16th Nov 2006 07:03
Vedanta Resources PLC16 November 2006 16 November 2006 Vedanta Resources plc Enters Commercial Energy Business The Board of Vedanta Resources plc ("Vedanta") has approved a project to enterinto the commercial energy business in India. The first phase of this projectinvolves the setting up a 2400 MW green field power plant in Jharsuguda, Orissaat a total cost of $1.9 billion. The power business will be operated throughSterlite Energy Limited (SEL"), a wholly owned subsidiary of Sterlite IndustriesIndia Limited. Demand for power in India to support its growing economy has in recent yearsexceeded supply. Per capita consumption of power in India, despite havingincreased significantly in recent years, continues to lag behind powerconsumption in other leading developed and emerging economies by a large margin.To sustain the strong recent economic growth in India, the Ministry of Power inIndia has set an ambitious target of providing "Power for All" with a target ofachieving an installed capacity of 212,000 MW by 2012 by adding approximately100,000 MW of generation capacity. India has large thermal coal resources, andthe coal industry is in a process of government deregulation that is expected toincrease the availability of coal. We believe these factors make the powergeneration business an attractive growth opportunity in India and that, byleveraging our project execution and operating skills in building and operatingcaptive power plants, Sterlite may compete successfully in this business. The Group proposes to set up a 4x600 MW coal based thermal power plant atJharsuguda, Orissa. SEL has commenced construction of the first phase of theproject. It will comprise 4 units of 600 MW each. The second phase of theproject, which has not yet been approved by the Board of Vedanta, is for 1200 MWcomprising 2 units of 600 MW each. The power generated will be sold to the StateElectricity Boards and power trading companies. It would require approximately13 million tpa of coal to run the 2400 MW power plant, which would be obtainedfrom coal blocks to be alloted. The total investment is based on the green-field nature of the project and isestimated at US$1.9 billion, to be phased over 4 years. This investment includesboiler and generating unit common facilities like coal handling systems, watertreatment plant, cooling water systems, instrumentation, control tower and allnecessary infrastructure including railway networks, water pipelines and atownship for employees. The investment will be funded through a combination ofinternal resources and external financing. For further information, please contact: Sumanth Cidambi [email protected] Director - Investor Relations Tel: +44 20 7659 4732 / +91 22 5646 1531Vedanta Resources plc James Murgatroyd Robin WalkerFinsbury Tel: +44 20 7251 3801 About Vedanta Resources plcVedanta Resources plc is a London listed diversified metals and mining group.Its principal operations are located throughout India, with further operationsin Zambia, Australia and Armenia. The major metals produced are Aluminium,copper, zinc, lead and gold. For further information, please visitwww.vedantaresources.com. About Sterlite Industries India LimitedSterlite Industries (India) Limited, a majority subsidiary of Vedanta Resourcesplc, is one of India's leading diversified Metals and Mining companies withinterests and operations in aluminium, copper and zinc and lead. The company'smain operating subsidiaries are Hindustan Zinc Limited for its zinc and leadoperations; Copper Mines of Tasmania Pty Limited for its copper operations inAustralia; and Bharat Aluminium Company Limited for its aluminium operations.The company operates its copper operations in India itself. DisclaimerThis press release contains "forward-looking statements" - that is, statementsrelated to future, not past, events. In this context, forward-looking statementsoften address our expected future business and financial performance, and oftencontain words such as "expects," "anticipates," "intends," "plans," "believes,""seeks," or "will." Forward-looking statements by their nature address mattersthat are, to different degrees, uncertain. For us, uncertainties arise from thebehaviour of financial and metals markets including the London Metal Exchange,fluctuations in interest and or exchange rates and metal prices; from futureintegration of acquired businesses; and from numerous other matters of national,regional and global scale, including those of a political, economic, business,competitive or regulatory nature. These uncertainties may cause our actualfuture results to be materially different that those expressed in ourforward-looking statements. We do not undertake to update our forward-lookingstatements. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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