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Mumbai April 21 State-owned Rashtriya Chemicals and Fertilisers Ltd (RCFL) will shortly restart production from its 3.3 lakh tonne a year urea plant. This follows the signing of a gas supply and transportation agreement with Reliance Industries for supply of KG Basin gas.

Under the agreement, RIL will supply 2.1 mscmd of gas to RCFL’s Thal unit and 0.95 mscmd to the Trombay unit.

The company had closed operation of its urea unit as it had become unviable due to rising cost of naphtha.

Now after switching over to gas as feedstock, the company will significantly bring down the cost of urea production. Urea producers have been using gas and other feedstock such as naphtha and LNG.

Naphtha and LNG are expensive by about 50 per cent. Because of acute shortages of natural gas, many gas-based fertiliser plants are forced to use costlier feedstock like re-gasified LNG or naphtha.

Mr U.S. Jha, Chairman and Managing Director, said the company will be able to save Rs 800 crore in annual subsidy after the switchover.

More Stories on : Announcements | Fertilisers

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