INDO EGYPTION FERTILIZER COMPANY SAE a joint venture of Indian Farmers Fertiliser Cooperative Ltd., India and El Nasr Mining Company , Egypt May 2006
About IFFCO • Indian Farmers Fertiliser Cooperative Limited (IFFCO) incorporated as a multistate cooperative society in India is the largest fertiliser producer in India. • Owned by more than 38000 cooperative socities representing about 55 million farmers. • Annual Production of 6.4 million tones fertilisers in the year 2005-06. • Annual Sales of 8.2 million tones in the year 2005-06 • 20% market share of nitrogenous and 25% market share of phosphatic fertilisers in India. • Annual turnover for the year ending March 2006 is over US$ 2.2 billion and profit of US$ 107 million • Networth as on 31st March 2006 US$ 790 million
About IFFCO Major Joint Ventures • Industries Chemique du Senegal (ICS), Senegal • Indian Potash Limited, India • IFFCO-Tokio General Insurance Company Ltd , India • Oman-India Fertiliser Company, Oman • National Commodity and Derivative Exchange Limited, India • National Collateral Management Services Ltd, India • Godavari Fertilisers and Chemicals Ltd., India
About ENMC • El Nasr Mining Company (ENMC) is the largest mining company in Egypt under Metallurgical Industries Holding Company. • ENMC is the main miner, supplier and exporter of rock phosphate in Egypt. • Owns Rock phosphates mines in eastern and western Sabaiya deserts besides other minerals all over Egypt. • Owns Hamerawein port at Red Sea. • Exports about 1.5 million tones of rock phosphate yearly in addition to supplies in domestic market.
Project Highlights • Location : Eastern desert at Sabaiya near Edfu, Aswan, Egypt adjacent to Rock Phosphate mines/ works of ENMC • Main Product : Phosphoric Acid 1500 tones per day (P2O5) • Intermediate Product : Sulphuric Acid 4500 tones per day
Project Highlights KEY REQUIREMENTS • Rock Phosphate : About 2 million tones per year • Sulphur : 0.5 million tones per year • Production of Phosphoric Acid : 1.0 million tones (Bulk) per year • Water : 15000 cubic meters per day • Power : Captive Generation of 25 MW
Project Highlights • Capital Investment : 325 million US$ • Debt equity ration 70 :30 • Shareholding Pattern : IFFCO/Affiliates 76% ENMC 24%
Project Highlights • Port facility required for import of Sulphur and Export of Phosphoric Acid • Railway Net work required to be improved for transportation of Sulphur and phosphoric Acid from/ to port
Strategic Partnership • ENMC shall supply about 2 million tones of rock phosphate to the project from its mines at Sebaiya on long term basis • IFFCO will off-take the entire phosphoric acid production for exports.
Pre-Project Mile Stones • Conceptulisation for investment : December 2004 • First Visit to Egypt : December 2004 • Identification of the JV Partner : January 2005 • MOU with El Nasr Mining Co. : April,2005 • Approval for Investment in : May,2005 Project under Private Free Zone by General Authority for Investment & Free Zones (GAFI) • In Principle allocation of Land : May 2005
Pre-Project Mile Stones • Signing of Share Holders Agreement : October 2005 • Incorporation of JV Company :November 2005 • First Board Meeting & Share Holders Meeting :November 2005 • EIA by CAPSCU, Cairo University :November 2005 • Environmental Clearance : January 2006 • IFC appointed as finance facilitator and consultant : February 2006 • IFC team visited the site : March 2006 • Testing of Rock Phosphates : March 2006 • Established Head Office of the Company in Cairo : March 2006
Pre-Project Mile Stones • Appointed Ardaman Associates for Basic design of Gypsum disposal site : March 2006 • Geo Technical Study by by Dr. Fathi M.Abdrabbo, Alexandria University : April 2006 • Technical Study Report by PDIL : April 2006 • Logistics Study by CAPSCU, Cairo University : May 2006
Schedule Pre-Project Activities • Social Impact Assessment as per IFC guide lines by Centre for Environmental Researchand Studies (CERS) Cairo University : June 2006 • Finalisation of Plant Layout : June 2006 • EIA for Crushing Unit of ENMC by CERS, Cairo University : July 2006 • Finalisation of Logistics Plan : June 2006
Schedule Pre-Project Activities • Finalisation of consultant for EPC Contract : October 2006 • Signing of financing agreements :September 06 • Financial Closure :September 06 • Zero date of the Project : 01/10/1006 • Completion of the Project : 31/09/2009
Benefits of the Project to Egypt • Foreign direct investment of about US$ 325 million • Net foreign exchange inflow of over US$ 2 billion over 20 years of plant operation. • Substantial value addition to Egyptian rock phosphate reserves. • Placing Egypt on the international Phosphoric acid Map. • Boost to local economy. • Boost to development of ancilliary industries to support the plant. • Direct employment of local population • Substantial indirect employment for plant construction , transportation and support functions.
Areas of Concern • Railways/ roadways upgradation to facilitate transportation of phosphoric acid to the port and Sulphur from the port to the plant . • Port upgradation for additional solid and liquid handling requirements.
Suggestions • Upgradation of Railways on Fast Track • Upgradation of Ports on Fast Track • Land Acquisiton – on Fast Track • Creation of a Pool of Consultants in GAFI in the areas of Legal, Taxation, Finance, Human Resource etc. • Defining a Nodal Officer in important Ministries for coordination with GAFI / Investors. • Creation of Business Centre type facilities in GAFI for new Investors. • Pursuance of Strategic Investors abroad. • Simplification of procedures for establishment of Offices, Telephone Connections, Work Permits, Residence Visas etc.