Tension at Lanjigarh alumina refinery subsides after mutual discussion

According to a recent report, the tension between locals and authorities of Vedanta alumina refinery at Lanjigarh in Kalahandi district has subsided today on March 19, after a mutual discussion between the two parties.

The tension had taken place on Monday, March 18, after Rengalpali villagers tried to break into the factory to demand jobs.

However, urging for peace Vedanta spokesperson had stated, "We will submit our statement to the authorities and provide every support to resolve the matter. We urge the people of Lanjigarh Block to maintain peace."

Vedanta Limited has proposed to invest $250 million to $300 million in the next fiscal, in a bid to expand the capacity to six million tonnes per annum from its current 1 million tonnes, according to reports early this year. As per domestic reporting, metals and mining giant Vedanta expects to recover the invested sum within two years, banking on locally sourced bauxite to trim logistics costs.

The impetus for such a dramatic move is Vedanta’s agreement with the Odisha Mining Corporation (OMC), which has it sending fully 70 percent of its mined bauxite, approx. 250 thousand metric tonnes per month, to the Lanjigarh alumina refinery.

“Every tonne of aluminium produced with the Odisha sourced bauxite which can be used in expanding refinery capacity, will give us Ebitda (earnings before interest, taxes, depreciation and amortisation) advantage of $400 per tonne. So, if you are able to cover 50 per cent or 60 per cent of our requirement, then to that extent, $200 to $250 straight away goes up in the Ebitda margin on a permanent basis because reserves will last easily for 15 years and more mines will come up”, Arun Kumar, chief financial officer of Vedanta Ltd at the company's recent results conference call.