Tagged: Vedanta
ONGC says to issue view on Cairn’s India sale
Reuters | Oct 8, 2010 | 7:18pm IST
Oil and Natural Gas Corp said it would issue its response to Cairn Energy’s plans to sell a controlling stake in its Indian unit to Vedanta Resources "very soon.” The company is also in talks with the Indian government about the royalties it must pay on the fields it co-owns with Cairn India, and hopes that it will find an outcome, which limits its liability — potentially at the expense of Cairn or Vedanta.
"We have been raising that issue… we are in discussions with the Petroleum Ministry and the Finance Ministry," said Chairman R.S. Sharma. "I’m very positive that we will be able to get a solution to our satisfaction." Following an exemption offered some years ago to encourage companies to explore in India; Cairn is not liable for royalties, while ONGC must pay royalties on the oil blocks.
Vedanta delays aluminium growth, zinc output jumps
Reuters | Oct 7, 2010 | 3:24pm IST
India-focused miner Vedanta, which posted mixed second quarter output data, has postponed expansion of aluminium operations after India rejected a plan to mine the raw material to make the metal. In August, India denied London-listed Vedanta a permit to mine bauxite in Orissa over environmental concerns. "Since final clearance was not granted for bauxite mining at Niyamgiri, we have reviewed our capital expenditure programme," Vedanta said in its quarterly production report.
The impact on capex was tentatively estimated at $1.5 million to $2.0 billion over the next two years, chief executive Mahendra Mehta told a conference call. The launch of the second phase at the Jharsuguda smelter and a new Korba smelter were being temporarily deferred as well as work on an expansion of its bauxite refinery.
In September, the environment ministry said it had found serious violations at Vedanta’s refinery that uses bauxite to make alumina, an intermediate product. Vedanta, which is continuing to operate the plant at a production rate of 1 million tonnes per year, had planned to expand the refinery’s annual output to 6 million tonnes.
Vedanta shares rose 0.6 percent to 2237 pence by 0906 GMT, compared to a 0.4 percent fall in the British mining index. The shares have underperformed the mining index by 23 percent this year as the group has been hit with setbacks. "On balance (the news) is negative, but most of this bad news was already known to the market and the expansion cuts should come as no surprise," said analyst Andy Davidson at Numis Securities in London.
Vedanta replies to show-cause notices; denies violating norms
PTI | Sep 15, 3010 | 09:43 PM
As the fate of its USD 1.7 billion bauxite-mining unit proposed in Orissa hangs in balance, Vedanta Resources today denied violating any laws in connection with the project while replying to the show-cause notices served by the environment ministry. "Vedanta Aluminium Ltd has submitted its reply along with supporting documents to both the show cause notices issued by the ministry on August 31," said Mukesh Kumar, chief operating officer (Lanjigarh) of the firm.
"Once again Vedanta would like to reiterate that no violation has been done by it on any account and Vedanta is a law abiding company and have high respect for the law of the land," he said in a statement here. However, officials in the environment ministry maintained that they were yet to receive the reply from the company.
The ministry had served the show-cause notices on the company based on a report submitted by the NC Saxena panel, which had accused the company of violating a host of regulations at the site. The UK-based Vedanta Resources has been
India’s Government Paper Proposes Weakening FDI Rules
Article first published as India’s Government Paper Proposes Weakening FDI Rules on Technorati.
The Commerce and Industry Ministry on Friday, released proposals for discussion on whether to abolish foreign investment caps imposed on the companies invested in joint ventures in India prior to the year 2005. The discussion paper released is said to be a part of series of papers released by the ministry as a measure to attract more FDIs. Such papers also inform foreign investors how the Government of India is changing over time the policies and priorities.
Before 2005, there was a rule for the companies who tied up with Indian partners in joint ventures to seek approval from the federal government before bidding for expansion outside the tie-up. The problem is that the policy was reviewed in 2005 after which the rule exempted the companies that invested after 2005 from seeking approval for further expansion of their own. This is clearly observed as discrimination between the companies entered India before and after 2005.
Vedanta’s Acquisition Bid
Maybe the recent bid by Vedanta Resources to acquire Cairn India, a subsidiary of the U.K. based Cairn, prompted the ministry to release the discussion paper. It is a common practice in India that when the government intends a policy review, it would first release discussion papers to identify the opposition so that it can calm them properly. Cairn India has a tie-up with ONGC, a public sector oil exploration company, in its biggest oil well in Rajasthan State. Cairn India holds 70% stake and ONGC the rest in it.
India focused Vedanta Resources made a highest bid for Cairn India of $9.6 billion and sought the government’s approval which is still pending. When the matter came to light there were huge expectations that the ONGC might
BJD, Congress hold rallies over Vedanta, POSCO
MSN | IANS | 04/09/2010
Politics over mega projects by South Korean steel major POSCO and Vedanta and others intensified further with the ruling Biju Janata Dal (BJD) and opposition Congress in Orissa trading charges against each other Friday. The youth wings of the BJD organized a massive rally christened ‘Save Orissa’ near the Niyamgiri hills in Kalahandi district. Participating in the rally, party leaders accused the central government of blocking various projects in the state for political interest. Large number of senior party leaders including ministers, members of parliament, and legislators were seen at the meeting, although Chief Minister Naveen Patnaik preferred to stay away.
