Published on August 25, 2014

With new government resuming the power the prime focus has been to concentrate more on fertilizer industry. In a recent move government has asked the Department of Fertilizers to design new plans to rejuvenate the operations at two or more Urea plants in eastern part of India. From last few years there has been consistent increase in the imports of Urea in the country. India accounts for 16-18 percent of global demand for urea. On other side there has been stagnancy in the domestic production of urea. From last few years India has been manufacturing around 22 million tonnes of Urea. With growing population demand for the chemical has been increasing. In order to encourage domestic production government has focused on setting up of Jagdishpur-Haldia gas pipeline to help out the fertilizer industries. Even government is assuring the manufacturers on thinking about buyback of the chemicals in order to make its more accessible and feasible.

In a move to revive the existing urea plant, two joint ventures will come into picture. Major gas supplier GAIL, Coal India, fertilizer manufacturers FCIL and RCF will be forming two joint ventures in order to revive the Odisha based Talcher Urea plant. The project will incur investment of around Rs.8,200 crore. In first major joint venture GAIL will be having majority of stake and will install a coal gasification unit. The second one will have RCF as major share holders and will be installing urea-cum-ammonia nitrate manufacturing unit having capacity of 1.2million tonnes per annum. In the first joint venture process will be of making gas from coal. Coal India will supply coal and GAIL will convert into gas. This gas supply will act as feedstock for the second joint venture. Urea will be manufactured from gas in next process. Huge budget has been allocated for this as all the machineries and equipments will be fresh and new. Government is hopeful that such moves will help fertilizer industry to increase their output.