Muscat: The government of India has agreed to increase the price of urea imported from Oman India Fertiliser Company (Omifco) in order to compensate for a hike in natural gas price by Oman government. "We have already reached an agreement with the government of India for compensating the escalation in input cost," S.G. Gedigeri, Deputy CEO of Omifco, told Times of Oman.
He said that the urea price has been increased by $17-18 per tonnes to $150-160 per tonne, which is effective from the date of revision in natural gas price earlier this year. "Therefore, the hike in natural gas price will not affect the company's revenue or profit." Oman government has substantially increased the price of natural gas supplied to the Sur-based Omifco.
Gedigeri said Omifco's urea production is projected at around 1.9 million tonnes this year, which is slightly lower than last year's two million tonnes output. "This was due to unplanned shut downs as the plant is getting little bit old." He said that the urea price in the international market has dropped this year to around $340-$360 per tonne, from $450 a tonne last year.
The $960 million-Omifco ships around two million tonnes of urea, which is its entire production, to India under a buy-back agreement the country has with the Oman government. Indian Farmers Fertilizer Cooperative and Krishak Bharati Cooperative own 25 per cent each in Omifco. Oman government's investment arm, Oman Oil Company, owns the remaining 50 per cent.