Vedanta On Track To Meet Lead, Silver, Overseas Zinc Targets

By Alex MacDonald

LONDON --U.K.-listed, India-focused Vedanta Resources PLC (VED.LN) remains on track to meet its production targets in lead and silver, as well as zinc from its overseas operations, this year and hopes to achieve its targeted rate of oil and gas production in the near-term, the company's chief executive said Tuesday.

"We remain on track to deliver earlier projected growth in the integrated silver and lead production for the year as a whole at about 100,000 tons of lead and about 11 million ounces of silver" driven by the ramp-up of its SK mine and the new 100,000 ton-a-year Dariba lead smelter, both in India, MS Mehta said in a conference call about the company's second fiscal quarter results.

Vedanta produced 53,000 tons of lead from its integrated operations in the first six months ended Sept. 30, up 59% on year, while integrated silver production rose 61% on year to 5.14 million ounces.

Moving onto Zinc International, Mr. Mehta said the company remains on track to deliver the volume guidance given in May of around 400,000 tons of zinc, largely due to lower grade ore. Zinc International produced 220,000 tons of zinc in the first half of the fiscal year, down 5% on year.

He also said the company's majority-owned Cairn India Ltd. (532792.BY) is seeking to achieve a near-term production target of 240,000 barrels of oil equivalent output a day by calendar 2013, primarily through the start-up of several fields coming online by March 2013. Cairn India produced record second-quarter oil output of 207,245 barrels of oil a day, due to the ramp-up of production in the Indian state of Rajasthan.

At 1043 GMT, Vedanta's shares were up 3.2% at 1,102 pence a share, while the FTSE 350 mining index was up 1.5%.

Mr. Mehta also said the corporate restructuring process was on track to be completed by the end of the year. Vedanta has proposed an all-share merger between metals producer Sterlite Industries (India) Ltd. (500900.BY) and iron ore producer Sesa Goa Ltd. (500295.BY) to create Sesa Sterlite, an India-based natural resources champion, with combined sales of $14.2 billion, that would simplify Vedanta's holdings across various units.

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