Vedanta: Oil and Gas Output Rises; Mining Produce Falls

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London listed mining firm Vedanta Resources, as previously announced, has released its production results for its last quarter and the full year, ahead of a conference call to be attended by senior management at 9:00 GMT today.


Vedanta, a diversified natural resources miner with interests in silver, lead, copper, zinc, iron ore, aluminum, power, and oil and gas, saw a drop of 18% in copper production to 177,000 tonnes compared to that in 2013, due to the temporary closure of its Tuticorin smelter in India over environmental and health issues as well as the suspension of production in its Australian site caused by mud rush last January.

The miner’s oil and gas business, on the other hand, ended with a 6% increase in total production, with Vedanta’s working interest gaining 7% more compared to that of the previous fiscal year.

Vedanta has a 58.9% stake in Cairn India, with assets in India, Sri Lanka, and South Africa, including the Rajasthan block, the largest onshore oil block in the country estimated to contain 7.3 billion boe.

As expected, Vedanta’s iron ore business suffered a 60% drop in production following a ban on iron ore mining at its Karnataka site. Mining resumed only on 28 December 2013, and produced 1.5 million dry metric tonnes of saleable ore compared to 3.7 million dry metric tonnes produced during the 2013 fiscal year.

Zinc production only saw marginal increase of 1% for the full year. “Production in H2 was lower than what we had planned initially due to slower than expected ramp up of underground mining projects and changes in mining sequence, wherein preference was given to primary mine development,” Vedanta said in its report.

Vedanta operates one of the world’s largest integrated zinc-lead productions through its Hindustan Zinc Limited, a public company listed on both the Bombay Stock Exchange and the National Stock Exchange in India, as well as interests in Namibia, South Africa, and in Ireland that produce refined zinc and zinc-lead metal-in-concentrate.

Vedanta’s Aluminum production fell by 1% while its power sales dropped by 7% due to “weak market demand and evacuation constraints” at two of its power plants.

In London, Vedanta shares were down 1% to 927.50 pence at 8:51 GMT.

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