KATHMANDU, JULY 13
Investment Board Nepal (IBN) has signed a memorandum of understanding (MoU) with German-based DIAG Industries GmbH to conduct a detailed feasibility study for the establishment of a chemical fertiliser plant (urea) in Nepal.
The MoU was signed by Sushil Bhatta, CEO of IBN, and Benjamin Becker, managing director of DIAG Industries GmbH, during a special programme.
In accordance with the provisions of the Public-Private Partnership and Investment Regulations, 2020, and based on the proposal submitted by DIAG Industries GmbH, the 50th meeting of the IBN held on March 31, 2022, decided to grant the study permit.
The draft of the MoU with the proposed company was subsequently approved by the 53rd meeting of the IBN held on April 13 this year.
As per the terms of the MoU, DIAG Industries GmbH is expected to submit the detailed feasibility study report to the Investment Board office within 24 months of receiving the permit.
DIAG Industries GmbH has proposed an annual production capacity of 700,000 tonnes of chemical fertilisers (urea) using either natural gas technology, electrolysis (with carbon capture storage), or a hybrid approach combining both technologies.
The estimated cost for establishing the chemical fertiliser plant with the mentioned technology and capacity is $714 million.
Furthermore, the budget for the upcoming financial year 2023-24 includes provisions for preparing a detailed project report related to the establishment of the chemical fertiliser factory in Nepal through a public-private partnership facilitated by the IBN.
During the MoU signing programme, the CEO of the IBN emphasised the importance of submitting a reliable feasibility study within the specified timeframe.
Such a study will provide a roadmap for project implementation and ensure sustainable operation with reduced risks.