Loss-making PSU Fertilisers and Chemicals Travancore (FACT) is likely to benefit from the sharp fall in feedstock LNG prices, officials of the company said. Declining oil prices have led to a sharp fall in global LNG prices that have declined by more than 75% since 2014.
The fertiliser factory started procuring LNG to produce ammonia after a gap of more than a year, buying at $7.79 per million British thermal units (mBtu).
ANZ research reports that global supplies of LNG is expected to rise 50% by 2020, and with demand from China seen weak, the fuel is expected to fall further. LNG was seen trading at an average of $16 per mBtu in 2015.
FACT had stopped procuring LNG from Petronet LNG in 2014 as it was not viable to operate its plants at $12 per mBtu , the rate offered by Petronet LNG. The firm had shutdown its ammonia plant and was importing ammonia.
FACT has achieved an all-time monthly record production of 21,284 tonne of FACTAMFOS at its Udyogamandal complex, company sources said. This is an all-time record since inception of these plants in the 1960s. In another milestone, the company also reached an all-time record in production of 7,042 tonne of Zincated FACTAMFOS in the complex during the same month.
NM Prabhakaran, public relations manager of FACT said that the Cochin division of FACT produced 56,656 tonne of FACTAMFOS during August 2016, to take the total monthly production to 77,940 tonne. For the company, this is a record in the last seven years.
The total fertiliser production in the company during August 2016, including 20,004 tonne of Ammonium Sulphate, has reached 97,943 tonne. This has helped achieve a cumulative production of 3.96 lakh tonne of fertilisers till August 2016.
On the marketing front, sale of 74,141 tonne of FACTAMFOS in August marked a record in the last 15 years. Also the cumulative sale of 2.91 lakh tonne of FACTAMFOS up to August marked a record in the last ten years.