Indian fertilizer plants switching to natural gas, could be market for Canada

| January 2, 2012 | 0 Comments

Northern Gateway pipeline key to tapping Indian markets

Indian fertilizer plants are switching to natural gas, partly out of concern for greenhouse gas emissions

 

As debate heats up in Canada about exporting natural gas to Asia from the West Coast, potential industrial customers in India are already switching to gas from fuels with higher greenhouse gas emissions.

 

 

Editor’s Note: The original version of this article incorrectly stated the Northern Gateway pipeline will carry natural gas. The article has been edited to remove the inaccuracies.

Natural gas has emerged as an economic and highly efficient fuel for various industries, causing demand to increase substantially across the world. A large number of fertilizer producers in India are changing their primary fuel and feedstock to natural gas, according to Industrial Info Resources, a Texas-based consultancy that tracks industrial construction projects around the globe.

Despite the fact India has major producers of natural gas, such as Reliance Industries Limited (Mumbai), Oil & Natural Gas Corporation Limited (New Delhi) and GAIL (India) Limited, much of the natural gas used in India is imported from the Middle East.

The Horn River shale formation near Fort Nelson, BC is estimated by Calgary-based Encana to contain as much as 500 trillion cubic feet of natural gas, 110 tcf recoverable, making it the third largest gas play in North America behind the Marcellus (Pennsylvania) 1,500 Tcf of gas in place and 262 Tcf recoverable; and, Haynesville (Louisiana and Texas)   717 Tcf gas in place, and 251 Tcf recoverable.

The Montney shale play, also in NE British Columbia, could hold even more natural gas than Horn River, up to 700 tcf and 20 per cent recoverable, according to the National Energy Board.

 

Natural gas emits significantly less greenhouse gases than either coal or oil. Source: Encana

 

Natural gas is considered the most suitable feedstock and fuel as it is less harmful to the environment and more cost-effective than naphtha, coal and low-sulfur heavy stock (LSHS). Natural gas as a feedstock and fuel has made a huge impact on petrochemical and power units, as it can also enhance production capacity of the end product by 13% to 18%.

Considering current environmental impacts, competitive markets and higher profit margins, National Fertilizers Limited (Uttar Pradesh, India) has planned to change feedstock for its existing fertilizer units from fuel oil and low-sulfur heavy stock to natural gas.

NFL is one of the largest fertilizer manufacturers in producing 3.7 million tons per year of urea and 2.15 million tons per year of ammonia from its four manufacturing units in Bathinda, Panipat, Nangal and Vijaipur.

NFL is also planning to restart a closed fertilizer unit of Fertilizer Corporation of India (Uttar Pradesh, India) at Ramagundam as a joint venture with Engineers India Limited (New Delhi, India) under the revival scheme of the government of India.

 

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Category: Business

About the Author (Author Profile)

Markham began his journalism career writing columns in the mid-1980s for Western People Magazine, then reported for a small Saskatchewan daily. He has spent most of his career in media and communications, likes to dabble in politics, was actively involved in economic development for many years, thinks that what goes on in the community is just as important as what happens provincially and nationally, and has a soft spot for small business (big business, not so much). Markham is a bit of a contrarian and usually has a unique take on the events of the day.

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