NEW DELHI, February 23: Engineering giant Larsen & Toubro (L&T) is planning to set up a joint venture alumina project with French company Al Pechiney in Orissa. The Rs 3,500 crore project will have a production capacity of 10 lakh tonne per annum (lpta) of alumina and is likely to be implemented by 2001, sources said.L&T will shortly enter into an agreement with the French aluminium manufacturer for equity participation, sources said.
L&t had to break the earlier tie-up with Aluminium Corporation of America for the greenfield alumina project as the American company backed out in the last moment due to falling aluminium prices and depressed conditions in the global aluminium industry.
L&T is the third company in India to set up a greenfield project in Orissa. The other companies are Hindalco-promoted Aditya Aluminium and Utkal Alumina promoted by Indal.
While Aditya Aluminium is setting up a 2.4 ltpa integrated aluminium plant with captive power plant, Utkal Alumina is planning to set up 10 ltpaalumina plant with equity participation from Alcan of Canada, Tatas and Norsk Hydro.
The aluminium industry in the last few years has attracted large number of investments due to growing demand for the white metal in the country.The total investment in the Indian aluminium industry in the next five years could be around seven billion dollars, industry experts said.
Apart from the greenfield projects, existing companies are also expanding their production capacity. Hindalco, last week, increased its aluminium capacity by 32,000 tonne while Nalco increased the capacity by 1.15 ltpa to 3.45 ltpa.
The demand for the metal in the country is expected to grow at eight per cent per annum compared to three per cent worldwide. The total demand for aluminium at present is 5.80 ltpa while production is 5.29 ltpa, resulting in shortfall of 51,000 tonne of metal.
Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.