‘The central government led by the Congress has hatched a conspiracy to block various developmental and industrial projects in the state. The Congress is shedding crocodile tears for tribals,’ state Finance Minister Prafulla Ghadai said. ‘The BJD government has been working sincerely for the welfare of the tribals. Only the BJD can protect the interest of the tribals, backwards and Scheduled Castes people. It is evident from various welfare measures that the government has taken in the past,’ he said.
Farmers’ protest in Delhi underscores India’s land woes
Reuters | Aug 26, 2010 | 3:28pm IST
In New Delhi, about 15,000 flag-waving, slogan-shouting farmers squatted at a square near parliament after where police stopped them. Traffic in central Delhi remained gridlocked for hours. “Why is the government putting pressure on us to vacate our land? Land is our mother, We will die but not give our land,” said Vinod, a protesting farmer who gave only one name. These protests are the latest in a string of violence over government efforts to acquire farmland for industry in India, where two-thirds of the 1.2 billion population is dependent on agriculture and where land is a farmer’s only social security.
STALLED MEGA-PROJECTS
Farmers’ protests have put on hold 230 tax-free export zones and multi-billion investments by ArcelorMittal, South Korea’s POSCO and Tata Steel, according to government figures. Protests over mining on tribal land in Orissa led this week to the government scrapping plans of UK-based Continue reading
India rejects Vedanta mine plans for Orissa
BBC News | 24 August 2010 | 06:54 GMT
India’s environment ministry has refused permission for the UK mining group Vedanta to extract bauxite in the eastern Indian state of Orissa. Laast week, a report commissioned by the ministry said allowing mining in the area would deprive two ancient tribes of their rights. Vedanta’s plans to extract bauxite from a hill revered by a tribal community have caused controversy.Vedanta has said it will abide by the government’s decision.
Sacred
A four-member panel, which investigated alleged violations of environmental laws by Vedanta in Orissa’s Kalahandi district, gave its report to the ministry last week. It said that allowing mining in the area would deprive two tribal groups – the Kutia and Dongria Kondh – of their rights over the site for the benefit of a private company. It said that would “shake the faith” of tribal people in the laws of the land. The report concluded that the mine would destroy some 7 sq km (2.7 sq miles) of forest land and threaten the tribe’s survival.The Dongria Kondh say the mining project will destroy a major part of the Niyamgiri hill, which they consider sacred and a source of livelihood. Continue reading
Cairn India discovers oil and gas in KG basin
livemint.com | Aug 23 2010 | 5:20 PM IST
Cairn India, in which London-based Vedanta Resources is looking to pick up a majority stake, has discovered oil and gas in an onshore block in the Krishna Godavari basin, the company said on Monday. The company has informed Indian regulator directorate general of hydrocarbons (DGH) about the discovery, Cairn India said in a statement. The discovery was made at the Nagayalanka-1z well in the KG-ONN-2003/1 block, which is operated by Cairn with a 49 percent participating interest. State-run explorer Oil and Natural Gas Corp holds the remaining 51 percent.
A flow of 75 barrels per day of oil and 0.27 million cubic feet per day of gas was achieved at the well, Cairn said. The well is being evaluated to assess the commercial potential of the discovery, the company said. On 16 August, Vedanta Resources said it would spend up to $9.6 billion to buy a majority stake in Cairn India, the Indian unit of the UK’s Cairn Energy. In August 2009, Cairn India began pumping crude from its block in the Mangala oil field in the western Indian state of Rajasthan, the first major crude oil discovery in the energy-hungry nation in two decades. The firm holds a 70% stake in the Rajasthan oil block, called RJ-ON-90/1, while ONGC holds the balance. Continue reading
Cairn deal may not get ministry nod
Livemint.com | Aug 23 2010 | 12:19 AM IST
Vedanta Resources Plc’s proposed acquisition of a majority stake in Cairn India Ltd for as much as $9.6 billion (Rs44,736 crore) may be scuppered by the ministry of petroleum and natural gas, which wants the oil explorer to offer state-owned Oil and Natural Gas Corp. Ltd (ONGC) a chance to buy the stake. ONGC is a partner with Cairn India in the joint venture that runs the latter’s main oil asset in the country. Cairn is the operator of block RJ-ON-90/1 in Rajasthan while ONGC is the licensee and a partner in the field with a 30% stake. “The deal may not go through. They will have to give a choice to ONGC,” said a top official of the petroleum ministry, who did not want to be identified. “We are trying to find out the real worth of the assets. It will take some time. Cairn is applying to us for approval.”
