Forbes, April 12, 2007
LONDON (Thomson Financial) - Vedanta Resources PLC said production in its fourth quarter exceeded the previous quarter following successful de-bottlenecking activities.
However, the FTSE-100 company warned that while sales volumes across all three metals - aluminium, copper and zinc - were higher, prices of copper and zinc witnessed a downward trend in the latest quarter. Also it noted that import tariffs on metals in India, where most of its operations are based, were reduced from 7.5 pct to 5.0 pct in the last week of January.
Copper cathode production at its Indian and Australian operations rose to a record 89,000 tonnes for the quarter to end March, in line with a consensus forecast of eight analysts, from 86,000 tonnes in the third quarter. Production was helped by a capacity increase at the Tuticorin smelter in India.
'Production after successful de-bottlenecking is steadily ramping up and contributing towards additional volumes in Q4, with production close to rated capacity in March 2007,' the company said.
The Tuticorin smelter was under planned shutdown for eight days in the first week of April.
Mined metal production at its Australian mines was lower than that of the corresponding period the previous year following a minor rockfall incident, but mining activities were restored in March and are expected to pick up to normal levels in the current quarter, it said.
Its Zambian operations produced 37,000 tonnes of copper cathode in the quarter, beating the preceding quarter's 35,000 tonnes but falling short of the consensus of 39,000 tonnes. It will carry out a partial plant shutdown in April for 20 days for a major overhaul.
Fourth-quarter aluminium output was 98,000 tonnes, in line with forecasts and unchanged from the third quarter. Aluminium output for the fiscal year jumped 67 pct to 351,000 tonnes helped by the full ramp-up of the new Korba smelter. The stabilisation process of the Korba smelter was quicker than estimated and the plant has consistently achieved rated capacity in the last two quarters, the company said, adding that production from existing smelters at BALCO and MALCO was marginally higher than their rated capacity.
Total refined zinc production for the fourth quarter was also in line at 95,000 tonnes, up from 93,000 tonnes in the third quarter, as the company continues to ramp up a new hydro smelter.
However, gold output was lower during the quarter at Sterlite Gold Ltd due to the suspension of mining operations.
Vedanta also provided an update on its projects.
Progressive commissioning of the alumina refinery at Lanjigarh started in the last week of March and alumina output is anticipated to start by the end of the first quarter of FY 2008, and basic engineering work on the new 1.9 bln usd greenfield 2,400 megawatt integrated power project at Jharsuguda has recently started and is progressing as scheduled.
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