(Bloomberg) -- Anil Agarwal's Vedanta Ltd. is scouting for locations to set up a new copper smelter in India as its plant in the southern state of Tamil Nadu has remained shuttered for close to three years.
The Mumbai-based company is seeking expressions of interest from state governments of coastal Indian states to partner with it for setting up a 500,000 tons-a-year copper smelter complex at a potential investment of around 100 billion rupees ($1.4 billion), it said in a newspaper advertisement. The project will require about 1,000 acres (4.0469 square kilometers) of land close to a port along with logistics connectivity, it said.
Vedanta has fought multiple court battles to restart production at its 400,000 tons copper factory in Tuticorin. The plant has been closed since 2018 on orders from the state government after more than a dozen people were shot dead by the police while protesting against pollution from the facility. A fresh plea to restart the smelter is pending in India's top court.
Agarwal's move comes as copper prices rallied to a nine-year high in February on expectations of higher demand due to a global economic recovery and green initiatives. While the rally has faltered in recent weeks on rising inventories and renewed coronavirus lockdowns in Europe, the additional capacity would ease India's trade expenditure and improve supplies locally.
“India's copper requirements are set to grow exponentially in the coming years,” Vedanta said in an emailed statement. “Having ample supplies of copper is critical to ensuring successful implementation of new-gen technologies such as electric vehicles, rapid automated transport and clean energy.”
Vedanta's Tuticorin smelter closure cut India's copper output by almost half, turning the country into a net importer of the metal. In the first two years of the shutdown, refined copper imports rose more than three times to 151,964 tons in the financial year ended March 2020, while exports slumped 90% to 36,959 tons, according to a government statement.
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