VEDANTA would invest about $8bn over the next three years in order to increase its production of oil, aluminium and zinc, said Bloomberg News in an interview with the Indian mining firm’s executive chairman, Anil Agarwal.
“We are looking to make about $8bn investment which includes 500,000 barrels of oil and to increase aluminium production by 1 million tonnes (Mt) and zinc capacity by 800,000 tonnes,” he said. “It should be comfortable to manage the expansion as our income is expected to be around $25bn over this investment period,” he said.
He also plans to expand the capacity of the newly-acquired Electrosteel to 2.5Mt at a cost of $300m. India’s steel demand is around 300Mt and currently, it’s producing only 70Mt, said Bloomberg News.
Vedanta is starting to ramp-up production from its Gamsberg zinc mine at Aggeneys in South Africa’s Northern Cape in a development which has huge potential benefits for both the group and the Northern Cape region.
Having taken the decision to go ahead with construction of the $400m project during a downturn in the zinc market, Vedanta is now bringing Gamsberg on line at a time when soaring zinc prices mean the mine is looking at profit margins of more than 100%.
Vedanta has three projects in the pipeline which could push zinc output from the region to one million tonnes a year – including the existing Black Mountain mine and the nearby Skorpion mine in Namibia which Vedanta also owns – of which the most important is a potential zinc refinery and smelter at Gamsberg which would cost $700m to $800m.