FACT will resume production of ammonia within a month.
The ammonia plant which had been shut down for 11 months, will be reopened, Jaiveer Srivastava, chairman and managing director of the company, said at a press conference here on Thursday. The caprolactum plant, which was shut down over two years ago, will resume operations after the ammonia plant resumes production.
The decision was taken after the State government announced waiver of value added tax (VAT) on liquefied natural gas (LNG) consumed by FACT.
The current value added tax rate on LNG is 14.5 per cent. Mr. Srivastava said exemption of LNG from VAT will help bring down its price to about $13.47 per unit, measured in million matric British thermal units (mmbtu).
Mr. Srivastava said that production of Factamfos, which was limited to 60 per cent of its capacity due to shortage of ammonia, would be increased as more ammonia would be available from renewed operations.
He said that about Rs. 7 crore would be required for restarting the caprolactam plant.
There has been substantial fall in the price of Benzene, one of the main raw materials used in the production of caprolactam. It would also be beneficial to the operations of the caprolactum plant.
He hoped that the present developments would enhance the financial strength of the company.
Replying to a question about the State government’s request for 150 acres of FACT land for putting up a power plant, he said that it was a matter to be decided between the central and State governments.