You are here: Home » Companies » News
Business Standard

Clearance delays push RCF's project cost by Rs 500 cr

Sources added that only last year the project got pre-Public investment Board clearance and presently it is stuck at the PIB level

Press Trust of India  |  New Delhi 

Rashtriya Chemicals and Fertilizers's project cost for expansion of its urea plant in Maharashtra is likely to shoot-up by Rs 500 crore to about Rs 4,600 crore as the company is yet to receive the government's nod to start the project.

As per the proposal, an ammonia-urea plant will be set up at Thal in Maharashtra with a capacity of 1.27 million tonnes per annum on 200 acres of land.

Rashtriya Chemicals and Fertilisers (RCF) had awarded tender for the project to engineering and construction company Tecnimont ICB (TICB) in 2012 for Rs 4,112.50 crore, but construction work on the project did not initiate in last two years.

"Last month, the technology partner TICB had opted out of the project as it became unviable for them on the cost at which it was awarded to them two years back," sources said.

Sources added that only last year the project got pre-Public investment Board (PIB) clearance and presently it is stuck at the PIB level.

"RCF is contemplating to issue new tenders inviting bids for the technology partner of the project and as per the estimations, project cost is likely to increase by Rs 500 crore to Rs 4,600 crore," a source said.

The Mumbai-based PSU produces various grades of complex fertilisers at its two manufacturing units in Thal and Trombay in Maharashtra.

RCF, along with Coal India, GAIL and Fertiliser Corporation of India (FCIL), has also formed a consortium to revive the sick unit of FCIL at Talcher at a cost of Rs 8,000 crore to manufacture urea and ammonium nitrate via coal gasification.

The proposed unit at Talcher, which is expected to be commissioned by 2017, will manufacture 1.2 million tonnes of urea per annum (mtpa).

RCF had reported 28% fall in net profit at Rs 52.90 crore for the third quarter ended December 31.

Dear Reader,

Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.
We, however, have a request.

As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital Editor

First Published: Sun, April 13 2014. 14:59 IST