Vedanta, the London-listed miner controlled by billionaire Anil Agarwal, has proposed to acquire 60% stake in Cairn India, paying Rs.405 per share to the explorer’s UK-based parent Cairn Energy Plc, including a non-compete fee, and 20% in an open offer to shareholders at Rs. 355 a piece. The deal has already been clouded by regulatory concerns raised by the petroleum ministry, tax implications and reservations expressed by Life Insurance Corp. of India (LIC), which owns a 2.57% stake in Cairn India, and analysts that the offer was unfair to shareholders. An LIC official, who spoke on condition of anonymity, said the state-owned insurer may not tender its shares in the open offer, Mint reported on 19 August. Under existing guidelines, non-compete fees do not get added to the open offer price that Vedanta will have to pay. Vedanta has already published an advertisement making an open offer to the minority shareholders of Cairn India as part of the takeover exercise. Continue reading
Vedanta posts record EBITDA of $794 mln for Q1
Reuters
| Fri Jul 30, 2010 | 12:49pm IST
India-focused mining group Vedanta Resources Plc posted record first-quarter EBITDA of $794 million in the three months to end June as production of its three most profitable metals rose. Production of saleable iron ore, its most profitable product in the quarter, jumped 31 percent from the year-earlier quarter to 6.4 million tonnes. However, output fell from the record 7.8 million tonnes in the fourth quarter.The London-listed miner said production of refined zinc, its second most profitable metal, rose 19 percent to 165,000 tonnes. Aluminium output grew 13 percent to 141,000 tonnes. At full-year results in May, the diversified miner said it was on track to deliver a substantial increase inproduction capacity across its businesses in 2011. Vedanta defended its human rights record on Wednesday at a shareholders’ meeting where some fund managers joined pressure groups to protest over its plans to build a bauxite mine in an area sacred to indigenous people
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Deadliest Maoist Raid Highlights Mittal, Posco India Challenge
Bloomberg | April 7, 2010 | 05:01 EDT
The deadliest attack on Indian security forces in four decades of left-wing conflict underscores the challenge companies including ArcelorMittal, Posco and NMDC Ltd. face in investing in mineral-rich states. Maoist rebels killed 76 officers in an ambush yesterday in the eastern state of Chhattisgarh, where NMDC operates its biggest iron-ore mine. In neighboring states, ArcelorMittal, the world’s biggest steelmaker, and South Korea’s Posco have yet to start their $32 billion projects because of protests over land. Resistance from property owners, some backed by Maoist or Naxalite rebels, and delays in approvals for land and mines have stalled more than $80 billion of projects in India that would double national steel output. Yesterday’s attacks are a setback to India’s efforts to rid the eastern states of left-wing guerillas and open up regions rich in iron ore, coal, bauxite and manganese to investment.
“If the global players had got a footprint in India they could have really made a good return on their investment,” said Abhisar Jain, metals and mining analyst with ICICI Securities Ltd. in Mumbai. “India as a whole will stand to lose if no global player is able to put up its plant here.” The Naxalite rebels, named after the 1967 peasant uprising in the West Bengal village of Naxalbari, have waged a violent campaign against the government, police and landowners for more than four decades to install communist rule. It was greeted as “a peal of spring thunder” by China’s People Daily at its birth during the political purges of Mao Zedong’s Cultural Revolution.
High Risk
“Most of the mining assets in India are present in the Maoists belt, which is a threat as more mining can’t take place and new leases can’t be executed,” Santha Sheela Nair, secretary at the mines ministry, said in a March 5 interview. ArcelorMittal, which aimed to build two mills, one each in Jharkhand and Orissa states,
India refinery ‘threatens health of local community’
BBC NEWS | 2010/02/09 | 08:06:24 GMT
An alumina refinery in east India run by a UK-based firm is causing pollution that threatens the health of local people, a human rights group says. Amnesty International said those living near the Lanjigarh refinery in Orissa breathed polluted air and were afraid to drink from or bathe in local rivers. It called on Vedanta Resources not to expand the refinery or mine for bauxite nearby before resolving the problems. Vedanta has consistently rejected the allegations against it. It points out that India’s Supreme Court has approved its initial plans. The firm has previously argued it has support from the state authorities. But it did not respond immediately when asked for the comment by the BBC on the Amnesty report. On Friday, the Church of England said it had sold its £2.5m stake in Vedanta. The Church said it was not satisfied the firm had shown “the level of respect for human rights and local communities that we expect”. Vedanta said it was disappointed by the Church’s decision and remained “fully committed to pursuing its investments in a responsible manner, respecting the environment and human rights”.
‘Blisters’
In a report published on Tuesday, Amnesty International said the Orissa State Pollution Control Board (OSPCB) had documented widespread water and air pollution caused by the Lanjigarh refinery since it opened in 2006, but failed to share it with those affected. The OSPCB found the alkalinity of the Vamsadhara River downstream of the refinery had increased, and believes the seepage, leakage or discharge of highly alkaline Continue reading
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