A day after shutting down its bauxite refining unit at Lanjigarh temporarily citing unavailability of bauxite ore, Vedanta Aluminium Limited (VAL), has said it can hardly run its smelter facility at Jharsuguda for a month in the absence of enough alumina to run the plant.
“Amid raw material supply problems, we can run the smelter plant hardly by a month or so,” said an official of VAL smelter plant.
The company has invested in two greenfield aluminium smelting plants at Jharsuguda. While the first smelter with a capacity of 0.5 million tonne per annum (mtpa) capacity is producing aluminium using alumina processed at Lanjigarh, the work on the second smelter with 1.1 mtpa capacity is currently on.
With the Lanjigarh refinery now shut down, the fate of the aluminium smelter at Jharsuguda is also doomed, sources said.
Earlier, VAL had decided to participate in the alumina export tender of its competitor National Aluminium Company (Nalco) to buy alumina for its smelter. But this has been vehemently opposed by the empluees unions of Nalco.
Yesterday, VAL had started the process of shutting down the Lanjigarh alumina refinery after it had become increasingly difficult to keep its operation afloat amid bauxite stock dwindling to zero level. Though the company, through an advance notice, had sounded the state government last month to close the refinery on December 5, it pre-poned the closure process.
“Unless and until we have bauxite stock for at least 10-15 days, we have to keep the refinery plant closed,” Mukesh Kumar, Chief Operating Officer and President, VAL.
The company has already intimated the Kalahandi east electrical division of Western Electricity Supply Company (Wesco) regarding its intention to close its captive generation plant. The company will source 8-10 MW power from the state grid for idle running of systems of the plant and township.
“We are trying our level best to source bauxite and have already sent a team to Gujarat for sourcing of the raw material,” Kumar said.
Vedanta had won the contract for sourcing 90,000 tonnes of bauxite, but the supply of which are likely to commence only after 10-15 days.
The company is also waiting for the withdrawal of Ministry of Environment and Forest circular for environmental clearance required at the time of renewal of mining lease which has been nullified by the Delhi High Court for sourcing of bauxite from Jharkhand and Chhatisgarh.
The aluminum major has been running its one million tonne per annum refinery at 25-30 per cent capacity for last 8- 10 days. To run the refinery plant at full steam, VAL needs 300,000 tonnes of bauxite every month.
The closure of the refinery is set to put at stake livelihood of 6,500 people, including 550 employed directly, 5,000 engaged indirectly and 1,000 self-employed in and around the plant. The company claimed to have spent Rs 150 crore on the development of the local area and community.
VAL has not been allotted any mining lease in Odisha and fully depends on externally sourced bauxite to run its refinery. It had entered into a pact with state controlled miner Odisha Mining Corporation (OMC) for supply of bauxite from Niyamgiri hills. However, this was red flagged by the Union environment ministry which scrapped the Stage-II forest clearance of the mining project on August 24, 2010.
Following Niyamgiri debacle, VAL had filed 26 applications with the state government, seeking alternative bauxite deposits. But the state government is yet to take any action on them.
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