Govt blocks six-fold expansion of Vedanta refinery

Govt blocks six-fold expansion of Vedanta refinery

New Delhi: Environment ministry on Thursday denied permission to Britain-based Vedanta Resources for a six-fold expansion of its aluminium plant in eastern India due to environmental concerns.

The announcement was another blow for Vedanta, whose plans to mine bauxite on sacred tribal land to supply the aluminium refinery in Orissa state was rejected by the environment ministry in August.

The ministry said on its website that Vedanta, controlled by billionaire Anil Agarwal, must “maintain the status quo" at the Lanjigarh site and undertake “no further construction activity."

Vedanta was planning an 8.5-billion-dollar expansion of the aluminium complex to boost its output to six million tonnes a year from one million tonnes.

However, the Indian ministry did not carry through with a threat to scrap its approval of the existing refinery in light of alleged violations of environment standards.

The ministry said Vedanta could continue to run the refinery as long as it maintained a forested area around the plant, monitored pollution and gave a 100-million($2.2 million ) bank guarantee to the local pollution control office.