SPIC to restart Tuticorin fertlisers plants

CHENNAI - Fertiliser maker Southern Petrochemicals Industries Corporation (SPIC) will soon start its Tuticorin ammonia and urea plants as it is confident of getting natural gas to power the plants, a top group official said Wednesday.

“The company will soon start operations using naphtha and later switch over to natural gas once it is available,” SPIC Group Chairman A.C. Muthiah told reporters on the sidelines of a media event here.

To the question where from the company would get the gas, he said: “We can get it from the gas available in Ramnad district in Tamil Nadu, LNG (liquefied natural gas) terminal from Cochin (built by Petronet LNG), Reliance Gas from Kakinada and LNG terminal at Ennore (proposed by Indian Oil Corporation).”

As the government has decided to pay fertiliser companies subsidy based on natural gas plant cost, fertiliser plants have to be converted into gas plants in order to be viable.

“We can convert our plant only when we get the gas allocation. We are confident of getting the full subsidy even if our plant uses naphtha. We have three years time to shift to gas,” Muthiah said.

Declining to comment on the probable date of restarting the plant that was shut down in 2007, he said: “It will start soon. We will take you all there for that.”

The plant was supposed to be commissioned in May this year but owing to some equipment problem it got delayed.

“Our immediate focus is on addressing the financial issues,” he added.

The company has run up a debt of around Rs.2,800 crore and bulk of it is now with Asset Reconstruction Company (India) Ltd (ARCIL).

Last fiscal the company sold its holdings in its overseas subsidiary Indo-Jordan Chemicals Company, joint venture outfit Technip India and wholly owned subsidiary Indital Chemicals.

The promoters have infused Rs.50 crore into the company.

Queried about the group’s plans to get into power sector he said: “We will be putting up a 525 MW plant on the Tuticorin belt. We have the land and environmental clearance for the purpose.”

He said SPIC Electric Power Corp’s land dispute with Neyveli Lignite Corporation Ltd (NLC) is settled now.

–Indo Asian News Service