India’s ONGC plans new gas-based Maharashtra fertilizer project

08 October 2013 08:00  [Source: ICIS news]

KOLKATA (ICIS)--India’s ONGC Ltd will invest about $810m (€599m) to build a new gas-based fertilizer plant in Maharashtra province, a company official said on Tuesday.

The proposed gas-based urea plant would be linked to ONGC’s gasfields in Daman in western India that is scheduled to go into production in 2014-15, the official said.

The Daman gasfields, along with others in the region, would be able to make about 13 million standard cubic meters per day (mmscmd) of gas available to the new urea project, according to the official.

The plant's capacity has yet to be determined, the official said.

ONGC also plans to shell out around $1.6bn to build the required infrastructure to support the proposed urea facility, the official said, adding that the amount would cover funding for a new gas processing plant, an 80-kilometre pipeline network and a power plant.

The feasibility of the proposed fertilizer cum power plant, however, would largely depend on the availability of gas for power generation, taking into account the Indian government’s prioritised allocation of gas for fertilizer production, the official said.

ONGC needs to build a separate gas processing plant as its two existing processing units at Hazira in Gujarat and Uran in Maharashtra have no spare capacity to supply feedstock to a new urea production facility, the official said.

The proposed Maharashtra project would be the company’s third in the fertilizer industry, as it diversifies its business from oil and gas exploration and production, the official said.

ONGC is currently building an 864,000 tonne/year urea plant through Brahmaputra Valley Fertilizer Corp Ltd (BVCL), in collaboration with Oil India Limited (OIL) in north eastern province of Assam. The plant is due to start up next year.

The company is also building a 1.3m tonne/year urea plant, in collaboration with Chambal Fertilizers and Chemicals Limited in Tripura province in north east India.

Though a final call on having a gas-based power plant, along with the urea project in Maharashtra had not yet been taken, ONGC is keen on a new fertilizer cum power project along the lines of its project in Tripura, where the company has commissioned a 726-megawatt (MW)  power plant early this year, the official said.

($1 = €0.74)

Read John Richardson and Malini Hariharan’s blog – Asian Chemical Connections

Author: Ajoy K Das

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