FCC

Adani Group's $1.2B copper plant to enhance India's metal output

2024-02-06

In New Delhi, it has been reported that the Gautam Adani-led group, a billionaire conglomerate, is in the process of constructing the world's largest single-location copper manufacturing plant in Mundra, Gujarat. This initiative is aimed at reducing India's reliance on imports and facilitating the country's transition towards sustainable energy, according to sources. The facility, with a total investment of $ 1.2 billion, is anticipated to commence its initial phase of operations by the end of March. The complete 1 million tonnes capacity is projected to be operational by the fiscal year 2029 (March 2029), as indicated by two sources knowledgeable about the development.

The construction of this massive copper manufacturing plant aligns India with countries such as China, where there is a rapid expansion of copper production?an essential metal for transitioning away from fossil fuels. Various technologies crucial for the energy transition, including electric vehicles (EVs), charging infrastructure, solar photovoltaics (PV), wind power, and batteries, all rely significantly on copper.

Kutch Copper (KCL), a subsidiary of the Adani Enterprises (AEL), the flagship company of the Adani Group, is spearheading a greenfield copper refinery project to produce refined copper with an annual capacity of 1 million tonnes in two phases.

Regarding Phase-1, which involves a capacity of 0.5 million tonnes per annum, KCL successfully secured financial closure through a syndicated club loan in June 2022.

According to one of the sources, the Adani Group's vision is to establish itself as a global leader in the copper industry by leveraging its strong positions in resource trading, logistics, renewable power, and infrastructure. They aim to transform into the world's largest copper smelting complex by the year 2030.

The source mentioned that India's per capita copper consumption is currently estimated at around 0.6 kg, in contrast to the global average of 3.2 kg. The drive towards clean energy systems, the increasing adoption of electric vehicles, and various associated applications are anticipated to double the domestic demand for copper by the year 2030.

The Adani Group is making substantial investments in energy transition, with a particular focus on the crucial role that copper will play in this transition. The conglomerate is diversifying into areas adjacent to its existing capabilities, making the copper business a strategic fit, the source added.

Copper, being the third most used industrial metal after steel and aluminium, is experiencing a surge in demand due to the rapid growth of renewable energy, telecommunications, and the electric vehicle industries.