Sterlite's Rs. 23 billion expansion on hold
5 January 2010
Responding to a Writ Petition filed in the Madras High Court (Madurai Bench) challenging the environmental clearance and license to construct granted to Sterlite Industries' for expanding its copper smelting capacity from the current 400,000 tpa to 800,000 tpa, the company was forced to commit an undertaking that it would not go ahead with the expansion. On 15 October, 2009, the company had announced through a press release a 400 ktpa expansion along with a 160 MW captive power plant and other associated plants at an investment of Rs. 2300 crores (Rs. 23 billion). The company had obtained an environmental clearance from the Ministry of Environment & Forests on 01.01.2009, and a license to construct from the Tamilnadu Pollution Control Board on 12.03.09.
The Writ Petition filed by Mr. Pushparayan of East Coast Research and Development, Tuticorin, before the High Court Madurai challenges the 01.01.2009 clearance granted by the Ministry of Environment & Forests. The clearance was granted without any public hearing citing a provision in the EIA Notification. Further, the Tamilnadu Pollution Control Board's license to construct (Consent to Operate) under the Air and Water Acts referred to an earlier Environmental Clearance dated 22.02.2008 and not the 01.01.2009 clearance. The earlier clearance was rescinded when the new clearance was granted. Curiously, the TNPCB's license reflects the production figures approved in the 01.01.2009 clearance, which permits construction of a 1200 tpd (400 ktpa) smelter. The earlier clearance permits construction only of an additional 600 tpd (200 ktpa) smelter.
The writ petition was filed on various grounds, including that the decision to exempt the expansion from a public hearing was wrong. The exemption was granted by the Ministry of Environment & Forests on grounds that the project was coming up within a notified industrial area, and hence eligible for specific exemption under the EIA Notification, 2006. However, petitioners have pointed out that the company has occupied more than a 100 acres of private land, and the exemption does not apply.
Mr. Prakash, senior counsel, appeared for the petitioner and Mr.A.Sundaram, senior counsel from New Delhi appeared for the Sterlite Industries.
During the course of hearing, the counsel for the respondent gave an undertaking that Sterlite would not go for expansion until the matter is resolved. The matter was adjourned by 4 weeks and all the respondents including the MOEF and the TNPCB are directed to file their counters by such time.
Attached is a copy of Sterlite Industries India Ltd's October 2009 press release and announcement to the Bombay Stock Exchange.
For more information, contact: Mr. Sambuvarayan, Advocate: 9841333648
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