MoU signed for feasibility study of fertiliser plant

Kathmandu, July 13

Investment Board Nepal (IBN) signed a Memorandum of Understanding (MoU) with German-based DIAG Industries GmbH for the preparation of Detailed Feasibility Study Report (DFSR) for the establishment of chemical fertiliser plant (urea) in Nepal.

Chief Executive Officer of IBN, Sushil Bhatta, and Managing Director of DIAG, Benjamin Becker, signed the MoU.

A board meeting of the IBN on March 31 last year decided to issue a survey licence to DIAG based on the unsolicited proposal obtained from the latter as per the provision of the Public Private Partnership (PPP) and Investment Regulation, 2020.

Another IBN board meeting on April 13 this year endorsed the MoU to be signed between the two parties.

According to the MoU, DIAG Industries will have to submit the DFSR within 24 months following the issuance of the survey licence, the IBN informed in a statement on Thursday.

DIAG has the responsibility to select the appropriate technology from among natural gas, electrolysis (with carbon capture storage) or hybrid (both natural gas and carbon capture) during the study for production of at least 700,000 tonnes of urea per annum at a total initial estimated cost of USD 714 million.

The budget of the next Fiscal Year 2023/24 has announced to prepare a detailed project report (DPR) to establish a chemical fertiliser factory in the country, and the work will be carried out through PPP facilitated by the IBN.

CEO Bhatta underscored that a credible study is the key to de-risking the project and providing a sustainable implementation roadmap and urged the DIAG to submit a credible study with proper viability checks within the stipulated timeframe as prescribed in the MoU.

 Published in The Rising Nepal daily on 14 July 2023.