Vedanta To Start 250,000-Tonne Copper Rod Mill In Silvassa

Nearly five months after its unit in Thoothukudi, Tamil Nadu, was shut over alleged environmental violations, Vedanta Ltd. said today it will start a copper rod mill in Silvassa by the year end.

The mill—which will convert copper cathodes into rods for manufacturing various products—will have a capacity of 250,000 tonnes per annum, P Ramnath, chief executive officer of Sterlite Copper, told BloombergQuint. The company already operates two copper rod mills in Silvassa. With the new mill, our total capacity would be around 450,000 tonnes per annum, he said.

The Supreme Court had ordered Vedanta to shut its 400,000-tonne copper smelter in Thoothukudi following deadly protests in the region due to environmental and health concerns. Allegations of pollution dogged the smelter, which fueled an over three month-long protest by residents. The protests took a fatal turn on May 28, resulting in a police shooting in which 11 persons were killed.

The company filed an appeal before the National Green Tribunal challenging the rejection of its renewal of consent to operate by Tamil Nadu Pollution Control Board and sealing of the existing plant. Ramnath said hearings are going on with an NGT committee and there will be clarity on future course of action once it submits its report by November.

“We don't have any capex plans as of now, our energies are focused on restarting the existing plant,” said Ramnath. We had an expansion plan, but we have stopped the expansion plan, he said. “Our new copper rod plant is expected to start by December. That's our latest capex plan.”

Ramnath said with Sterlite Copper—a subsidiary of Vedanta—shut since March, the Silvassa copper mills will have to depend on imports. “We have some stocks available... We're also getting imports from our plant in Zambia.”

The demand for copper in India—which according to Ramnath is 650,000 tonnes per annum—would double in the next few years, he said. “A lot of this demand is from the wire and cable industry because lot of construction activity is going on.” He predicted that demand will come from the renewables sector and electric vehicles, among others in the future.

“Due to the closure of the copper smelter, imports increased in the first quarter of this fiscal,” said Ramnath. “This is widening our current account deficit which has already put the rupee under huge pressure.”