Vedanta Ltd has doubled its annual zinc production capacity in South Africa to 500,000 tonnes following an investment of nearly $600 million in the second phase of its Gamsberg mine, as the metals major seeks to expand its global zinc production to 3 million tonnes annually.
South African President Cyril Ramaphosa and Vedanta Ltd director Priya Agarwal-Hebbar inaugurated the expanded capacity at Gamsberg in the Northern Cape province on Sunday. The company said the expansion was among the largest mining investments in South Africa in the current decade.
Vedanta aims to produce 3 million tonnes of zinc annually across India and South Africa, with its subsidiary Hindustan Zinc targeting 2 million tonnes and Vedanta Zinc International aiming to contribute 1 million tonnes. Hindustan Zinc is the world’s largest integrated zinc producer.
The Gamsberg expansion takes Vedanta Zinc International’s annual capacity to 500,000 tonnes of metal-in-concentrate. The company’s broader production target includes both refined metal and metal-in-concentrate.
The investment is part of Vedanta’s commitment to invest 21 billion South African rand, or nearly $1.5 billion, announced at the 2018 South Africa Investment Conference.
Ramaphosa welcomed the expansion and said the government would work with Vedanta and other partners to address the company’s requirements, including its ambition to establish zinc smelting capacity in the Northern Cape.
Priya Agarwal-Hebbar said the project was aimed at developing a globally significant zinc and industrial hub in the region, creating jobs and supporting economic growth.
Zinc is widely used in galvanisation to protect steel from corrosion and is an important input for construction, automobiles, manufacturing and infrastructure. Rising industrial and infrastructure demand is expected to support consumption of the metal.
Vedanta’s expanded capacity comes as it seeks to strengthen its position in the global zinc market by leveraging its operations in India and South Africa.
The company said it had invested nearly $20 million in community initiatives in South Africa since acquiring Vedanta Zinc International in 2011. These programmes cover healthcare, education, livelihoods, infrastructure and social welfare, benefiting more than 32,000 people annually.
Vedanta Zinc International also opened an oncology centre in Namakwa earlier this year as part of its community development initiatives.