IFFCO awaits gas allocation for fertiliser plant

Country’s largest fertiliser manufacturer Indian Farmers Fertiliser Cooperative Limited (IFFCO) is still awaiting the allocation of gas by the Centre for setting up a new fertiliser unit at Kalol in Gujarat.

IFFCO currently has 5 plants at Allahabad and Bareilly in Uttar Pradesh; Kalol and Kandla in Gujarat; and Paradeep, Orissa.

The company has applied for 2.9 million metric standard cubic metres per day (mmscmd) of gas for the proposed plant.

“As per out estimates, the plant would entail in investment of Rs 4,500 crore. We have adequate land and water linkage for the proposed project, which will take off once the Centre allocates the gas,” IFFCO Managing Director U S Awasthi told Business Standard.

So far, the company had spent close to Rs 40 core in creating the site office and other basic infrastructure. “I am not in a position to comment on the timeline, when the gas would be allocated,” he said.

Awasthi had recently visited the neighbouring Unnao district for a soil rejuvenation project run by IFFCO.

The Indian fertilizer majors are reducing the use of naphtha, an alternative feedstock extracted from crude oil, to produce urea.

The cost of producing the nutrient with domestic gas supply is less than half compared to naphtha. However, the centre has the final say in the allocation of gas to industry.

IFFCO’s five existing plants produced 8.19 million tonnes of fertiliser material during 2009-10, comprising 4.32 million tonnes of urea and 3.87 million tonnes of Diammonium Phosphate (DAP) and other soil nutrient varieties.

Meanwhile, IFFCO had made an annual provision of Rs 100 crore for three years on projects to improvising farm productivity and reducing input cost.

The methods adopted include educating farmers about cropping pattern, supply of good quality seeds, encouraging organic fertiliser, better water management and reclamation of sodic land.

“We target to improve food grain production by 25 per cent with greater use of organic manure, but reducing input cost,” he said. IFFCO wants to reduce the consumption of chemical fertiliser by 25 per cent for balanced manure consumption.