SLMS to modernize operation though new fund by billion rupee mineral sand sale
Sri Lanka Mineral Sands (SLMS) is looking at a modernizing plan by establishing a new fund to finance its daily operational costs along with the modernization of machinery and purchase plants to increase production.
SLMS Chairman Maithri Gunaratne has told the Business Times that the company was able to secure a sale of Rs.1.23 billion worth of mineral sands by calling for an international tender for which they received five bids. It was finally awarded to Alchemy Heavy Metals.
Gunaratne has explained that this amount was generated by calling for tenders for the sale of varied amounts of Rutile, Zircon, Hi Ti ilmenite and ilmenite except the tender floated amounting to the sale of one stock of 9000 MT of ilmenite that was cancelled earlier by the Industry and Commerce Ministry.
Out of the total sale amount, SLMS has deposited Rs.900 million in a high interest Fixed Deposit (FD) account with Seylan Bank for their future operational requirements.
The newly set up fixed deposit is expected to generate earnings in the range of Rs.123 million per year.
According to the Chairman, the FD earnings would be allocated to undertake the much-needed repairs, refurbishment, and replacement of the obsolete machinery currently available at the Pulmoddai plant as well as “value addition”.
It has been noted that carrying out value addition required at least 10, 000 mt of ilmenite which was previously unavailable. In future, however, this amount could be obtained if production continues smoothly following the purchase of new machinery.
Gunaratnehas pointed out that machinery at the Pulmoddai plant had not been maintained for the last 20 years and as a result the efficiency of this machinery had dropped by about 40 per cent thereby causing a reduction in the quality of the minerals processed.
He has said that due to a drop in production levels they were looking at increasing this by purchasing new machinery and modernizing the equipment to ensure uninterrupted power supply to the organisation’s main plant at Pulmoddai.
He has also observed they found Rs.2 billion worth of stock at the plant where minerals were not accounted for and were said to have become contaminated as well.
Gunaratne has explained that they would be re-modeling the machinery by purchasing new machinery from Australia at a cost of approximately Rs. 20 million for the plant at Pulmoddai.
Meanwhile, the company has also called for tenders for the sale of 1000 mt of Hi ti ilmenite, 1000 MT of rutile, and 400 MT of zircon with tenders scheduled to close on November 21.
Another tender calling for the sale of another stock of 9000 MT of ilmenite closes on November 30.
OSL take:
Businesses engaged in using mineral sands could bid for the latest tenders called by Lanka Mineral Sands Company and look at new project portfolios through it. Also, businesses that possess the technology to uplift Lanka Mineral Sands could take the opportunity to form a partnership with the company through its latest modernization plan.
| Article Code : | VBS/AT/07112017/Z_3 |