Nalco is poised to clinch a crucial deal for bauxite sourcing from Gujarat. Its negotiations with Gujarat Minerals Development Corporation (GMDC) reached the “final stage”, the CMD of Nalco, Mr B.L. Bagra, told Business Line .
The GMDC board recently approved the arrangement for sourcing through a joint venture with Nalco. The public sector unit is to set up a smelter and a 10-lakh-tonne a year alumina refinery at an estimated cost of Rs 4,600 crore in Kutch district.
The project, however, is conditional on availability of local bauxite.
GMDC will have a minority stake in the project. “But the quantum of holding is yet to be decided,” he said. On March 29, the corporation recommended the proposal to the State Government.
The State Government's final approval was expected for the agreement within a month, he added. Nalco has opened a project office in Ahmedabad.
The developments marked end of a long negotiation process after a global bidding round. Though several bidders had cleared the technical evaluation stage, Nalco was the lone contender to pass the scrutiny for the financial bids.
Regarding the quality of the ore, to be made available by GMDC, Nalco CMD said: “the grade is prima facie usable for viable production of alumina”.
Gujarat had floated tenders for an alumina project based on its bauxite reserves. Kutch has 63 million tonnes (mt) of low bauxite reserves. There are smaller estimated reserves of medium and high grade ores of around 20 mt. GMDC currently mines a little over a lakh tonne a year of relatively better grade bauxite. Vedanta Group sources a portion of bauxite for Niyamgiri plant in Orissa.