Odisha Mining Corp Demands ₹5,600 Crore from Vedanta Over Bauxite Pricing Dispute

OMC seeks payment by October 31, 2026, as Vedanta challenges High Court ruling in Supreme Court over decades-old bauxite pricing agreement

By OdishaConnect On Oct 7, 2026

Vedanta Aluminium Ltd is facing a ₹5,600 crore demand from Odisha Mining Corporation (OMC) following the Orissa High Court’s rejection of the company’s plea to retain an old pricing arrangement for bauxite. The development could significantly increase raw-material costs for Vedanta, India’s largest aluminium producer.

OMC has issued a demand and intimation letter to Vedanta Aluminium, with the amount payable by October 31, 2026, according to people familiar with the matter. The demand follows the High Court’s dismissal of Vedanta’s petition seeking enforcement of a 2004 agreement under which OMC was to supply 150 million tonnes of bauxite at a price linked to extraction costs, along with royalty and other statutory charges.

The court held that the earlier agreements had been terminated in September 2015 following changes to the Mines and Minerals (Development and Regulation) Act. Vedanta had not challenged the termination at the time, and the court observed that the matter had therefore attained finality.

The ₹5,600 crore demand is equivalent to around 40% of Vedanta Aluminium’s ₹14,153 crore profit after tax in FY26, highlighting the potential financial impact of the dispute.

Vedanta has now approached the Supreme Court seeking a stay on the High Court order. The company filed its petition on October 5, with the matter expected to be heard shortly.

The dispute dates back to the October 2004 agreement between Vedanta and OMC. Vedanta has argued that it made substantial investments in Odisha based on assurances of long-term bauxite availability and stable pricing.

The court’s decision could have implications beyond the immediate ₹5,600 crore demand. Vedanta may have to source bauxite at significantly higher prices under the average sale price methodology, potentially raising the cost of producing alumina and aluminium.

The company currently has no operational bauxite mines and has secured the Karlapat bauxite block through a record-premium bid, making raw-material costs a growing concern.