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Suresh P. Iyengar

Mumbai, Nov. 14 Hit by the sharp fall in metal prices amid global economic slowdown, Vedanta Resources Plc has decided to cut its capital expenditure plans by $5.1 billion through various initiatives. The company planned to invest $14 billion in India over the next four years.

Vedanta will cut 20 per cent capex in alumina, aluminium and zinc-lead expansion projects amounting to $1.5 billion and defer investment of $2 billion in 1,980-MW captive power plant at Jharsuguda in Orissa. And, in the interim, use power from the 2,400-MW independent power projects.

It has also decided to reduce its investment commitment in the $2.1-billion Talwandi Sabo power project to $500 million from the scheduled $1.6 billion.

Mr Anil Agarwal, Chairman, Vedanta Resources plc, said, “We have reviewed our capital expenditure programme and believe that we have an opportunity to reduce announced investments by $5.1 billion through various initiatives.”

To mitigate the impact of lower selling prices, the company was targeting a further reduction in operating costs through various measures including reviewing some temporary cut down in production at some of the high cost operations, he said.

On the acquisition of US-based company Asarco, Sterlite had informed Asarco on October 13 that it cannot complete the transaction at the previous consideration of $2.6 billion due to recent financial turmoil, steep fall in copper prices and adverse global market conditions. It is waiting for response from Asarco.

More Stories on : Metals | New Projects

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