An earlier shipping contract between FACT and a Mumbai company for a period of 10 years ended in a CBI investigation. The company is planning to resume shipping ammonia by water.

They remain as ghost ships — the four barges that nearly sank the reputation of Fertilisers and Chemicals Travancore (FACT), once the titan among Kerala’s industries.

They swing gently as a swift afternoon wind sweeps in from the turbid waters of the Muttarpuzha, where they appear to have been buried over the past nine years after the news of a possible financial scandal broke out and investigations began.

But they are yet to pour out their entire story as a court case is pending and an arbitration process is on.

Recent reports of FACT’s decision to shift a part of the transport of its ammonia requirement by using National Waterway III calls back the late 1990s when FACT signed a contract with a Mumbai-based company for transport of ammonia from its Udyogamandal premises to Cochin division.

The fertilizer company has now signed a three-year contract with a Kochi-based company to transport ammonia both from Kochi port to the Cochin division and from Udyogamandal to the Cochin division. The transport of ammonia by water is about to resume after a gap of nine years.

The shipping contract between FACT and the Mumbai company for a period of 10 years, effective from April 1998, ended in a CBI investigation. The prosecution termed the contract exorbitant at Rs. 1,550 per tonne. The prosecution alleged a loss of Rs.78 crore to the fertilizer company on account of the exorbitant transport cost. Company insiders pointed out that towards the end of the contract, as the scandal was breaking out in 2004, the FACT was paying about Rs.1,640 per tonne.

In contrast, the new contract has been signed for a payment of Rs.274.50 per tonne of ammonia transported from Udyogamandal to Cochin division.

RELATED NEWS

Waterways are the way to go, but not for KeralaSeptember 25, 2013

More In: Kochi