The National Aluminium Company Limited (Nalco) plans to finance its proposed Rs 6000 crore third phase expansion from internal sources.
To carry out the expansion plan, the company has appointed consultant for detail engineering of the alumina refinery and the power plant and hopes to do the same for smelter after additional land adjacent to its existing smelter and power complex at Angul is handed over to the company.
Nalco requires about 264 acres additional land near the existing smelter and power complex for the proposed third phase expansion. It has deposited the first installment of money for the land and the state owned Industrial Infrastructure Development Corporation (IDCO) has started the process of land acquisition on behalf of the company.
The third phase expansion includes the plan to raise the bauxite mining capacity to about 90 lakh tonne, alumina refining capacity to 30 lakh tonne, aluminium smelting to 6.3 lakh tonne and power generation to 1400 Mw. It will start the third phase expansion work after the completion of the Rs 5000 crore second phase of expansion by December 2008. "The third phase expansion entailing an investment of Rs 6000 crore will mainly dbe financed from internal sources. It is expected to be complete by 2012", C R Pradhan, chairman and managing director (CMD), Nalco said.
Talking to the media after the 27th Annual General Meeting (AGM) here, Pradhan said, efforts are on to set up another aluminium complex in the state. A smelter and power complex (SPC) is planned at Jharsuguda at an investment of Rs 8500 crore. SPC will have a smelter capacity of 5 lakh tonne per annum and a power plant of 1260Mw.
The Engineer's India Limited (EIL) has been appointed as consultant for the project and it has found the project technically feasible. “If the project is through, then a consultant will be appointed for preparation of the detailed project report (DPR)", he said adding that the company has made some provisions for funding this project under its five year plan.
Stating that Nalco needs another mines besides Potangi for meeting its requirement in future, Pradhan warned that if the company does not get Potangi bauxite mines, it is bound to affect the expansion plans. Though Potangi has been reserved for the company by the Union government, mining lease is yet to be issued. On the other hand, its application for Gandhamardan mines is pending with the government.
Regarding the progress of the overseas projects taken up by the company, Pradhan said, it has signed a memorandum of understanding (MoU) with the government of South Sumatra for setting up a 5 lakh tonne smelter along with a 1250Mw power plant at an investment of about Rs 14000 crore. While the land and the coal deposit have been identified, the negotiations with the Bhupatis (land owners) will start next week for acquisition of land. A Dubai based firm has been given the concession for developing the port and the rail connectivity to the project site.
He said, functioning of the Nalco’s smelter and CPP at Angul has been severely impacted due to the decline in the coal supply by the Mahanadi Coalfields Limited (MCL) over the last few years. Though it has the option of either importing coal from outside or procuring from the private coal miners in the domestic market, both are not feasible due to cost and quality factor.
Moreover, only 10 to 15 percent of the total requirement can be met through these routes. On the proposed aluminium park , B L Bagra, director (finance) said, the company hopes to sign the memorandum of understanding (MoU) with the state owned Industrial Infrastructure Development Corporation (IDCO) for setting up the aluminium park at Angul within a month.
On financial outlook of the company in the second quarter of this fiscal, Bagra said, lesser turnover and profit are expected in the second quarter. It will not be possible to maintain the last fiscal's level. The Nalco board also approved a dividend payout of 60 percent amounting to Rs 386.59 crore on the paid up equity share capital of Rs 644.31 crore.
