Vedanta Aluminium halts refinery on bauxite shortage

A bird flies by the Vedanta office building in Mumbai August 16, 2010.

NEW DELHI (Reuters) - India's largest aluminium maker, Vedanta Aluminium Ltd (VAL), will temporarily shut its alumina refinery in Odisha due to bauxite shortages, the president of the company, a unit of London-listed Vedanta Resources (VED.L), said.

"Despite all our efforts we could not arrange bauxite ... we are closing down the unit from December 5," Mukesh Kumar told Reuters on Tuesday.

The shutdown of the refinery is unlikely immediately to affect VAL's aluminium output, Kumar said.

The 1 million tonnes a year plant at Lanjigarh in Kalahandi district of Odisha will restart only after securing supplies of bauxite, the raw material to produce alumina, from which aluminium is made.

VAL is seeking a long-term supply arrangement, Kumar said without giving details.

The refinery, which requires 10,000 tonnes of bauxite a day to operate at full capacity, has faced bauxite shortages since it was commissioned in August 2007.

Vedanta says the plant is designed for local bauxite and only this material can ensure its sustainability.

(Reporting by Jatindra Dash; editing by Mayank Bhardwaj and Anthony Barker)