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Aditya Birla Minerals, a subsidiary of Hindalco Industries, plans to restart operations at Mt Gordon copper mine in Queensland, Australia, as the company expects substantial improvement in copper prices this fiscal.
The company had put the mine under care and maintenance after the operational cost outstripped the copper prices in 2009.
Mr D. Bhattacharya, Managing Director, Hindalco Industries, said the company is drawing up a blueprint for restarting operations at Mt Gordon and will decide on the quantum of production and other financial matrix in due course.
“We decided to restart the copper mine as we expect the recent rise in copper prices and improvement in treatment and refining charges (TcRc) to sustain at least for this fiscal to make the mining operations viable,” he said.
The average copper prices have gone up 33 per cent on the London Metal Exchange in the last one year on the back of good demand in emerging economies, especially China and India. A slew of power projects and industrial developments in India have pushed up copper demand, said an analyst.
Aditya Birla Minerals, which is a debt-free company, is also scouting for copper mines in Latin America, said Mr Bhattacharya.
Based out of Perth, Western Australia, Aditya Birla Minerals also has mining and production facility at the Birla Nifty Copper Operation in Great Sandy Desert, Western Australia.
Aditya Birla Minerals, which is 51 per cent-owned by Hindalco Industries, is one of the largest integrated producers of aluminium and copper metal from copper concentrate.
Concentrates produced at copper mines in Australia are shipped to Birla Copper, the Gujarat-based subsidiary of Hindalco. Birla Copper has a copper smelter capacity of 500,000 tonnes a year.
Besides copper cathodes and continuous cast copper rods, Birla Copper produces sulphuric and phosphoric acids, di-ammonium phosphate and other phosphatic fertilisers. The Dahej plant in Gujarat has its own power plant and jetty to meet infrastructure requirements.
Despite higher energy cost in the copper business, Hindalco has recorded a 61 per cent rise in EBIT at Rs 206 crore during the fourth quarter of last fiscal by producing more value-added products. Spot TcRc has improved in the last few months as some of the smelters in Japan were shut after the recent earthquake. Hindalco has managed to negotiate a 20 per cent increase in the TcRc for 2011 with global miners, said Mr Bhattacharya.
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