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IBN signs MoU with Malaysian company for chemical fertilizer factory



IBN and Malaysian company sign MoU for feasibility study of chemical fertilizer factory in Nepal, 2023
IBN and Malaysian company sign MoU for feasibility study of chemical fertilizer factory in Nepal, 2023 (Photo: IBN)

Kathmandu, Sept 27: The Investment Board, Nepal and a Malaysian company have signed an Memorandum of Understanding for conducting a feasibility study for establishment of a chemical fertilizer factory in Nepal.

IBN Chief Executive Officer Sushil Bhatta and reNikola Sdn. Bhd.’s Managing Director Bomhidi Abdelali signed the contract from their respective sides amidst a programme on Wednesday. reNicola is a Malaysian company.

Issuing a press release, IBN shared that the MoU was reached to establish a factory of chemical fertilizer- Green Calcium Ammonium Nitrate (CAN). As per agreement, reNicola is obliged to submit a Detailed Feasibility Study Report for Establishment of Green Calcium Ammonium Nitrate (CAN) in Nepal within 24 months of agreement.

The chemical fertilizer factory would be established at Abukhaireni of Tanahu district based on electrolysis technology to produce Green Ammonia and Green Calcium Ammonium Nitrate (CAN).

The proposed factory would be established at a cost of nearly 260 million US Dollar, and it can produce 95,600 metric tons of Green Ammonia and 286,975 metric tons of Green Calcium Ammonium Nitrate (CAN) annually.

At the signing ceremony, CEO Bhatta hoped that the new green technology will be able to use Nepali electrical resources and help for the promotion of green economy. He also requested the Malaysian company to suggest detailed operation modality for the sustainability of the factory as well.

The government is planning to establish such factory on the basis of public private partnership. The IBN Board has also given approval for the public private partnership to establish chemical fertilizer factory in Nepal.

Nepalese farmers have to struggle to get fertilizers every year. The past governments have repeatedly vowed to establish chemical factory in Nepal but failed to do so. Nepal have been facing the reliable electricity supply and fund management.

Proposed Chemical Fertilizer Projects

1. June 18, 2020 : DIAG Industries GmbH Germany submitted an unsolicited proposal to develop the fertilizer project. The IBN has a policy of developing chemical fertilizer factories on the basis of Public Private Partnership model. According to an estimate on 2022, the project may cost around 714 million US Dollar. The factory can produce 701,250 metric tons of chemical fertilizer annually. The DIAG has proposed to establish factory in Bardaghat, Nawalparasi district.

2. April 10, 2022 : The IBN Board decided to issue a licence for the study of the Chemical Fertiliser Project in Nepal.