production by Vedanta
for the quarter ended September 30, 2017 fell eight per cent year-on-year as bauxite
availability from its captive mines held by Group company BALCO
The total alumina
output in July-September quarter was 269,000 tonnes as against 292,000 tonnes achieved in the corresponding period of the last financial year. When compared to the April-June quarter, alumina
output at Vedanta's Lanjigarh refinery in south Odisha was down by 11 per cent.
A source at Vedanta
attributed the dip in production to logistics constraints. “There are transportation issues. We did not get sufficient rakes to carry bauxite
mines to our refining unit,” he said. The company official, however, sounded upbeat on meeting the alumina
production target for this financial year. The company looks to close FY17 with an alumina
output of 1.8 million tonnes from the Lanjigarh refinery.
Also, the recent spike in spot global alumina
prices would not have much implication for Vedanta.
“The recent rally in alumina
prices is the fall out of some supply shortfall in China. We believe this is a temporary phenomenon and would not hold on for long. Vedanta
has long-term contracts with bauxite
suppliers in Guinea and Australia
and this hedges us against vacillating prices,” he added.
The refinery located at the foothills of the bauxite
laden Niyamgiri mountain range, has a rated capacity of six million tonnes per annum (mtpa). Vedanta
has permits to produce four mtpa. But, the refinery was operating at less than half of the approved capacity as local bauxite
has been running the refinery by sourcing bauxite
from the BALCO
mines in Chhattisgarh. It also imports the raw material from New Guinea and Australia.
lost the bid to mine the ecologically fragile Niyamgiri hills, it has been appealing to the Odisha government for arranging local bauxite
from alternative sources. Local tribes made up mostly by Dongaria Kondhs, unanimously nixed the mining plan during July-August 2013 in a referendum held as per the Supreme Court's order. Barring a few small laterite mines with traces of bauxite, the state government has not been able to come to the rescue of the starving Lanjigarh refinery.
Though the state controlled company - Odisha Mining Corporation (OMC) has some good quality bauxite
deposits in Karlapat, Sasubohumali and Kodingamali leases, mining as not taken off yet due to lack of regulatory clearances.
"We are open to sourcing bauxite
from OMC. It could be either a long-term linkage arrangement or buying at e-auctions. Vedanta
is also awaiting auctions of bauxite
assets in Odisha where we intend to participate," the official said.