Vedanta needs 300kt of bauxite on a monthly basis to operate the plant at full capacity but, says chief operating officer Mukesh Kumar, the plant will re-open if 50% capacity utilisation can be realised.
Lanjigarh's chief sources for bauxite once the plant re-opens will be BALCO's Kawardah mines in Chhattisgarh and private mines in Gujarat.
The refinery's closure has adversely affected the economy of the local area where demonstrations have been commonplace following many job losses. It is estimated that the refinery employed 7,000 people both directly and indirectly.
It is argued that bauxite excavation in the Niyamgiri Hills is crucial to the future prosperity of the refinery and, therefore, the local economy.
The state government wants to initiate so-called 'gram sabha' or village meetings to discuss mining on the slopes of the Niyamgiri.
Approval to mine the Niyamgiri Hills is expected by September 2013 and production by September 2015.
Plans are also in the pipeline to expand the refinery from it's current 1Mt/yr up to 5Mt/yr.
The original closure of the plant last year was prompted by environmental issues concerning forest clearances on the slopes of the Niyamgiri Hills.