Six fertiliser units seek natural gas supplies for expansion
03 Dec 2009
Six companies, namely, Iffco, Kribhco, Rashtriya Chemicals and Fertilisers Limited, Indo-Gulf Fertilisers Limited, Tata Chemicals Limited and Chambal Fertilisers and Chemicals Limited, have sought assurances on availability of gas before taking final decision on expanding their existing units.
Announcing this in a written reply in the Lok Sabha today, minister of state for chemicals and fertilizers Srikant Kumar Jena said no government clearance was required for setting up of a fertilizer unit by any company.
He said the fertiliser ministry has taken up the issue with the ministry of petroleum and natural gas.
The empowered group of ministers (EGOM) had, on 27 October, considered the demand of natural gas for expansion and revamp of fertilizer plants and revival of closed fertilizer plants and decided that they would be supplied natural gas as and when they are ready to utilise the gas, the minister pointed out.
Jena said there was no change in the MRP of urea since March 2002. The urea units are allowed 12 per cent post-tax return on capital employed for arriving at the retention price before group averaging. The return allowed is not depended on MRP of urea. It is based on cost at the particular year, capital employed and net worth of the units.
The government, he said, has taken various measures to encourage efficiency and safeguard the interest of urea producing units.
Under NPS-III, pre-set energy norms have been notified for all the urea units. Savings in energy consumption achieved by the urea units with respect to pre-set energy norms are incentivised by payment at the weighted average basic rate of inputs consumed, he said.
