Coal India today said it has entered into an agreement with state-run power company NTPC for revival of two fertiliser plants following the direction from nodal ministries after a meeting at the PMO.
As per the deal, the 50-50 joint venture company will establish and operate new fertiliser complex (ammonia urea) at Gorakhpur and Sindri units of the Fertilizer Corporation of India Limited (FCIL) and to market its products, it said.
"Ministries of Coal and Power directed CIL and NTPC to enter into joint venture for revival of these projects and hence JV agreement was signed between two companies," CIL said in an NSE filing.
NSE had sought a clarification over the announcement of signing of an agreement for setting up of a joint venture company at 50:50 shareholding basis for revival of Sindhri & Gorakhpur units.
As per the minutes of the meeting held at the PMO, both coal and power ministries were told that they can involve more than one PSU belonging to their ministries in the joint venture, Coal India said.
The PMO had held the meeting on April 7 to discuss to finalise modalities for revival of Sindri and Gorakpur units of FCIL and and Brauni unit of Hindustan Fertiliser Corporation Ltd (HFCL) for setting up of an ammonia urea plant at each location, it added.
Last year, CIL had entered into a joint venture agreement with GAIL and fertiliser majors RCF and FCIL to incorporate a firm for setting up and operating new ammonia urea complex in Talcher, Odisha.
These agreements are part of the governments plan to revive loss-making and closed fertiliser plants through JVs of profit-making PSUs with a view to increasing domestic production of the farm nutrient.
