Adani, Ashapura in JV to set up Rs 10,000-cr aluminium refinery

The Adani Group has tied up with Ashapura Minechem, a multi-mineral solutions provider, to set up a Rs 10,000-crore aluminium refinery at Mundra in Gujarat.

Adani Group Chairman Gautam Adani said the company was negotiating a 50:50 joint venture with the Ashapura group. The project would require 1,000 mw power, which will be sourced from Adani’s Mundra power project.

The refinery will produce one mmtpa of alumina and 0.5 mmtpa of aluminium. An alumina extraction unit will be set up in the first phase at a cost of Rs 3,500 crore. A smelting unit will come up later, taking the overall project cost to Rs 10,000 crore.

Ashapura was planning to set up an alumina refinery since the last five years, but the project had run into legal tangles.

Ashapura had earlier roped in China’s Qingtongxia Aluminium group for a 50:50 joint venture. However, the company pulled out of the project, according to sources close to the development.

Bauxite will be the main raw material used in the refinery. Ashapura has bauxite mines in Gujarat and is buying some more. It also entered into an agreement with the state-owned Gujarat Mineral Development Corporation (GMDC) last year for supplying 2 mmtpa to 2.5 mmtpa tonnes of bauxite.

Ashapura agreed to buy bauxite from GMDC as per the London Metal Exchange price. GMDC has the option of picking up to 26 per cent stake in the project.

Gujarat has nearly 80 million tonnes of bauxite, enough to sustain the refinery for 30 years.