Vedanta Resources PLC
31 May 2005
31 May 2005
Vedanta Resources plc
Completion of Major Zinc Expansion Project
& Extension of Mine Life
Vedanta Resources plc, the London listed metals and mining company, announces
that the major expansion project at its zinc facilities in India has been
completed on schedule and trial production has commenced. The cost of the
project is around 15% less than the original budget of $425m and the smelter was
completed at a cost significantly below international benchmarks.
The expansion increases Vedanta's refined zinc capacity by 170,000 tpa to around
400,000 tpa. The new hydro metallurgical smelter, designed by Lurgi, has the
latest energy and environmental efficiencies and will further improve Vedanta's
already globally competitive cost position. The project included the
construction of a 154 MW captive power plant and the expansion of mine output
from 2.3 mtpa to 3.75 mtpa.
Separately, the reserves at the Rampura Agucha mine, which feeds the smelter,
have been increased by 25%, compared to the reserves at 31 March 2004, to 50.1
million tonnes. This follows a drilling programme by Vedanta's Exploration
Division, which started in September 2004. The reserves contain 12.8 % zinc and
1.9% lead. The life of Rampura Agucha has therefore been extended by another 3
years, at the increased level of output, with potential to expand the reserves
through further exploration.
The programme to upgrade reserves and resources will continue at Rampura Agucha
throughout 2005-06 including further brownfield exploration for zinc around the
existing mines in Rajasthan.
Anil Agarwal, Chairman of Vedanta said 'We are delighted at the success of this
second major project which, through the dedication and expertise of my
colleagues, demonstrates our ability to deliver projects at low cost and on
schedule. The increase in reserves adds significant long term value to Vedanta
and is part of a focused exploration effort. Zinc demand in India is growing
rapidly and the new production will be well placed to serve this demand and
assist in the future economic growth of India.'
For further information, please contact:
Peter Sydney-Smith, Finance Director
John Smelt, Head of Investor Relations Tel: +44 20 7499 5900
Vedanta Resources plc +44 787 964 2675
Robin Walker Tel: +44 20 7251 3801
Notes to Editors:
Vedanta is a London listed diversified metals and mining group. Our principal
operations are located throughout India, with further operations in Zambia and
Australia. The major metals produced are aluminium, copper, zinc and lead. The
zinc facilities are principally based in Rajasthan, in North West India, and are
operated by Hindustan Zinc Limited, which is 65% owned by the Vedanta group. The
expansion project involved constructing a 170,000 tpa hydro-metallurgical
smelter with a 154 MW coal based thermal captive power plant and expanding the
capacity of the Rampura Agucha operation from 2.3 Mtpa to 3.75 Mtpa.
A drilling programme aimed at upgrading resources to reserve status and further
adding to resources was commenced by the Exploration Division in the last
quarter of 2004. This programme focused on drilling down dip and along strike of
the already outlined reserves. An independent audit of the reserves and
resources at 31st March, 2005 has been carried out by SRK Consulting.
The reserves and resources for Rampura Agucha at 31st March, 2005 are:
Ore Reserve JORC Classification Tonnes (millions)Zn% Pb%
Proved 22.4 13.2 2.0
Probable 27.8 12.4 1.9
Total 50.1 12.8 1.9
Mineral Resource Measured - - -
Indicated 11.1 12.7 1.7
Inferred 13.8 12.2 1.7
Total 24.9 12.4 1.7
Note: Resources are in addition to reserves.
There are no measured resources in addition to the reserves as these have all
been upgraded to reserve status.
The information on Mineral Resources and Ore Reserves in this press release is
based on information compiled internally by the mining division of Rampura
Agucha Zinc Mine and independently audited by Mr Steffen Schmidt and Mr David
Pearce of SRK(UK) Ltd. Mr Schmidt is a Senior Mining Geologist whilst Mr Pearce
is a Principal Mining Engineer, both with SRK Consulting. Mr Schmidt has
sufficient experience in this style of mineralization and resource estimation
techniques whilst Mr Pearce has sufficient experience with the mining methods
and reserve estimation techniques to be regarded as 'competent persons' as
defined in the 2004 edition of the 'Australasian Code for Reporting of
Exploration Results and Mineral Resources and Ore Reserves' (The JORC Code). SRK
Consulting consents to the inclusion of the material in the form and content in
which it appears.
This information is provided by RNS
The company news service from the London Stock Exchange