Vedanta’s Orissa project in troubled waters

Bhubaneswar: London-based Vedanta Resources’s chairman Anil Agarwal may be claiming that his projects in Orissa are well on schedule, but the ground reality is somewhat different.

The group’s Rs 8,400 crore aluminium project in Orissa is in serious trouble. With locals snapping the water supplyline to the project, work on the site at Jharsuguda has been affected.

After the farmers denied water from the Hirakud reservoir for the project, Vedanta was relying on water from a small rivulet, Veden, for its project works. However, the locals have stopped that supply source, too. The villagers have been complaining that they were not getting water as Vedanta was sucking up a huge quantity from the rivulet.

Vedanta Aluminium Ltd, a Vedanta Resources company, is setting up a 5 lakh tonne aluminium smelter with an investment of Rs 8,400 crore at Jharsuguda. In the first phase, the company has set up a 2.5 million tonne smelter and a captive power plant (CPP) of 1,215 mw (9X135mw).

Due to the water problem, commissioning of the aluminium smelter and the CPP is likely to be delayed.

The first phase of the aluminium smelter and the CPP is almost complete and ready for commissioning. However, with no water from the Hirakud reservoir, the commissioning could not take place as scheduled.

A couple of months back, the company vice-president (commercial & project), AK Samal had told the media that production from the first phase of 2.5 lakh tonne facilities would commence by March 2008. He had also said that the first phase of the 675mw (5X135mw) CPP of the smelter was expected to go for generation in the new year.

‘’The commissioning is likely to be delayed by about a year’’, said a senior officer involved in the project. According to him, the issue of water from the Hirakud reservoir was not likely to be resolved before the general elections early next year.

The ruling Biju Janata Dal-Bharatiya Janata Party government was unlikely to take a decision that would hurt the sentiments of farmers in the penultimate year to the elections, he added.

Farmers living in the command area of Hirakud reservoir have been agitating against sharing the water with industries. They have destroyed the infrastructure built by industries to source water from the reservoir.

Recently, Agarwal said at Bhubaneswar that the company was ready to invest Rs 30 crore to make temporary measures to source water from the downstream of...