National Fertilizers Ltd (NFL) is set to clinch a gas supply pact with GAIL India in the next 10-15 days to meet demand while some other companies are in advanced stages of discussion with the gas utility to buy the key fuel.
"NFL and some other companies are in discussion with GAIL. I think some discussions have advanced substantially. So they (NFL and some companies) will be able to sign the supply agreement with GAIL," Fertiliser Secretary Atul Chaturvedi told PTI.
"I believe it (gas supply agreement) should be done in the next 10-15 days, at least (for) some companies," Chaturvedi said when asked about the timeframe within which the pact will be done.
The secretary, however, refrained from divulging details on this issue.
The gas supply agreement assumes significance as fertiliser units in the country currently get only 29 mmscmd of gas against a demand of about 42 mmscmd even though the Centre has decided to accord priority to such plants for the allocation of gas even from new finds.
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Fertiliser Minister Ram Vilas Paswan had earlier warned that India might lose investment worth Rs 40,000 crore in the urea sector if plants are not provided gas in time. There are 20-odd gas-based fertiliser units in India.
A senior NFL official said the company has sought 0.65 mmscmd of gas from GAIL India to meet the immediate shortfall. "We need 3.7 mmscmd of gas a year. We have sought 0.65 mmscmd to tackle immediate demand," he added.
The company will need 0.88 mmscmd of gas over and above its annual requirement in the next two years to undertake expansion and revamp, the official said.
NFL, the second-largest producer of nitrogenous fertilisers, also accounted for 16.5 per cent of the country's total urea production in 2007-08. At present, it is in the process of revamping its facilities in Bathinda and Panipat.
Chaturvedi had earlier said fertiliser units were likely to get 13 mmscmd of gas from new fields, adding that about 14 mmscmd would be required for the intitial phase of revival of the proposed units and expansion of some units of Iffco, Kribhco and NFL.