London-listed Vedanta Resources Plc, which faced oppositions in Zambia, Europe and India over its projects, seems to be taking steps to improve its image across the geographies.
A few weeks after the company settled a standoff with the Zambian Government over a joint venture, it issued a regulatory announcement to the London Stock Exchange on Thursday, saying the UK-based conglomerate respects the wish of the local people at the Niyamgiri hills in Odisha. “…Vedanta confirms it is not seeking to source bauxite from Niyamgiri bauxite deposit for its alumina refinery operations and will not do so until we have the consent of the local communities,” said the statement. The Anil Agarwal-led company added that it is working with the Odisha Government for alternative options for its long-term bauxite security.
Market observers in London told Business Line this was not a price-sensitive disclosure. “This is more of an image-improvement exercise. Vedanta got a drubbing from the media in the past couple of years, which hit its public image,” said an analyst with a global firm that tracks Vendanta. Last year, 12 village bodies had opposed the proposal to mine the Niyamgiri deposit and the Union Ministry of Forests and Environment rejected the proposal early this year.
Meanwhile, Vedanta’s 1-million-tonne refinery at Lanjigarh, Odisha, has targeted to source 30 per cent bauxite from Papua New Guinea in the current fiscal. According to people in the know, the company has begun importing bauxite from the Oceanian nation since March. The refinery, which was shut down for about six months in 2013-14 for lack of bauxite, is currently running at around 90 per cent capacity with raw materials of varied grades sourced from Chhattisgarh, Andhra Pradesh and Gujarat.
Recently, a standoff between Vendanta and Zambian authorities over a proposed 1,500 job cuts in Konkola Copper Mines (KCM), an 80:20 joint venture with a Zambian Government arm, had come to an end.
In early April, Vedanta CEO Tom Albanese met Zambian authorities. According to a KCM release, Albanes assured mineworkers of job security. The release, accessed by Business Line, quoted Albanese as saying: “It’s also critical to maintain integrity and compliance and that we are an ethical company.”
Three KCM mine workers’ unions and the management also signed a collective agreement on a supplementary allowance.