CCEA approves policy to convert existing urea units to use Gas

The Cabinet Committee on Economic Affairs has approved a policy to encourage the conversion of gas. The new policy provides for a Special Fixed Cost towards reimbursement of the cost of conversion to the urea unit after its conversion to gas is completed. The conversion of these units will lead to increase in efficiency of urea production in the country and also add to usage of natural gas, which is the most efficient and cleaner fuel / feedstock for production of urea in the country.

It also approved a special dispensation under New pricing Scheme, Stage-III, to enable restart of production of urea from the Trombay-V unit of M/s. Rashtriya Chemicals Limited which has remained closed for last more than 4 years. The restart of RCF Trombay will add to indigenous production of urea and reduce import dependence towards meeting the requirement of urea in the country.

It has also approved restart of existing Naphtha based units which are under shutdown, on naphtha, provided they convert to gas before March 2010, as is necessary for other operational Naphtha based units.

The above decisions will add to indigenous production and add efficiency in production.

Source : Equity Bulls

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