Mangalore Chemicals and Fertilizers (MCF), which had stopped operations at its naphtha-based urea plant in Mangaluru on October 1, resumed production on Wednesday.

Earlier, the Centre had asked naphtha-based urea manufacturing units to switch to gas as the feedstock before September 30.

It said those who continued with naphtha for the production of urea would not be eligible for subsidy.

Govt support

However, the Centre issued a notification on Wednesday for continuation of subsidy to MCF for the next 100 days after receiving confirmation from the Karnataka State Government that it would waive value-added tax on naphtha, said KN Suryanarayana, President of Mangala Workers Union at MCF, told BusinessLine.

He further thanked both the State and Central governments for their support in resuming production at the plant.

“We are hopeful that the Union Fertiliser Minister (Ananth Kumar) will take appropriate decision to continue urea production till gas connectivity is provided to our unit by the Central Government,” Suryanarayana said.

Sources in the company said the plant would be able to come out with production in another five days, as lighting of boiler and furnace began at the plant on Wednesday.

LNG feedstock

MCF had spent around ₹300 crore for converting the factory from a naphtha-based unit to an LNG-based one.

Replying to a question in the Lok Sabha in November, Ananth Kumar had stated that as per the original plan, MCF was supposed to get LNG from the Petronet LNG terminal in Kochi through a gas pipeline, planned by GAIL from Kochi to Mangaluru.

Farmers’ resistance

Laying of the pipeline was facing stiff resistance from farmers and it might take 24 months or more to complete the project, he added.

Quoting the Minister, a PIB tweet said on Wednesday that the Kerala Government is ready to give right of way for the gas pipeline between Kochi and Mangaluru.

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