The Rs 100-crore expansion project of Iffco's Phulpur plant is all set to be commissioned before 1997 end, a month ahead of schedule, but is likely to face a short supply of naphtha.

Executive director of the plant Daya Krishna Bhatt said the existing plant itself is facing problems in getting its required naphtha supply due to Indian Oil Corporation's inability to arrange adequate railway wagons. The situation is likely to deteriorate after the completion of the expansion programme.

"We would require about two and a half times more naphtha than the present requirement from November onwards. We are in a hand to mouth situation now and the problem may deteriorate further", he said.

After expansion the plant would require about 2,000 tonnes of naphtha per day as compared to the present need of about 800 tonnes per day.

The situation has worsened following the temporary shut down of Mathura oil refinery, which is the principal source of naphtha for the unit, which has now to depend on distant refineries in Haldia and Barauni to meet its demand.

With a view to overcoming the situation, Iffco has planned to procure rail wagons under own-your-wagon scheme and leasing them to IOC for the transportation of naphtha, Bhatt said.

Bhatt said discussions are on among railways, IOC and Iffco for procuring at least two rakes.

As one railway rake can carry about 2,000 tonnes of naphtha, Iffco would require at least four rakes for efficient supply taking into consideration loading, unloading and movement factors, he said.

Asked whether delay in naphtha supply could lead to closure of the plant, he said, "we won't allow such a situation but under the present circumstances it may arise any day. We have to do more follow up work with railways and IOC to solve the problem.

Iffco, Bhatt said, is now monitoring stock level of naphtha on a daily basis.Though the new plant will have the facility of utilising gas as an input, branching of one pipeline from HBJ pipeline at Jagdishpur, about 150 km from Phulpur, will not be a cost-efficient solution, he said.

"We are not considering this option as laying of gas pipe line is not a viable solution besides being very expensive", Bhatt said.

Iffco Phulpur unit is required to meet the urea demand of the eastern states following the closure of some fertiliser units and low-capacity utilisation of the few existing plants in the region.

Iffco rules out move to divest govt's equity

The is no proposal with the government regarding offloading of shares by fertiliser cooperative giant -Iffco, chemicals and fertiliser minister M Arunachalam on Sunday said.We have not received any such proposal from the government and nothing of this sort was discussed at any meeting,'' M Arunachalam told PTI.

It was reported that Iffco had planned to return entire Rs 289.6 crore equity of the government to avoid its interference in every aspect of the operation and would seek changes in the multi-state co-operative societies act.``There is no need of any such move as Iffco and Kribhco are working quite well,'' the minister said.Iffco and Kribhco were formed under the Cooperative Societies Act 1984 and Companies Act of 1956 and without amending these acts, Iffco cannot come out of the purview of the government.When contacted, Iffco's managing director U S Awasthi also denied the report.

Copyright © 1997 Indian Express Newspapers (Bombay) Ltd.