Natural gas price hike hits APL

NAMRUP, March 18?The Assam Petrochemicals Ltd (APL), a pioneer enterprise engaged in manufacturer of methanol or ethyl alcohol and formalin, with natural gas as feed stock, has been gasping under the price hike of natural gas and power. APL is an Assam Government public sector undertaking (PSU), incorporated in 1971 with 88 per cent equity share of the government and 10 per cent of the IDBI. It started its commercial production of 21 TPD Methanol plant and 36 TPD formalin or formaldehyde plant in 1975. Since then APL has been galloping ahead, crossing several barriers like market crunch, competitions (etc. contributing crores of rupees per annum to the government exchequer by way of taxes and levies,offering direct employment toabout 530 people and indirect employment to 2000 (approx). APL expanded its methanol plant capacity by installing a grassroot 100 TPD plant in 1986 to cater the growng needs. The increasing demand for formalin by the plywood industries, prompted APL to install a 100-TPD new formalin plant which was commissioned in early 1998. The Supreme Court order of December 1996, banning of all forest based activities and running of saw mills of anykind, including veneer and plywood factories in North East, especially in Assam and Arunachal Pradesh, resulted in a sharp fall in the consumption of formalin,squeezing APL?s financial position to a great extent. This position of APL has been further aggravated by the downward trend of the international price of petrochemical products, coupled with the lower custom tariff, resulting availability of cheaper imported methanol, compelling APL to stand in the stiff?competition with the imported methanol.