Brahmaputra Valley Fertilizer Corporation (BVFCL), a public sector fertiliser firm, is planning to set up a urea-ammonia plant in Assam.

The proposed urea plant will entail an investment of Rs 4,400 crore and will have a capacity of 8.64 lakh tonne per annum. It will be set up in partnership with Oil India (OIL) and the Assam government.

BVFCL and the Assam government will have 11 per cent equity each in the joint venture, while OIL will have 26 per cent stake. The remaining 52 per cent stake in the project will be awarded to either public or private parties through a bidding process.

The proposal has already received 'in-principle' approval of the Planning Commission, and the Board for Reconstruction of Public Sector Enterprises (BRPSE) has also recommended setting up the plant at Namrup, in Dibrugarh district of Assam. Based on the recommendation of the BRPSE, a note for the Cabinet Committee on Economic Affairs (CCEA) is under consideration.

The production cost at BVFCL’s existing urea plants -- Namrup-II and Namrup-III, is much below the international price of urea as these plants are situated in the North-East and thus get a gas price concession to the tune of 40 per cent.

At present India's urea production stands at 22 million tonne while its annual demand is about 30 million tonne. In the last decade there has not been any new urea capacity addition in the country.

Related Link:
Project Profile