State-run National Aluminium Co Ltd (NALCO) is likely to finalise within a month a deal to set up an alumina refinery in the western Indian state of Gujarat, Chairman B.L. Bagra said.
Gujarat had last year invited bids for a refinery and smelter in the state and committed to supply bauxite, a key raw material, at a pre-determined price.
NALCO, the country's third largest aluminium producer, had emerged as the only qualified bidder and plans to set up only the refinery for now.
There have been several meetings between NALCO and Gujarat Mineral Development Corp(GMDC) to finalise the draft agreement for the refinery project.
"Once the agreement is finalized, we will proceed with the preparation of detailed project report and construction of the refinery," Bagra told Reuters on Tuesday.
NALCO will take four to five months for preparation of the feasibility report after the deal is finalised and another two to three months for financial closure.
NALCO aims to invest 40 billion rupees in the one-million-tonnes-per-annum refinery project. It hopes to start construction within 2012 and commence production by 2015-end.
The state-run producer is also open to a joint venture with the Gujarat government for the project, Bagra said.
"In case ultimately it becomes a joint venture NALCO will prefer to have a controlling stake," he added, without elaborating further.
He said NALCO will considering setting up a smelter only when it has access to captive coal blocks and electricity supply at economic rates.
NALCO, which currently operates a 2.1 million-tonnes-a-year alumina refinery in the eastern Indian state of Odisha, plans to expand the refinery by a million tonnes but is still awaiting allocation of bauxite deposits.
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