RCF, SA firms to ink $1 bn pact for Mozambique unit

Font Size

Print

Feedback

Email

Discuss

Save & Share Article

What’s this?

Digg	My Yahoo	Fark
del.icio.us	Newsvine	Reddit

Rate This Article

Rating:  0

Amidst burgeoning fertiliser imports, state-run Rashtriya & Chemicals Fertilisers (RCF) along with Industrial Development Corporation (IDC) and Foskor (South Africa-based companies), plan to invest $1 billion to set up an ammonia, urea, phosphatic fertiliser plant in Mozambique. However, the three companies are yet to take a decision on their individual contribution.

Sources informed FE, “The three companies will soon ink a memorandum of understanding (MoU) in this regard. They will investigate the feasibility of setting up the plant at Maputo in Mozambique by sourcing rock phosphate from the Phalaborwa mines of Foskor in South Africa and natural gas from Mozambican gas fields. The companies will form a joint venture company for the proposed plant.”

According to sources, the trio would approach the Mozambique government for securing allocation of nature gas on priority basis subject to availability of new gas findings in Mozambique. They would enter into a formal understanding with the Mozambique government for providing infrastructure at a suitable location in Maputo in Mozambique.

Further, RCF, IDC and Foskor would induct a joint venture partner from the Mozambican side as may be proposed by the Mozambique government. They would jointly prepare a techno economic feasibility report and a detailed feasibility report. IDC and /or Foskor would jointly share 50% of the costs of the reports and the remaining 50% would be incurred by RCF.

RCF’s initiative is crucial when India’s fertiliser imports for 2007-08 shot up to around 10 million tonne, of which Urea’s imports are more than 5 million tonne.

Import of diammonium phosphate (DAP) went up from 0.86 million tonne in 2000-01 to over 3 million tonne in 2007-08. Potash is entirely imported.

The Fertiliser Associationof India noted that the widening gap between the production and demand has resulted in sharp rise in imports.