IFFCO's urea unit expansion continues to face delay

Last Updated: Sun, Oct 28, 2012 19:40 hrs

Fertilizer cooperative, the Indian Farmers Fertilizer Cooperative Limited (IFFCO) continues to face delay in expansion of its urea making facility at Kalol in North Gujarat. As the officials maintained, non-availability of natural gas is one of the reasons causing delay in expansion project.

IFFCO is planning to set up a urea plant at Kalol with an annual capacity of 1.4 million tonnes per annum (MTPA), which was estimated to cost over Rs 4500 crore.

"There are several issues affecting expansion project. One of them is availability of natural gas. We are not getting adequate quantity of gas for the additional capacity. So, presently we are not going ahead with the expansion. However, the expansion plan is not scrapped either," said a source at IFFCO's Kalol unit requesting anonymity.

It has been over three years, that the farmers' cooperative has been awaiting natural gas supplies from KG-basin to start the work at its urea making facility in Kalol.

Last year in August, IFFCO chairman, N P Patel, had informed that due to non-allocation of gas, the expansion was stalled and the delay in allocation was causing the project costs to rise.

However, IFFCO officials maintained that the Kalol unit continues to get sufficient quantity of natural gas for its present requirements.

"The current production operations are going smooth and there are no issues with regards to natural gas allocation. Even we have been allowed to purchase gas at spot rates, but we are able to manage in the present allocation," said the IFFCO official at Kalol.

Currently, IFFCO produces ammonia and urea at the Kalol unit and consumers over a million standard cubic meters per day (mscmd) of natural gas. At the expanded capacity, the plant would require about double the volume of natural gas used presently.

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