Vedanta expansion plan hits green block

The environment ministry on Thursday cancelled the initial approval given for Vedanta Resources’ $5.8 billion expansion plan citing environmental violations.

The environment ministry on Thursday cancelled the initial approval given for Vedanta Resources’ $5.8 billion expansion plan citing environmental violations.

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The London-based metal giant had planned a six-fold expansion of its aluminum refinery in Lanjigarh in Orissa’s Kalahandi district from the existing output of one million tonnes a year and increase capacity of its captive power plant. In August, the ministry rejected environment clearance to Orissa Mining Corporation for bauxite mining for the company in Nyamgiri Hills, home of primitive tribal groups Dongriya and Kuntia Kondhs.

HT had reported on October 15 that approval to the company’s expansion plans would be scrapped. In a communication to the company on Wednesday, the ministry cancelled the initial approval given in August 2009 and scrapped all actions taken thereafter, warning that the company maintain status quo at the refinery site.

The NC Saxena committee, which probed the alleged violations, had said Vedanta started construction for expanding the factory without the ministry’s approval. The company had told the ministry that the approval was not required.

This means the company can continue operations in the refinery, if it meets environment norms, but cannot expand it. “The company can continue to operate its existing 1 million tonne a year refinery, provided it maintains a minimum level of forested area around the plant,” the ministry letter said. The company has also been asked to deposit R2 crore with the state pollution control board.