APL signs debt agreement to implement Rs 1028 cr project

The pact will help APL raise debt capital of Rs 635 cr to implement 500 TPD capacity methanol and 200 TPD capacity acetic acid project in Upper Assam

Assam Petro-chemicals Ltd (APL), a public sector undertaking, has signed debt agreement with ten banks to implement a Rs 1,028 crore methanol- acetic acid project.

The debt agreement will help APL raise debt capital of Rs 635 crore to implement the 500 tonnes per day (TPD) capacity methanol and 200 TPD capacity acetic acid project at the existing location of the factory at Namrup in Dibrugarh district in Upper Assam.

The equity capital amounting Rs 393 crore will be invested by Oil India Ltd (OIL), government of Assam and Assam Gas Company Ltd (AGCL). State Bank of India (SBI) is the lead bank with whom APL has signed the debt agreement.

Ratul Bordoloi, managing director of APL, said all most of the preparatory works for the new project have been completed. The new integrated methanol-acetic acid plant will place APL as the biggest natural gas based petro-chemical complex in the entire North-Eastern region, said Bordoloi.

Bordoloi added that demands for methanol and acetic acid were increasing a rate of 6 per cent and 4 per cent respectively, prompting the company to go for an expansion plan of this magnitude. He said presently 60 per cent of methanol and acetic acid demands of India were being met by imports.

APL is the only public sector undertaking from the North-Eastern region which had a public issue. It is listed in the Bombay Stock Exchange Ltd (BSE) and the Guwahati Stock Exchange (GSE). Despite a beginning of moderate prosperity marked by a struggle for survival, the company today is a profit making, dividend paying industry of the Assam government with 88 per cent equity participation from Assam Industrial Development Corporation (AIDC). APL presently has a 100 TPD capacity methanol plant and a 125 TPD capacity formaldehyde plant.