SYRIA - The Fertiliser Sector.
Syria used to be self-sufficient in fertilisers but now its imports are costing the state about $120 million/year. The cost of three to four years of imports is equivalent to building a new fertiliser plant.
Running this sector are state-owned companies: the General Establishment for Chemical Industries (GECI), which produces phosphate fertilisers; and the General Fertiliser Company (GFC) which producers nitrogenous fertiliers.
With import substitution being one of the regime's main economic goals, the ministry of industry in 1998 invited the private sector to launch new projects in this sector. Private investment in the fertiliser industry is covered by Law 10 of 1991. Required were two projects: a plant to produce 500,000 t/y of triple superphosphate (TPS) to be located near Palmyra, prepared by GECI; a complex to produce 1,000 t/d of ammonia and 1,750 t/d of urea to be built in the east near the Euphrates River, prepared by GCF.
For the $400m TPS project, GECI in 1998/99 negotiated with two competing bidders: Dharamsi Mararji Chemical Co. (DMCC) of India and a consortium of SNC Lavalin of Canada, Tecnicas Reunidas of Spain and Simon Carves of the UK. A final government decision on the winner is yet to be taken as both bidders offered good options pertaining to the project's technical aspects and financing.
Usually it takes a long time for the government to decide on such matters. The Kuwait-based Arab Fund for Economic and Social Development (AFESD), among the possible financiers, has expressed concern over the repeated delays in getting this off the grand and the fact that an international project consultant for it has not been appointed.
Bids for the project were first made in 1992. The project was revived in early 1997. As the response was not encouraging, private participation was invited in 1998. The project was originally planned to be built by Bechtel and Makad International, an Oregon-based firm headed by Syrian-born American Elie Mouakad.
The TSP plant is to use phosphate feedstock from the Khunaifis mines, about 50 km south of Palmyra and 160 km south-west of Homs. GECI had reached an initial agreement on the project with Makad in February 1993, after the company agreed to build the plant for $250m. Makad had a deal with Raytheon Design and Constructors of the US to provide technology for the phosphate processing and for phosphoric acid and TSP production. It had set up a consortium with Bechtel for the plant. Work on basic design and engineering began in early 1994 and was completed in late 1997. But the Bechtel-Makad partnership dropped out in early 1998.
On Feb. 1, 1998, 'Al Baath' newspaper reported that India and Syria were holding talks about plans by Indian companies to invest $675m in projects to boost phosphate and fertiliser production, as well as to enlarge Syrian ports. One of the Indian companies involved was Aswal, whose Managing Director Anil Bhalla visited Damascus in February 1998.
Syria has substantial reserves of phosphate, a key feedstock for the fertiliser industry. The state company in charge of phosphate extraction is the General Establishment for Phosphate and Mines (GEPM). The government in 1998 announced a plan to boost the output of phosphate from about 2.6m t/y in 1997 to 4m t/y by 2000. It is not clear whether the plan has been executed. Apart from use for the local fertiliser industry, about 80% of the country's phosphate output is exported, mainly to Europe.
For GFC's nitrogenous fertiliser complex, an international tender in February 1998 was issued and companies were invited to submit integrated bids for the construction and operation of the ammonia and urea plants on BOOT basis. Companies were also invited to bid on the basis that the complex would be a joint venture with GFC. Initial plans called for the complex to be near the north-eastern town of Hasaka, to use almost 1 MCM/day of gas from the Omar field and 490 t/y of Euphrates water. Bids for the project were submitted by the June 16, 1998, deadline. But since then the government has not taken a final decision.
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|Publication:||APS Review Downstream Trends|
|Article Type:||Brief Article|
|Date:||Mar 13, 2000|
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