Vedanta Group’sHindustan Zinc Ltd (HZL) is on its way to becoming a fully underground mining company by early next financial year even as it expands its zinc production capacity to 1.2 million tonne (mt) from the current level of nearly 1 mt.
The company plans to convert its Rampur Agucha block, which contributes 75 per cent of its output, to under-ground mine by shutting all open cast operations.
“HZL is on its way towards transition to a fully underground mining company with next generation of technology. This transition will be completed either by the end of current financial year or maximum by early next year,” Hindustan Zinc CEO Sunil Duggal said.
Stressing that production at open cast mine is easier than at underground mine, Duggal said initially the company is expecting production levels to be slightly challenging at Rampura Agucha in Rajasthan.
“But since we are ramping up all other mines, we are well placed to meet the requirements of our smelters and also our production levels. Gradually the production level at Rampura Agucha under-ground mine will pick up and will further support our expansion plans,” he said.
Duggal said the company has already expedited capacity expansion at other mines to ensure that the overall mine production is not impacted. The country’s largest integrated zinc producer will be expanding production capacity of all its mines by 2019-20 to meet the growing demand.
In 2016-17, Rampura Agucha mine produced 3.3 million ton ore from open-cast operations and 1.4 million ton ore from under-ground operations. The company said the production at Rajpura Dariba mine is being expanded to 1.5 million ton from the current capacity of 0.9 million ton.
The silver rich Sindesar Khurd mine is being expanded from the current capacity of 4 mt to 6 mt.
Zawar mine is all set to reach the capacity of 2.5 mt from 1.8 mt in the current financial year and subsequently to 4.5 mt in the next three years.
The company’s Kayad mine in Ajmer has ore production capacity of 1 mt and efforts are being made to expand this mine as well.
“Though ore production capacity of all the mines put together is 12.20 mtpa, the actual ore production in the year 2016-17 was 11.87 mt. The company is aiming to expand the mine production levels to 13.10 mtpa in the current financial year and reaching to 17.50 mtpa in the next three years, i.e. by FY 2020,” Duggal said.
Since disinvestment in 2002, Hindustan Zinc has invested over $3 billion in four phases of expansion programmes to reach zinc production capacity of 1 mt and within three years, the company is expected to expand the metal production capacity to 1.2 mt, he said. The company will take zinc production to 1.5 mt in next five years, Duggal added.