The Fertiliser ministry has decided to abandon the ailing Haldia unit of Hindustan Fertilizer Corp (HFCL) in West Bengal and would soon approach the Cabinet Committee on Economic Affairs (CCEA) for its closure. “Keeping in view the number of urea plants already in pipeline in the country and the expected self-sufficiency in urea by the year 2021-22, the Haldia unit of HFCL may not be revived,” says a ministry note dated July 31. It says a proposal on the same had been prepared for CCEA approval.
West Bengal is ruled by Mamata Banerjee-led Trinamool Congress which is siding with the National Democratic Alliance’s (NDA’s) opposition party, the Congress.
The Haldia closure decision comes just three months after fertiliser minister Ananth Kumar promised the revival of all closed fertiliser projects under a two-pronged strategy to realise Prime Minister Narendra Modi’s vision of ‘Fertilizer Security for Food Security’.
On April 27, Kumar, after a joint review meeting on revival plans for closed fertiliser projects, said that the NDA’s two-pronged strategy was “existing fertiliser capacity augmentation by increasing the efficiency of the plants and revival of closed fertiliser projects”.
However, the fertiliser ministry’s July note is amply clear that HFCL would have to dismantle and dispose the plant and machinery at Haldia unit within this fiscal year with the help of MSTC Ltd and hand over the premise to Kolkata Port Trust (KoPT).
It said HFCL and KoPT would assess the value of the buildings and infrastructure on township land with the latter paying that assessment to HFCL. “Land would be handed over along with other superstructures after payment of costs based on the valuation certified by the government registered certifier (MSTC Ltd).”
Relief has been provided for Central government undertaking HFCL as it would have to pay a paltry Rs 1.82 crore as nominal lease rent accrued until March 2017 to KoPT with a waiver of increased rent, penalty and interest which would have raised the outgo to Rs 423.66 crore.
The NDA government hopes to raise the annual urea output by 7.5 million tonnes with the revival of mothballed units at Gorakhpur (Uttar Pradesh), Barauni (Bihar), Sindri (Jharkhand) and Talcher (Odisha) making India self-reliant in meeting the annual demand of around 32 million tonnes.
As part of the revival plan, it is extending a natural gas pipeline to the east, including a 2,650 km pipeline to Haldia from Jagdishpur under Pradhan Mantri Urja Ganga. It would provide gas feedstock to Gorakhpur, Barauni and Sindri plants while Talcher would use coal-gasification technology.
A consortium of state-run NTPC Ltd, Coal India Ltd and Indian Oil Corp will help revive the three units by means of special purpose vehicle through ‘nomination route’ since the earlier approved bidding route could not be carried forward because of poor response.
Interestingly, there is no functional urea unit in Eastern India except for two small units at Namrup in Assam. Tata Chemicals’ Haldia plant produces di-ammonium phosphate, NPK complexes, and single super phosphate.