Zinc production shines in Vedanta's first quarter

Vedanta saw a number of production improvements in its first quarter, it reported on Wednesday, including an 84% rise in mined metal production at Zinc India to 233 kt, with refined zinc-lead metal production ahead 80% year-on-year at 228 kt.

The FTSE 250 company also reported refined silver production at Zinc India of 3.7m ounces in the three months to 30 June, up 30% on the same time last year.

For its Zinc International division, production fell 25% year-on-year to 32 kt, which the board put down to a planned plant shutdown at Skorpion in June.

The Gamsberg project was on track to start production in the middle of the 2018 calendar year, Vedanta claimed.

In Oil & Gas, the company posted gross average production of 187,203 barrels of oil equivalent per day for the quarter, with a “continued stable contribution” from Mangala EOR, at 56 kilobarrels of oil equivalent.

“Our Zinc and Oil & Gas businesses have delivered a strong quarter,” said chief executive Tom Albanese.

“Vedanta is a world leader in zinc, and zinc prices have strengthened since the quarter end on continued global supply deficits.

“The Gamsberg project is also developing well and remains on course to commence production in mid-CY2018.”

Production was flat quarter-on-quarter at Vedanta’s Aluminium unit, due to a previously-announced outage at Jharsuguda-I.

It reported an exit production run-rate of 1.4 megatonnes per annum, confirming its production ramp-up was currently continuing.

For Copper India, production was lower due to another planned maintenance shutdown, although the board claimed its smelter was operating “at high efficiency” following the restart.

Production improved at Copper Zambia’s Konkola Underground and Nchanga Open-pit sites, with integrated production improving 9% quarter-on-quarter.

Vedanta experienced lower iron ore sales from Goa due to the lower pricing environment, and as a result it said it was working on beneficiation and grade improvements.

Finally, in its Power division, Vedanta said the plant at its Talwandi Sabo Power Limited project in Punjab was restarted at the end of June, and was now running at availability of above 90%.

“We are working to optimise costs at Copper-Zambia while our continued ramp-up in the Aluminium business has helped us exit the quarter on a strong production run rate of 1.4 mtpa,” Tom Albanese added.

“We are realising the true benefits of Vedanta's diversified portfolio.”