The refinery has been closed since December 2012 when the bauxite literally ran out and the company set about sourcing raw material from mines in surrounding Indian states. At the moment, Vedanta is getting some bauxite from Balco, an associate company, although it has been trying to persuade rival Nalco to supply it with the raw material at an inflated price.
Nalco is in the process of deciding how to approach the issue of supplying its arch rival with bauxite and fears union problems based on privatisation fears. The company mines around 6Mt of bauxite from its own mines and produces 2.2Mt of alumina in a Koraput alumina refinery. The refinery supplies 2Mt of alumina to a Nalco smelter in Angul and the rest is exported.
While it has been agreed to send trial truckloads of Nalco bauxite to Vedanta's Lanjigarh refinery, past experience proves that Nalco supplying Vedanta is not straightforward. In 2008/09 a consignment of bauxite from Nalco was stopped due to union opposition and it's linked with an inate fear of privatisation 'through the back door' so to speak.
The end-2012 closure of Lanjigarh affected the lives of 30,000 people.