Standard & Poor's Ratings Services said today that its rating and outlook on Vedanta Resources PLC (foreign currency BB/negative/-) are not affected by the company's resumption of iron ore mining in the Indian state of Karnataka.

Our base case already factors the small-although positive-benefits from the development for Vedanta. "We believe the resumption of mining will add 1%-1.5% to the company's expected full-year consolidated EBITDA for fiscal 2014 (ending March 2014). The benefit to Vedanta's Indian subsidiary Sesa Sterlite will be more on a stand-alone basis," it said.

A monitoring committee appointed by the Indian supreme court permitted Sesa Sterlite to resume mining in Karnataka. Vedanta is allowed to produce about 2.3 million tons a year from the Karnataka mines. This compares with the company's total iron ore production of 19 million tons in fiscal 2011: about 3 million tons from Karnataka, 14.4 million tons from Goa, and the rest from Orissa. Mining was banned in Karnataka in August 2011 and in Goa in September 2012 due to environmental reasons.