Govt approves Rs 4500-cr ammonia-urea complex in Assam

The Cabinet, on May 21, 2015, gave its approval for setting up of a new ammonia-urea complex of 8.64 lakh metric tonnes (LMT) annual capacity with an estimated investment of Rs 4500 crore at Namrup in Assam on public private partnership (PPP) route by a joint venture (JV). The Cabinet, chaired by the Prime Minister Narendra Modi, also gave its approval for the revival of closed urea unit of Fertilizer Corporation India Limited (FCIL) at Sindri (Jharkhand) with an investment of Rs 6,000 crore.
 
In the proposed JV at Namrup, Brahmaputra Valley Fertilizer Corporation Limited (BVFCL), Government of Assam and Oil India Limited (another PSU) will have 11%, 11% and 26% equity holding respectively and balance 52% by private/public sector entity(ies) which would be inducted through a competitive bidding process.
 
The setting up of a new ammonia-urea complex will meet the growing demand of urea of North-East, Bihar, West Bengal and Jharkhand. It will also ease the pressure on infrastructure due to long distance transportation of urea from Western and Central Regions and thereby saving in government subsidy on freight. It will accelerate the economic development of the region. The proposed plant will open new avenues for the people of the North-East.
 
The new Namrup plant will be highly energy efficient unit of international standard with latest technology and with same amount of natural gas available to the existing units, the production of urea from the new unit will be more than double ie 3.6 to 8.64 lakh metric tonnes annually. With this, India is likely to start export of urea. Government would save about Rs 600 crore annually due to reduction in cost of production and import substitution. The entire production of urea from this unit will be neem coated so that benefits of neem coating are available to the farmers of the North-Eastern region also.
 
The annual consumption of urea in the country is approximately 310 LMT, out of which 230 LMT is produced indigenously and rest is imported. To enhance the production of urea indigenously, government has earlier approved the revival of Talcher (Odisha) & Ramagundam (Telangna) units of Fertilizer Corporation of India Limited (FCIL) by PSUs through ‘nomination route’ and Barauni unit of Hindustan Fertilizer Corporation Limited (HFCL) & Gorakhpur unit of FCIL through ‘bidding route’. These four units will produce about 52 lakh MT of urea annually.
 
At Sindri, the unit was lying defunct and was not in operation since 2002. Therefore, the unit and other associated facilities were lying unutilised. It is important to mention here that there is no functional urea unit in the Eastern part of the country except two small units at Namrup (Assam). Earlier, Sindri unit’s revival was to be done through PSUs (SAIL & NFL).
 
The setting up of a new unit at Sindri will meet the growing demand of urea in Bihar, West Bengal and Jharkhand. Apart from growth of regional economy, this unit will create opportunities for 500 direct and 3000 indirect employments.
 
The CCEA earlier had approved gas pooling for urea sector which will enable the unit to get gas at pooled price on its revival which will make the urea units globally competitive.