Vedanta Resources plc Annual Report & Accounts 2013

Strategy Review

Long-term Value

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Switchyard, Talwandi Sabo project.
Operating above capacity
Optimise returns

As the majority of our assets have had recent investment or are new, over the period our businesses have demonstrated lower annual sustaining capital costs. We believe there is further potential for operating cost reduction with the ramp up of production, a continued focus on asset optimisation and improved raw material sourcing.

Reserves and resources

In line with our strategy to maintain long mine life for our assets and our target to add more than we mine, we continue to focus on our exploration programmes – on both brown field and green field sites. During FY 2012–13, our exploration activities resulted in the successful addition of reserves and resources (‘R&R’) at our zinc and iron ore businesses.

Key achievements
  • 1.0mt contained metal added to R&R in Zinc India, prior to depletion of 0.9mt equivalent of mined out metal during the year
  • Significant exploration success in our Indian Iron Ore business, with the net addition of 59mt to reserve and resources, extending the mine life to 20 years
  • Exploration success in Liberia, first iron ore R&R declared at 966mt
  • Konkola Copper Mine (‘KCM’) has substantively increased its R&R by 78mt on a net basis. This increase in R&R has contributed to a 20% increase in contained copper compared to March 2012
  • Copper Mines of Australia (‘CMT’) added 5.4mt to reserves, prior to depletion of 2.5mt. With a total reserves of 8.9mt of copper ore on 31 March 2013, the mine life has been extended to around four years
Group structure

Last year we initiated a major project to simplify our Group structure and unlock value. This is focused around the merger of Sesa Goa Ltd and Sterlite Industries (India) Ltd to form Sesa Sterlite Ltd, aiming to create a more efficient capital structure across the Group with better alignment of debt and cash flows, as well as delivering significant synergies. The necessary approval from the High Court of Bombay at Goa has been received and we now await the approval of the High Court of Madras.

"We have a proven track record of consistently growing our reserves and resources (‘R&R’) organically. We remain focused to continue to add more than we mine out, in line with our strategy to maintain a portfolio of assets with long mine life.”
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Engineers at control room of Lanjigarh refinery, VAL.
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Aerial view of Tailings management facility rehabilitation plots, Lisheen.
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Ball mill at the newly commissioned East Mill at Nchanga Concentrator, KCM.
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