BALCO to triple aluminium output

India's Bharat Aluminium Co. aims to triple its aluminium output to more than one million tonnes in three years to meet surging domestic demand for the metal, the company's chief executive said on Monday. BALCO, a unit of UK-based Vedanta Resources Plc., runs two smelters at Korba in Chhattisgarh, with a total capacity to produce 345,000 tonnes of aluminium a year. "In three years time, we will have about three times the production capacity," Pramod Suri told Reuters in an interview. India's rapidly expanding economy that is growing at about 9 percent annually has spawned demand for new homes, offices and automobiles -- all consumers of aluminium. Suri said domestic consumption of aluminium was rising 15-16 percent a year, at double the world rate of 7-8 percent. At 0950 GMT, LME aluminium prices were at $2,615.50 a tonne, down from $2,805 at end-2006. Prices of aluminium in India are benchmarked to the London Metal Exchange. Suri did not give a forecast for prices but said BALCO would spend $2 billion to build a new smelter at Korba to produce 650,000 tonnes of aluminium annually over the next three years. It also aims to double the capacity of one of the existing smelters to 200,000 tonnes by upgrading technology. The capacity of the other smelter that can produce 245,000 tonnes annually will be raised by about 3 percent, Suri said. BALCO, India's third-biggest aluminium producer, hopes to raise output to about 350,000 tonnes in the fiscal year that ends in March 2008, up more than 10 percent from the previous year's 310,000 tonnes, he said. Suri said the company was hoping to meet its requirement of alumina, a semi-processed raw material, from within the group through a refinery in Orissa. It now partly relies on imports for alumina. The company is also looking for new bauxite mines in Chhattisgarh, where it has a mine in Kawardha and another in Mainpat, he said.