In a much-needed relief to Vedanta Ltd., a three-judge Supreme Court panel on Tuesday it to bid for alumina sale tenders by state-run National Aluminium Company Limited (NALCO).
This means that Vedanta’s foreign units can bid for NALCO’s alumina tenders meant for exports. If its bid is successful, the company the company can use the raw material at its Jharsuguda, Odisha plant after picking it up from Visakhapatnam port, it said. It may be recalled, that Vedanta’s aluminum unit is seeking to boost supplies of the raw material.
Last year, NALCO had challenged Odisha High Court’s decision allowing Vedanta to take part in the tenders for the sale of its surplus alumina. The lower court had accepted Vedanta’s argument that it was eligible to participate in the tenders as it operated from an export-oriented zone.
Why alumina is important for Vedanta?
Alumina is of immense value to the company as it plans to raise its aluminum smelter production capability by 30% to 3 million tons in the next couple of years. However, the company has had no choice but to buy alumina from other local miners or import it because although it has an alumina refinery and a smelter in Odisha, it lacks adequate bauxite supplies; the reason being the the tribes of Niyamgiri stopped its bid to mine in the remote hills.
Meanwhile, NALCO exported 1.24 million tons of alumina by March 2019. Its refinery has the capacity to produce 2.28 million tons of alumina in one year. It exports its surplus to buyers mostly in the Middle East, Southeast Asia and China.