MAC: Mines and Communities

Indian activist calls Vedanta's bauxite bluff

Published by MAC on 2012-09-18
Source: Hindustan Times (2012-09-18)

Earlier this month, we criticised London-listed Vedanta Resources for trying to bully India's Orissa government into granting the company bauxite leases, by pleading a dearth in ore to feed its Lanjigarh alumina refinery. See: Calling Agarwal's bluff?

Now, one of the state's leading civil society activists goes a step further - urging the government "stop playing to Vedanta tunes", scrap the alumina plant, and declare the adjacent Niyamgiri bauxite deposit a National Biodiversity Heritage Site.

Earlier, Vedanta Aluminium's chief operating officer claimed that only certain parts of India - specifically Orissa - host bauxite of a grade that's suitable for the refinery.

As we pointed out at the time, the factory has actually received ore from a number of different sources since it was opened, including from Vedanta's own mines in Chhattisgarh.

Belatedly, this fact has been acknowleged by Vedanta itself.

Petitioner against Vedanta condemns company for 'misleading' public

Hindustan Times

18 September

Bhubaneshwar - Prafulla Samantara, a petitioner against Vedanta group, on Tuesday condemned the company for allegedly trying to mislead the public and influence the Supreme Court by organising "fake and engineered protests" in Odisha.

Vedanta Aluminium Limited, a subsidiary of the London Stock Exchange listed multi-billion dollar Vedanta Resources group, had told the Odisha government on September 6 that it wanted to temporarily shut down its alumina refinery in Lanjigarh in Kalahandi district, more than 500 km southwest of Bhubaneswar, within three months due to lack of bauxite.

Following the move by the company, Vedanta staff and some local people held a rally in the district headquarter Bhabanipatna and sent a memorandum to the state government demanding arrangement of bauxite for the company.

"The pro-Vedanta rally in Kalahandi is clearly intended to influence the proceedings of the Supreme Court on Niyamgiri issue that is being fought by state owned Odisha Mining Corporation for Vedanta.

This should be taken as a case of interference with the proceedings of a court," Samantara, convenor of voluntary group Lok Shakti Abhiyan, told reporters in Bhubaneshwar, adding that the company had started a calculated media campaign before sending the shutdown notice to the state government.

Samantara asked the state government to stop playing to "Vedanta tunes", scrap the alumina plant and declare Niyamgiri a National Biodiversity Heritage Site.

VAL has not been able to get bauxite from Niyamgiri hill - home to nearly 10,000 endangered Dangria Kond tribals - adjoining the refinery despite an MoU with the state government in 2004.

Since starting operations in 2007, the refinery was sourcing bauxite from Chhattisgarh, Andhra Pradesh, Jharkhand and Gujarat. "We ran the plant at less than 60% of capacity.

Initially, the loss was around Rs. 2 crore per day, but now it has risen to Rs. 4 crore a day, taking the accumulated loss so far to Rs. 3,000 crore," Mukesh Kumar, president and chief operating officer of VAL, had said after sending the shutdown letter to the state government.


Odisha says it cannot supply bauxite to Vedanta Aluminium Limited immediately

PTI

18 September 2012

BHUBANESWAR: Odisha is not in a position to immediately supply bauxite to Vedanta Aluminium Limited (VAL), the state government said today while the company had sought permission to shut down its refinery at Lanjigarh due to scarcity of raw material.

"The state government is not ready at the moment to supply bauxite to Vedanta's refinery at Lanjigarh. VAL's case in the matter of bauxite mining is pending in the Supreme Court ... They (VAL) are trying to arrange raw material for the plant," Chief Secretary B K Patnaik told reporters after attending the High Level Clearance Authority (HLCA) meeting.

Though the state has a vast reserve of the mineral, it is not able to explore it due to different reasons including forest clearance and mining plan, he said.

The state government's stand was made known after VAL formally informed the administration to allow it to shut down the refinery from December 5.

When contacted VAL Chief Operating Officer Mukesh Kumar said "We have already informed about our problem to the state government. Now our 1 mtpa refinery plant is running with only 50 per cent of its capacity due to bauxite scarcity."

Kumar said despite the state government's commitment to supply raw material to the refinery, it not given 'even one gram' of bauxite so far.

Under the situation, the company had already incurred Rs 2500 crore loss to run the Lanjigarh refinery and was not in a position to procure bauxite from other sources.

"We have run the plant for five years by bringing in bauxite from states like Andhra Pradesh, Jharkhand, Chhattishgarh and Gujarat ... We get some bauxite from our BALCO mines. And that source is not sufficient," he said.

The VAL COO in his letter requested the state government to help it by providing the raw material for running the refinery plant after December 5.

"If the situation improves by December 5, the company may not shut down the plant."

VAL has so far invested Rs 9,000 crore in the project which employes about 7,000 people, including direct jobs to 3,000 persons, Kumar said.

Though the company had applied for 26 bauxite reserves in the state, nothing was finalised yet due to different reasons, company sources said.

The company required 10,000 ton of bauxite everyday to feed its 1mtpa refinery plant.

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