GAIL India may throw lifeline to Matix Fertilizers and Chemicals
Matix Fertilizers and Chemicals is banking on GAIL India’s Pradhan Mantri Urja Ganga pipeline for restarting its idle coal-bed methane-fired fertiliser plant in West Bengal and escape insolvency resolution. The company, promoted by the Datamatics Group, which started defaulting on its Rs 4,305 crore loan exposure was recently dragged by IDBI Bank to the National Company Law Tribunal and rated defaulter by rating agency CARE. The Rs 7,000 crore plant has been lying closed for want of feedstock. “By July we would be able to take the Urja Ganga pipeline to Matix’s plant from where they would be able to get both natural gas as well as the coal-bed methane being produced by Essar at Ranigunj,” S Biragi, chief general manager (marketing), GAIL India, said. The greenfield 1.27 tonne a year urea and 0.73 million tonne per ammonia plant need 2.4 million standard cubic metre of gas a day, which was supposed to come mostly from Essar Oil and Gas Exploration and Production. The CBM production reportedly fell short of Matix’s requirements while Essar officials had maintained that Matix’s own production wasn’t stabilised, and the company had even supplied CBM for pre-commissioning activities of Matix. With the pipeline now turning into reality, production would now be scaled up by Essar. “Last year, CBM development received a huge leverage with the gas marketing freedom, which has given CBM players LNG import parity price for commercial development of CBM. The other crucial factor is the commissioning of the Urja Ganga pipeline, which we are confident GAIL would implement before July. We are now synchronising our production ramp-up plan from our Raniganj East block to meet our commitments to GAIL,” Vilas Tawde, managing director & chief executive officer, Essar Oil & Gas, Exploration & Production Ltd, told DNA Money. The Matix plant, however, need both the gasses, conventional natural gas as well as CBM, together to run optimally. “The plant can’t run on a continuous basis with 50% of the fuel requirement,” Biragi said. The pipeline would pick coal bed methane from Essar’s operating field at Ranigunj along the way, and would be able to reach Matix’s plant near Panagrh before reaching Haldia near the Bay of Bengal by December, the GAIL official said on the sidelines of a conference on gas sector organised by industry body Ficci.