Vedanta board OKs capex plans of $1.5 bn for oil, zinc & steel businesses

Vedanta said that its board has approved capital expenditure plans amounting to $1.5 billion for its oil and gas, zinc, and steel businesses.

The company said that the strategic priority for the Cairn Oil & Gas business is to increase near-term volume through infill wells and add resources through exploration. In order to deliver this, the board of directors has approved a capex investment (net) of $687 million.

Vedanta further informed that at Zinc International, the Gamsberg Phase II Expansion Project at a cost of $466 million will double up Gamsberg's capacity from 4 MTPA Ore to 8 MTPA to produce additional 200ktpa MiC Zinc. It will make Vedanta Zinc International as largest zinc producer of South Africa.

 

Further, it has set aside $348 million for an expansion project at its subsidiary ESL Steel.

The steel expansion project with an investment of $348 million comes with an additional blast furnace of 1050 m3 supported by 0.5 MTPA coke ovens, 1.8 MTPA pellet plant, 800 TPD oxygen plant & other auxiliaries and infrastructure upgradation including railway siding to plant head. This project also comes with a new 0.18 MTPA ductile iron pipe plant which will help us to maximize VAP.

This project along with debottlenecking of blast furnace number 3, sinter plants & new LRF will take the company to the capacity of 3 MTPA with the lowest quartile cost & premium product portfolio.

Vedanta Group is a globally diversified group of companies with a presence in metals, mining, oil & gas, power, telecom, and glass. Vedanta Group has a presence in the electronics and technology business through group companies, Avanstrate Inc. and Sterlite Technologies.

On a consolidated basis, the diversified natural resources firm's net profit rose 26% to Rs 4,164 crore on 50% increase in net sales to Rs 33,697 crore in Q3 FY22 over Q3 FY21.

The scrip rose 0.29% to currently trade at Rs 411.35 on the BSE.

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