The move is expected to make HZL the world's largest integrated zinc-lead producer by 2010.
The company is planning two brownfield smelter projects at Rajpura Dariba in Rajasthan, which will increase the production capacities of zinc and lead by 2,10,000 tonne and 100,000 tonne respectively.
The company is also planning to increase its silver production from the current level of 100-120 tonne per year to a level of 500 tonne per year in the form of silver and silver bearing residue. A large part of the increase would be from the Sindesar Khurd mine where silver occurrences are at levels of 200 ppm and from the use of appropriate technology in the new smelters.
The expansion will be supported by HZL's strong reserves and resources of 232.3 million tonne containing 27.5 million tonne of zinc-lead metal at March 31, 2008. The reserves and resources position have been earlier independently reviewed and certified as per the JORC standard.
To support the increased smelting capacities, HZL will expand its ore production capacity at the Rampura Agucha mine from 5 mtpa to 6 mtpa. Further, ore production at the Sindesar Khurd mine, the new star in HZL's mining portfolio, will be increased from 0.3 mtpa to 1.5 mtpa. HZL will also start mining activity at the Kayar mine, which will have a production capacity of 0.3 mtpa.
In order to be a fully self reliant producer of power, the company is also planning a captive thermal power plant with a capacity of 160 mw at Rajpura Dariba.
The zinc and lead smelters as well as the captive power plant and the Rampura Agucha mine expansion will be complete by mid-2010. The expansions at the Sindesar Khurd and Kayar mines will be completed in phases by early 2012.
The total investment, estimated at Rs 3,600 crore, includes the cost of the smelters, captive power facilities, mine development and shaft sinking and other infrastructure.