The only copper ore producer in India, Hindustan Copper (HCL), is aiming to invest Rs 3,677 crore to expand its existing copper ore production capacity by four times to 12.41 million tonnes per annum (mtpa) by 2016-17.The company has prepared an ambitious expansion plan to expand capacity of 3.21 million tonnes to 12.41 million tonnes, which would be funded from internal resources, fresh issue of shares and debt.
Meanwhile, the company is also planning to take up greenfield projects for exploration and ore production. HCL would spend a total of Rs 297 crore next fiscal through internal sources for part-funding expansion of the Khetri, Kolihan, Banwas and Singhbhum mines and reopening of the Rakha and Kenadadih mines. HCL has already applied for prospecting leases across the country for greenfield exploration and it proposes to explore and develop these mines in a joint venture with global mining majors.
HCL's existing capacity caters to about 3 per cent of the requirement of optimum utilization of installed capacity for smelting/refining of copper in the country. HCL plans to invest a total of Rs 174 crore for expansion of the Khetri mines from 0.5 mtpa to 1 mtpa. In the Kolihan mines, it would invest Rs 275 crore for expanding the capacity to 1.5 mtpa from 0.5 mtpa now and Rs 91 crore to develop the Banwas mine with a capacity of 0.6 mtpa. The Surda mine's capacity will be expanded to 0.9 mtpa from 0.42 mtpa now at a total cost of Rs 216 crore. HCL is likely to invest Rs 347 crore to reopen the closed Rakha mine and Rs 87 crore is for enhancing the capacity of the Kendadih mines to 0.21 mtpa.
Recenlty, after delaying its follow on public offer due to adverse capital market conditions, Hindustan Copper was in talks with aluminum major Nalco to sell stake in its mines. The company is currently negotiating with Nalco and is looking to sell about 20% equity stake in two of its copper mines. Hindustan copper is looking to expand and the stake sale is aimed to part finance its expansion plans which is estimated to cost over Rs 4,000 crore.
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