Hindalco and Vedanta wish to join CIL’s greenfield aluminium project as equity partners

Indian aluminium giants like Hindalco and Vedanta have shown interest in joining hands with Coal India Limited as equity partners for the proposed integrated greenfield aluminium project in Odisha. The news comes on Wednesday, July 6, after two officials aware of the matter reported, stating that several other companies in West Asia have also responded to CIL’s interest (EoI) for equity partners invitation in the greenfield project.

As per the report, the project will include bauxite mining, alumina refinery, primary aluminium production, and an associated coal preparation plant.

One of the two officials said: “Most domestic companies are interested, including Vedanta and Hindalco, as equity partners,” one of the two officials said on condition of anonymity. “During the pre-bid conference, parties from the Gulf showed interest. Actually, a lot of electricity is required to produce aluminium, and in the Gulf, electricity production using gas is cheaper. But they don’t have bauxite, so they buy alumina from India, which is made from bauxite, and use it to produce aluminium with cheaper electricity and sell it worldwide. Now, they have shown some interest in our plant.”

A second official said the government would most likely hold a majority stake and management control in a special purpose vehicle (SPV) that would implement the proposed aluminium project to the chosen private entity.

Upon an enquiry on this, Vedanta and Hindalco have remained quiet so far.

In June 2022, Coal India revealed its plan of diversification into aluminium, solar power and coal gasification to decarbonise operations, following the approval from the state government panel chaired by chief minister Naveen Patnaik. Currently, CIL is waiting for the allocation of a suitable bauxite block at Sijimali or Kutrumali in Odisha.

Coal India has also visited a site in Rayagada district, the proposed site for an alumina refinery, and Neulapoi, the proposed site for an aluminium smelter and coal preparation plant.

Decarbonisation process gained momentum at state-run firms since the government began focusing on net-zero carbon emission and energy transition.