Agarwal Gets Nod to Reopen Oxygen Mill on India Demand Surge
A notice on a gate indicates that there is no oxygen at the Covid-19 Care Center in New Delhi. (Photographer: T. Narayan/Bloomberg)

Agarwal Gets Nod to Reopen Oxygen Mill on India Demand Surge

Vedanta Ltd. received approval to temporarily start producing oxygen at its shuttered copper smelter in southern India as a shortage of medical-grade oxygen is making the pandemic’s second wave more lethal in the country.

The Tamil Nadu state government has allowed the restart of the 1,000 tons a day oxygen mill at billionaire Anil Agarwal’s controversial copper factory for a period of four months, it said in a statement. However, Vedanta should not produce or start operations of the copper unit, it said.

Agarwal Gets Nod to Reopen Oxygen Mill on India Demand Surge

The smelter has been closed since 2018 on orders from the state government following the death of more than a dozen people when police opened fire on villagers protesting pollution from the facility.

Vedanta had filed a petition in the country’s top court last week to let the company produce oxygen from the unit again as India reels from the pandemic. Hospitals are overflowing with the sick and dying, and social media is flooded with desperate appeals from medical staff and the public alike for oxygen supplies.

To step up supplies, a state-run steel mill will undertake a “very short shutdown” and similar directions have been issued to other government-owned enterprises to augment stocks of liquid medical oxygen, India’s steel ministry said in a separate statement on Monday.

People are dying due to lack of oxygen, the Supreme Court said on Friday while hearing the case and told the state government that the court is “not interested that Vedanta or A, B or C runs it. We are interested that oxygen should be produced,” according to the Press Trust of India.

Tamil Nadu will provide electricity for the plant, with the oxygen generated prioritized for use in the state first, it said. Operations at the factory can be extended beyond the time frame if the current pandemic situation persists, the state government said, adding that it will monitor oxygen production at the plant.

Investors cheered the first signs of activity at the plant after a gap of three years, with shares of Vedanta closing 3.8% higher in Mumbai. Vedanta has fought multiple court battles to restart production at its 400,000 tons copper factory in Tuticorin and a fresh plea to restart the smelter is pending in India’s top court.

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