Vedanta to urge Orissa govt for new mines

Mining Major Vedanta plans to request the Orissa government to suggest alternative sites from where it can mine bauxite to feed its one- million- tonne alumina refinery at Lanjigarh in Kalahandi district.

The company sources said the refinery has been running on bauxite sourced from outside Orissa. “ This cannot continue for long, as it would make the operation of the refinery economically unviable,” they said.

Apart from Niyamgiri and Rayagada, bauxite deposits have been found in Keonjhar, Sundergarh and Koraput. But the exact quantity of these deposits has not been assessed. And before mining in these areas is allowed the government has to consider the needs of government- run firms such as National Aluminium Co Ltd ( NALCO). Albeit the state government is yet to give up on Niyamgiri, and is likely to request the Union forest and environment ministry to reconsider its decision, sources said chief minister Naveen Patnaik, too, may consider providing an alternative mining site to Vedanta.

“ The government won’t let Vedanta down as it would send the wrong signals to the industry. Besides, the chief minister seems to have taken it up as a prestige issue,” a senior official said.

For Vedanta moving from Niyamgiri will add to costs. The company had planned to spend ` 10,000 crore on the refinery and mining operations in Niyamgiri put together. It spent a few crores to set up pillars for a conveyor belt at Lanjigarh in the foothills of Niyamgiri. The company also widened the roads leading to the hill.

But now the same facilities will again have to be installed at an alternative site. That means extra expenditure for the firm to transport bauxite from mine to refinery.

Sources said this may also jeopardise Vedanta’s plans to enhance the capacity of its refinery from one million tonnes per year to six million tonnes per year. Vedanta officials and authorities in the Orissa government are keeping their fingers crossed.