Vedanta will not reapply for refinery expansion

London-based Vedanta Group said it was not going to apply afresh for 'green' clearance to expand its aluminium refinery project in Orissa's Kalahandi district, even after being advised by the Union environment and forests (MoEF) ministry to do so.

The linked bauxite mining project there was disallowed by the ministry last year, after a damaging report by the NC Saxena committee appointed by it.

The committee had found several illegalities with the refinery project at Lanjigarh, too. It had said Vedanta was in illegal possession of 26 hectares of forest land and was in expansion mode even before any sort of clearance from the ministry.

Accordingly, the ministry had scrapped the proposal for six-fold expansion of the refinery, from a million tonnes per annum to six mt.

The ministry of environment and forests has now asked Vedanta to re-apply for expansion of the refinery, while it maintains a firm No against mining the Niyamgiri Hills for bauxite.

High level sources in Vedanta said the company would not file again. "Fresh applications are filed for a greenfield (new) project. This is an expansion project. About 60 per cent work is already complete. We will not make any fresh applications. We will also not drop the court challenge, and pursue it," a company official said.

A petition by Vedanta ALuminium challenging the Centre's decision is currently before the Orissa high court. The next hearing in the case is on February 2.

Early this week, Vedanta chairman Anil Aggarwal had a meeting with environment minister Jairam Ramesh.

Sources say the minister showed he was willing to review the Lanjigarh project on a fresh application. The minister could not be spoken to for his comments.

The turnaround in the case of Vedanta comes on the heels of the environment ministry's decision yesterday to allow the Lavasa project in Pune to procced, with penalties, though it was illegal.

The minister, who has taken some strong positions on environmental issues, has recently been seen as softening his stand, as in the Lavasa decision.