PTI reported that Vedanta group is likely to close its one million tonnes alumina refinery at Odisha's Lanjigarh from December 5th 2012 a move which would impact about 7,000 jobs in the Eastern state.
The mining conglomerate which runs the alumina refinery through an unlisted subsidiary, Vedanta Aluminium Limited had given a closure notice to the state government three months back citing severe shortage of bauxite as the primary reason for the shutdown.
A senior company official said that suspension of operations of Lanjigarh alumina refinery is imminent from December 5th 2012 due to non availability of bauxite. We can not help it. Odisha government is yet to give any assurance on bauxite availability. In its absence running the plant is not sustainable.
He said that we had given a 3 month notice in September to the state government to close operations from December 5th 2012 and we are sticking to that date. For last several months we have been running the plant at lower capacities and incurring losses.
VAL, in its closure notice to Odisha's labour and industries department served on September 5, had said that running the alumina refinery is no longer sustainable unless Odisha government finds a solution for supply of bauxite. The shutdown of refinery is likely to impact 2,500 workforce directly and 4,500 persons indirectly. However we are not thinking of any retrenchment at the moment.
The company has invested INR 50,000 crore in the refinery along with an aluminium smelter of 1.5 million tonne per annum and a captive power plant.
Top officials of Vedanta group including its chairman Mr Anil Agrawal and VAL's Managing Director Mr SK Roongta had also met Chief Minister Mr Naveen Patnaik and state chief secretary in the last 3 months to seek an alternate supply arrangement of bauxite.
According to Vedanta, the Lanjigarh refinery was meant to use high grade bauxite which is available in the mines of Odisha and runs on environment friendly low pressure and low temperature technology.
The Vedanta official said that we had constructed the refinery on the premise that bauxite will be sourced from the state itself. However, that promise is yet to be fulfilled. Only one mine Damanjori of NALCO, which is PSU has become operational in the state in last 25 years.
