Vedanta hopeful of state resolving bauxite issue

Vedanta Group chairman Anil Agarwal met Chief Minister Naveen Patnaik on Wednesday and sought his intervention in resolving the issue of supply of bauxite to Lanjigarh alumina refinery in Kalahandi district.

“The Chief Minister assured us that the State Government is giving top priority to bauxite supply to Lanjigarh plant and he assured us that the issue will be resolved soon,” Agarwal told reporters after the meeting.

The company utilises only 25 per cent of the capacity of its refinery at Lanjigarh, Agarwal said, adding that the company is importing bauxite to run the plant and therefore, incurring losses. The situation will improve once the company is provided local raw material linkage.

The Chief Minister was positive and assured Vedanta that the matter will be resolved on a priority basis. The State Government also felt there was already delay in providing local bauxite to Lanjigarh plant, he said.

Stating that Vedanta had licence to produce 17 lakh tonnes of aluminium and 50 lakh tonnes of alumina per annum in the State, Agarwal said Vedanta will be the biggest contributor to the State exchequer in aluminium sector and the largest employment giver in the State.

The 1 million tonne per annum (MTPA) Lanjigarh refinery had to be shut down for nearly seven months in 2012-13 and was running much below its installed capacity after it reopened in July 2013 due to acute shortage of bauxite.

With the Centre denying permission for bauxite mining in Niyamgiri Hills after the Supreme Court-ordered referendum saw all 12 gram sabhas in the Hills reject the proposal, Vedanta has been pleading with the Odisha Government for an alternative site to source raw material to run the plant.

Replying to a question, Agarwal said the Chief Minister has indicated about alternative bauxite mines in the State.

Agarwal said the Chief Minister has asked the company to utilise full capacity of the thermal power plants at Jharsuguda. Naveen further told the Vedanta chief to run the smelter to full capacity and set up downstream industries in aluminium sector.

“There is huge potential to set up at least 100 such units by different people. They can manufacture auto-parts, aircraft parts and others in the downstream units,” Agarwal said.

Agarwal also held talks with Chief Secretary J K Mohapatra over the matter.