Sri Lanka cashes in on the export of mineral sands
Sri Lanka is currently cashing in on the export of mineral sands by refining it to ilmenite, rutile, and zircon at its Pulmoddai plant with limited human resources and expertise, officials of the Lanka Mineral Sands Ltd (LMSL), a State -owned company, said.
The present production is now limited to 6000 tons of ilmenite,1,800 tons of rutile and 600 tons of zircon as the price of ilmenite in the international market has come down to US$92 per ton from $320. Rutile fetches a price of $700 a ton and zircon $850 Dishan Goonasekera, Chairman and Managing Director of LMSL disclosed in an interview with the Business Times.
Dishan Goonasekera
The company has taken a strategic decision to curtail ilmenite production and to increase the production of rutile and zircon to meet international price fluctuations, he said adding that it is now bringing dividends.
Sri Lanka is earning millions of dollars in foreign exchange from the export of these three minerals without value addition and the cost of the refining of mineral sands is low, Mr. Goonasekera said. The mineral export in raw form is very profitable for the country as the LMSL’s recurrent expenditure including the salary bill and overheads is very low, he emphasised.
LMSL is not in a position to enter into value added production such as making Titanium dioxide used to make Titanium, the valuable metal of the present and future as it has no financial and human resources as well as necessary expertise, he disclosed. The only option is to enter into a joint venture with local or foreign investors to produce value added mineral products, he said adding that LMSL currently exports mineral sand to Russia, Japan, US and the UK.
This company is functioning under the Ministry of State Resources and Enterprise Development. The company head office is located at Colombo and the work force is around 600.
Modification and upgrading of the present plant in Pulmoddai has been completed, he said adding that his company is contributing large sums of money for national coffers but it cannot carry out its functions with maximum productivity due to lack of human resources and other facilities.
What Sri Lanka needs is an advanced technology to develop the industry.
M.W.W. Dahanayaka
Negotiations in this regard are being held with regional countries, Europe and USA, he revealed.
He paid a tribute to his work force including engineers headed by the General Manger for their commitment to improve the institution without sufficient salary benefits.
LMSL General Manager M.W.W. Dahanayaka told the Business Times that the company has recorded a profit of Rs.253 million after tax in 2013. The revenue was Rs. 947 million.
The profit of the Pulmoddai Mineral Sands Company which was Rs. 239 million in 2009 has recorded a new high of Rs. 7 billion in 2011.
The company has spent a sum of around Rs. 240 million to improve infrastructure facilities including electricity and install machinery and spare parts at the Pulmoddai factory, he said.
LMSL has given Rs. 523 million in 2010, Rs.500 million in 2011, Rs. 2225 million in 2012 and Rs. 43 million in 2013 to the Treasury as dividends, he said adding that and the amount was less last year as the company had to spent money for the improvement of infrastructure facilities.
The company will install new machinery worth $70 million in the Pulmoddai production plant to increase its production capacity.
Mineral sand deposits are found along the eastern coastal belt from Mullaitivu to Pulmoddai and from there to Kotuwakambi. This is one of the most treasured natural resources of Sri Lanka.
At present a plan for the scientific and systematic development of the mineral industry is being implemented. Mineral sand is a 100 per cent export oriented product.
There is a big demand for SriLankan mineral sand from industrial countries.
The value of mineral sand had increased sharply during the last couple of years, he said.