India's fourth-largest aluminium maker, Indal, plans to sharply raise its refining and smelting capacity to boost its share in domestic and global markets, a company official said on Thursday.
Indian Aluminium Co (Indal), which currently accounts for about eight percent of India's aluminium output, plans to more than quadruple the annual capacity of its Muri alumina refinery in eastern Jharkhand state to 500,000 tonnes from 110,000 tonnes.
The company, a subsidiary of India's largest aluminium producer Hindalco Industries Ltd, plans to increase the capacity of its Hirakud aluminium smelter in the eastern state of Orissa by 54 percent to 100,000 tonnes.
It has also decided to further increase its power generation capacity at Hirakud to 267 megawatts. The current expansion to 167 MW from 67 MW will be over by May 2005.
"The company's board (of directors) approved these plans last week and we hope to complete the expansions by June 2006," the official, who declined to be identified, told Reuters.
The expansion will help Indal take advantage of aluminium prices that hit a 6-1/2 year high of $1,775 a tonne on the benchmark London Metal Exchange in mid-February, and to meet domestic demand in an economy that grew a spectacular 10.4 percent in the October-December quarter of 2003.
He said the board also approved a plan to expand Indal's Belgaum alumina refinery in the southern state of Karnataka to 650,000 tonnes a year from 340,000 tonnes, but the project will be started only if it gets new bauxite mines from the government.
"We have applied to the government for getting mining rights in neighbouring Maharashtra state," he said, adding the mining block Indal is looking at contains about 20 million tonnes of bauxite reserves.
Indal was likely to get environmental clearance soon from the Orissa government to raise the capacity of the Hirakud smelter by shifting remaining equipment from an idle unit and improving efficiency, the official said.
"We are very close to getting government approval, which is a simple administrative exercise for granting permission to existing units to expand at the same site," the official said.
Indal plans to shift 142 electrolytic pots from its Belgaum smelter to Hirakud, which will hike the capacity to about 85,000 tonnes a year from 65,000 tonnes. Another capacity addition of 15,000 tonnes would come from adding more equipment and improving the efficiency of the smelter, the official said.
Indal doubled the Hirakud smelter's capacity in 2002 to 57,200 tonnes by shifting half the 400 pots from the Belgaum plant, which was closed in 1995.
The unit had become enviable due to the high cost of power supplied by the regional government. It transferred a further 58 pots in October 2003.
The pots are used to smelt alumina, an intermediate product extracted from bauxite ore, to produce aluminium metal.
Indal produced 65,405 tonnes of aluminium and 492,375 tonnes of alumina in the year ended in March, up from 51,233 tonnes and 467,999 tonnes respectively in the previous year. It exported about 160,000 tonnes of alumina in 2003/04.
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