However, the output of copper, aluminium and power business rose during the fiscal that ended on March 31, as compared to the year-ago period, Sesa Sterlite said in a filing to the BSE.
The Vedanta Group company's iron ore production dropped a steep 59 per cent during the fiscal to 0.6 million tonnes, owing to ban in its mining activities in Karnataka and Goa. In 2013-14 fiscal, it had fallen by 60 per cent.
Sesa Sterlite has already started mining in Karnataka and hopes to recommence production at its Goa facility soon as the Ministry of Environment and Forest revoked its ban.
Oil production declined largely on account of maintenance at Mangala Processing Terminal at Rajasthan, higher than expected water cut at Bhagyam in Rajasthan and suspension of gas sales at Ravva for around three months, Sesa Sterlite said.
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"Record levels of production in aluminium underpin our confidence in achieving greater operational performance and enhancing production across our well-invested and low-cost asset base, and from the start-up of new capacities," Vedanta Resources CEO Tom Albanese told PTI.
Commenting on the production data, billionaire Anil Agarwal-led firm said: "We continue to evaluate various options for restarting copper mine at Australia which is under care and maintenance."
Giving reasons for decline in refined zinc production, Sesa Sterlite said it was lower due to lower mined metal production in the first half of the year.
Shares of Sesa Sterlite closed 3.65 per cent higher at Rs 201.70 apiece on the BSE.