India: Tata Chemicals is Planning an Urea Plant in Gabon

Mumbai-based Tata Chemicals (TTCH), the world’s second-largest soda ash producer, in partnership with Singapore-based Olam International Ltd. (OLAM), is planning a $1.3 billion gas-based urea plant in the Republic of Gabon, in western  Africa. The project would be implemented through a joint venture called Gabon Fertiliser Company (GFC). Tata Chemicals will provide project management consultancy, and operations and maintenance service once the project will be commissioned. Olam is an integrated global supply chain manager and processor of agricultural products and food ingredients.

Tata Chemicals will acquire the stake from Olam and the Gabon government, which owns 20 percent of the project, expected to make 1.3 million metric tonnes of ammonia and urea a year, with a potential to double the output.

They already have signed the pre-construction services agreement with Technip S.A., which is a world leader in project management, engineering and construction in the energy and chemical industry. Technip will provide licensed technologies for the plant and project financing efforts. The project will be executed by Technip’s operating center in Paris (France), with support from the Rome (Italy), and Chennai (India), operating centers. Upon completion of the front-end engineering and detailed cost estimate, this contract can be seamlessly converted to a lump sum turnkey contract.

The project may generate more than $300 million in earnings before interest tax, depreciation and amortization a year. The plant output is planned both for domestic consumption and for export and it includes a 2,200 tonnes per day ammonia plant and a 3,850 tonnes per day granulated urea plant with self-sufficient utility and offsite units and product export facilities. The project reserves up to 25 per cent of the output for sale in Indian markets through Tata Chemicals network, subject to de-canalization in India. Commercial production is forecasted to begin in about two and a half years.

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