L&T, Dubal to set up refinery

Engineering and construction major Larsen & Toubro has entered into an understanding with Dubai Aluminium Company Limited to set up an integrated bauxite mining-cum-alumina refinery project for Rs 5,000 crore (Rs 50 billion) in Orissa.

L&T's chairman and managing director A M Naik said the deal would provide the company 's engineering and construction division an opportunity to execute a project valued at over Rs 3,000 crore (Rs 30 billion). The refinery is expected to be commissioned in 2009.

The project involves setting up a 1.4 million tonnes alumina refinery, bauxite mine and associated infrastructure, including a captive power plant, port facility, township and other utilities.

In the second phase, the capacity will be doubled to 2.8 million tonnes by setting up an aluminium smelter using Dubal's own technology.  L&T already has development rights to bauxite deposits and prospecting in Orissa.

Naik said the proposed joint venture with Dubal was in line with L&T's objective of setting up large projects in alliance with world leaders, and reflected the company's desire to increase business with the UAE. L&T is already engaged in setting up the Dhamra Port in Orissa.

L&T's Executive Vice-President A K Chhatwani, who signed the understanding with Dubal's chief executive officer, Abdulla Kalban, said the total project would cost around Rs 5,000 crore and would have the potential to expand in phases.

Plant plan

The deal: To set up an integrated bauxite mining-cum-alumina refinery project for Rs 5,000 crore in Orissa

Stage I
Setting up a 1.4 million tonnes alumina refinery, bauxite mine and associated infrastructure

Stage II
The capacity will be doubled, which envisages the setting up of an aluminium smelter