement through imports, a third from Balco mines and rest from other domestic sources.

Running the alumina refinery at full capacity was imperative because the company wants to raise its smelter capacity at Jhadsugda in Orissa from the present half a million tonne to 1.25 mt in view of the countrys rising aluminum demand.

Indias aluminum demand is expected touch 5 mt by 2015 and Vedanta wants to cash in on this surge. Bauxite availability is the main impediment without which it cannot run its alumina refinery, which down the line provides raw material for its smelter.

Roongta said for every tonne of aluminum production, 2 mt of alumina is required. So even after running its refinery at a full capacity, the company would fall short of alumina to feed its 1.25-mt smelter.

Roongta said Vedanta approached Nalco for supply of alumina but there is no settlement as yet.

Vedanta offered to pay $50 more for per tonne of alumina but Nalco is yet to get the government clearance. Nalco, which sold 30,000 tonne of alumina at $ 335 per tonne in FY13 is supposed to export its entire production, a Vedanta official said.

According to the official, Vedanta planned to increase its refinery capacity to 2.3 mt by 2015 to feed its 1.25-mt smelter. But expansions have been put on hold for lack of bauxite.

Roongta said India could become a global hub for cheap aluminum production if the countrys resource sector was properly developed. India can produce aluminum at $1,200 to $1,300 per tonne against the global average of $2,000 per tonne mainly for availability of cheap power, he said.