Vedanta Resources PLC
10 October 2007
Vedanta Resources plc
Production Report for the Second Quarter and
Six Months Ended 30 September 2007
• Highest ever quarterly production volumes across Aluminium, Copper
India and Zinc mining operations
• Shipment of calcined alumina from Lanjigarh commenced in the first
week of August 2007
• Chanderiya zinc smelter expansion ahead of schedule by three months
• All other expansion projects progressing on schedule
Production volumes for aluminium, zinc and copper during the six months ended
30 September 2007 ('H1') were significantly higher compared with the
corresponding prior period. The increase in production was primarily due to the
full production from the new Korba smelter, the ramp up of the Tuticorin
smelter, stabilisation of the Chanderiya smelter and the positive impact of the
various initiatives taken at the Konkola operations.
The first stream of the Lanjigarh alumina refinery was commissioned and produced
28,000 tonnes of calcined alumina during the quarter ended 30 September 2007
('Q2'). The second stream of the refinery is currently in the pre-commissioning
The 170,000 tpa zinc hydro smelter expansion at Chanderiya is ahead of schedule
by three months and is now expected to be commissioned by December 2007. The
other expansion projects are all progressing well and are on track for
completion on schedule.
Aluminium production in Q2 was 99,000 tonnes, an increase of 25% compared with
the corresponding prior quarter, and higher than the rated production capacity.
Operating performance at both the Korba smelters has continued to improve as a
result of ongoing initiatives.
The first stream of the 1.0-1.4 mtpa alumina refinery at Lanjigarh was
successfully commissioned with production of 28,000 tonnes of calcined alumina
during Q2. The refinery started dispatching alumina to BALCO in early
August 2007. The second stream of the refinery is on course for commissioning by
December 2007. Both streams I and II of the Lanjigarh alumina refinery are
expected to be fully stabilised by the end of FY 2008.
With regard to the environmental clearances for developing the Lanjigarh bauxite
mines, the Ministry of Environment and Forests has given a positive
recommendation to the Honourable Supreme Court of India. We are hopeful of a
positive resolution of this matter soon.
Work on the first phase of the 500,000 tpa aluminium smelter and associated
captive power plant at Jharsuguda, Orissa is progressing well. Construction
activity at the site is in full swing. Equipment deliveries are progressing as
per schedule and the plant erection work has commenced. Phase 1 of this project
comprising a 250,000 tpa smelter and the associated captive power plant are on
track for commissioning by mid-CY2009.
Copper - India and Australia
The Tuticorin smelter had its highest ever quarterly production of copper
cathode of 91,000 tonnes, an increase of 14% over the corresponding prior
quarter. Mined metal production at our Australian mines was consistent, with an
output of 8,000 tonnes in Q2.
Copper - Zambia
KCM produced 40,000 tonnes of copper cathode in Q2, an increase of 29% over the
corresponding prior quarter. The production from the tailing leach plant was
substantially higher at 18,000 tonnes during Q2, an increase of 80% compared
with 10,000 tonnes in the corresponding prior quarter. As a result of the
consistent improvement initiatives undertaken, mined metal production in Q2 was
Work on the Konkola Deeps mine expansion project is progressing well with the
sinking of the main hoisting shaft and other auxiliary shafts on schedule. Work
at the Nchanga smelter expansion project remains on track with major equipment
delivered on site and erection activities progressing as per schedule. Both the
projects are on course for commissioning as per schedule.
Mined metal production was at its highest ever at 143,000 tonnes during Q2, an
increase of 15% compared with the corresponding prior quarter. Refined zinc
production was 94,000 tonnes in Q2, an increase of 21% compared with the
corresponding prior quarter.
Sales in Q2 were augmented by the sale of 85,000 dry metric tonnes of zinc
concentrate and 10,000 dry metric tonnes of lead concentrate.
Work on the new 170,000 tpa Chanderiya hydro smelter is in the final stages of
completion with commissioning expected by December 2007, about three months
ahead of our earlier announced commissioning schedule of early 2008. The 88,000
tonnes debottlenecking project is also progressing well and is on schedule.
As part of our green energy initiative, we have successfully commissioned
63.2 MW as of September 2007, out of the total contracted 148.8 MW of wind power
plants. Work on the remaining plants is on schedule with progressive
commissioning expected by March 2008.
The open offer to acquire an additional 20% of Sesa Goa Limited ('Sesa') closed
on 19 September 2007. Post completion of this offer, our holding in Sesa was a
little over 51%.
The saleable ore produced in Q2 was 1.85 million tonnes. Overall production and
consequent shipment is generally lower during this period, due to the seasonal
monsoon cycle, which is typical to the region.
Work on the 2,400 MW (4x600 MW) coal based independent thermal power plant is
progressing well. The EPC contract has been placed and engineering and
procurement activities are on track. The project is on schedule for progressive
commissioning in late CY 2009 as announced previously.
Production Summary (Unaudited)
(In '000 tonnes, except as stated)
Six months ended 30 September Second quarter ended 30 September
2007 2006 Change % 2007 2006 Change %
Korba/Mettur 145 150 (3.3%) 74 77 (3.9%)
Lanjigarh 28 - - 28 - -
Aluminium 196 155 26.5% 99 79 25.3%
content 15 15 - 8 7 14.3%
Cathodes 172 137 25.5% 91 80 13.8%
Rods 107 87 23.0% 56 46 21.7%
content 41 43 (4.7%) 21 25 (16.0%)
Cathodes 79 70 12.9% 40 31 29.0%
content 278 256 8.6% 143 124 15.3%
Refined metal 187 161 16.1% 94 78 20.5%
Saleable ore3 3,782 - - 1,848 - -
1. Represents production for the current quarter only and is not directly
comparable with the corresponding prior periods
2. Represents production in post acquisition period of 5 months to 30 September
2007, and are not directly comparable with the corresponding prior periods
3. Saleable ore is reported on wet tonnes basis
For further information, please contact:
Sumanth Cidambi email@example.com
Associate Director - Investor Relations Tel: +44 20 7659 4732 /
Vedanta Resources plc +91 22 6646 1531
James Murgatroyd Tel: +44 20 7251 3801
About Vedanta Resources plc
Vedanta Resources plc is a London listed FTSE 100 diversified metals and mining
group. Its principal operations are located throughout India, with further
operations in Zambia and Australia. The major metals produced are aluminium,
copper, zinc, lead and iron ore. For further information, please visit
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