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Gamsberg Expansion Risky Without Water and Power Guarantees Vedanta Zinc

Metal News - Published on Wed, 13 Nov 2019

Image Source: zincinternational
Vedanta Resources has urged the South African government to provide it with certainty on issues ranging from infrastructure development to fiscal stability for the second phase expansion of its Gamsberg zinc mine in the Northern Cape province might prove too risky to undertake. Ms Deshnee Naidoo, CEO of Vedanta Zinc International, said that "We need speedy decisions on issues like power, infrastructure and fiscal stability. Without certainty on these issues, investors will be reluctant to commit to projects that might take a long time to show a return on investment. The risk is simply too great".

Ms Naidoo said VZI is interested in reaching an agreement with the government on hybrid power supply model for the Gamsberg smelter as well as working together to ensure a market for the co-products of the zinc smelting process. She said "VZI is also seeking clarity on the availability of water in the Northern Cape and the creation of a market for the sulphuric acid which is the main by-product of the zinc refining process. Without these, the boost to the province’s economy represented by the potential Vedanta investment is unlikely to materialize."

Vedanta chairman, Anil Agarwal, earlier voiced his support for the investment targets. Vedanta has committed ZAR 21.4 billion in investment to Gamsberg phases one and two and the smelter at the first investment conference. The first phase of Gamsberg has been commissioned with full production planned for 2020.

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Posted By : Arun Huidrom on Wed, 13 Nov 2019
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