Sesa Sterlite has been granted a prospecting licence by the Orissa state government for two laterite deposits, which could boost the prospects of the company’s 1 million tonne/annum alumina refinery in Lanjigarh.
The company is facing losses due to the high import and transportation costs of bauxite ore from outside Orissa to feed the plant.
With the state granting two prospecting licences for laterite deposits over 47 hectares of land in Dangdeula village, the second in less than a month, company officials hope extraction of bauxite from laterite will help lower the production cost of alumina.
Orissa state director of mining Deepak Mohanty says laterites and lateritic soils contain 20 to 25% aluminium oxide. “If blended with good quality bauxite, it can be used to produce alumina.” Because laterite is a minor mineral, its extraction does not require approval from India’s mines ministry.
Another senior company official, Anil Bhat, says after the Ministry of Environment and Forests rejected Sesa’s application for mining bauxite from Niyamgiri in 2013, the company is running the plant by importing bauxite from Gujarat, Maharashtra, Madhya Pradesh and Jharkhand as well as from Papua New Guinea.
Sesa Sterlite says despite the bauxite shortage, the Lanjigarh plant has been running at 80-90% per cent of capacity.