India, Ghana entering into another level of talks over $1b urea plant

This week will see Ghana and India entering into another level of negotiations over the establishment of the $1 billion urea project to be sited in the Shama district of the Western Region.

The major problem hindering the start of construction of the project has always been the pricing and the constant supply of gas to the project if completed. Gas supply is expected to come from Ghana.

India will be holding a three-day trade show in Ghana starting from Monday July 9, 2012 and is expected that top Indian government officials will be in the country to hold discussions with the Ghana government over the urea plant.

Ahead of the talks, the Indian Economic Times, citing officials, reports that India is likely to ask Ghana to provide assured gas supply at competitive rates to the proposed $1 billion urea project to be executed by the Rashtriya Chemicals & Fertilisers Ltd (RCF).
The RCF is India’s largest urea maker and its proposed plant in Ghana has the capacity to produce one million tonnes of the product per annum.

“There is an issue of gas pricing for the project. The matter is expected to be taken up by Commerce and Industry Minister Anand Sharma during his meeting with Ghana Trade and Industry Minister Hannah Tetteh tomorrow,” an official told the Economic Times adding that “the gas price negotiations are pending and are key to the viability of the project.”

India’s Fertiliser Secretary, Ajay Bhattacharya, who is accompanying Sharma, would discuss the issue with Ghana government officials.

The urea plant is expected to be commissioned by 2016-17 if all hurdles are cleared.

By Ekow Quandzie