Jamshedpur, Aug. 23: Production process in the ailing public sector undertaking Hindustan Copper Limited (HCL) is heading for a severe crisis following acute shortage of imported copper concentrate.

HCL’s production depends mainly on imported copper concentrate as majority of its own mines have closed down by the company as they had become uneconomical.

“Most of the imported copper concentrate of HCL comes from Australia. But there has been severe shortage of copper concentrate in that country following which prices of copper concentrate has escalated. The PSU is finding it extremely difficult to place its order for shipment of the material due to high cost,” sources in the company told The Telegraph.

According to sources, following the escalation of the cost of copper concentrate in Australia, HCL management could place its order to procure the material. “The stock that the company has now would last till end of September. But after that the production process in the company could be jeopardised,” sources said.

The cash-strapped PSU has already suffered a loss of over Rs 400 crores in the past four fiscals.

“Under such circumstances it would be virtually impossible for the company to procure raw material from Australia at a high price,” sources said.

The only company mine that is operational at present is at its Malajkhand unit at Rajasthan. The copper concentrate of that mine is meant for Moubhander smelter plant at its Indian Cooper Complex (ICC) unit at Ghatsila.

“But the major production of Copper by the company takes place at Khetri unit in Rajasthan where the imported copper concentrate from Australia is used. In the worst scenario, the cooper concentrate extracted from Malajkhand would be divided between Ghatsila and Khetri for production,” sources said.

HCL authorities have already informed the union mines ministry officials about the crisis. It has also sought permission from the ministry to undertake shutdown in the two smelter plants of the company, Khetri and Ghatsila, that would enable the company tide over the forthcoming difficult phase.

“But the mines ministry is not in favour of HCL shutdown as it would involve huge costs. They feel that when the company is already lined up for disinvestment, there is no need to incur extra costs,” sources said.