Hindustan Zinc outlines $2.5 bn expansion plan to double output, work to begin in FY26

Hindustan Zinc

Hindustan Zinc Ltd plans to invest $2.5 billion (Rs 20,900 crore) to double its annual production capacity to 2 million tonnes of zinc, lead and silver, Chief Executive Officer Arun Misra said in an interview. The expansion is expected to start in the first quarter of the next fiscal year, he said.

"Expansion will be brownfield with the existing mines, while greenfield will be a new smelter with up to 0.6 million tonne capacity. The rest of the capacity will come from expansion or de-bottlenecking of the existing smelters," Misra said on the sidelines of Zinc College 2024, an event organised by the International Zinc Association (IZA) in Udaipur.

HZL hired two Australian mine-planning and mine-contracting firms to develop a plan for doubling the capacity of its mines, Mint reported in July. The company has also engaged a consultant to work on expanding its zinc smelting capacity — a mix of greenfield and brownfield diversification — Misra added.

The 58-year-old company operates six mines, all of which are located in Rajasthan. It has three smelters. Zinc smelting alone accounts for 913,000 tonnes per year, according to the company's latest annual report.

IZA has forecast a significant rise in zinc demand in India by 2030, driven by emerging sectors such as renewable energy and battery technology coupled with infrastructure, steel and automotive. "We are optimistic that zinc demand to double in less than 10 years," said Andrew Green, Executive Director, IZA.

The battery energy storage market could reach 422 giga watts per hour (GWh) by 2030, with zinc poised to be a key element in the development of long-lasting and sustainable energy storage solutions. HZL is looking to set up a battery manufacturing facility in partnership with US-based battery tech firm, Aesir Tech, which will look at zinc battery solutions for various type of applications, Moneycontrol reported on August 2.

Foray into battery business

Misra said the company is in advance talks with a potential battery manufacturer in the country and Aesir Tech will share the technology with it. "We are likely to sign a tripartite agreement by November," he added.  Aesir specialises in developing next-generation Nickel-Zinc battery technology, which is used in the aerospace, defence and critical infrastructure sector.

India is primarily dependent on lithium-ion batteries and lead-acid batteries for energy transition. "Lithium has a much higher price, as compared to zinc for the same tonnage. While zinc is safer and not susceptible to overheating. Typically, Indian customers are cost conscious," Misra said.

The move aligns with HZL's efforts towards exploring emerging applications of zinc in clean energy transition.

Emerging sectors for Zinc  

IZA forecasts global zinc demand in solar to grow by 43 per cent , wind to double by 2030. The energy storage is likely to expand sevenfold over five years. The battery energy storage market could reach 422 GWh by 2030, and zinc is poised to be a key element in the development of sustainable energy storage solutions, the zinc producers' body said in a press statement.

"India’s growing middle class is driving demand for zinc in automotive manufacturing. The demand for zinc is forecasted to rise significantly by 2030," it added.