Leading fertilizer manufacturers of the country including Engro fertilizers have committed to invest around $300 Million in Gas Pressure Enhancement Facilities (PEF) project from Mari network to sustain domestic urea production levels. The project has been initiated to improve the gas supply from the Mari Network for an uninterrupted gas supply and smooth urea production. The project is expected to complete in the next 18 months and the estimated share of Engro Fertilizers in this project is over $100 million.
Ali Rathore, Chief Financial Officer, Engro Fertilizers said that removal of subsidies for fertilizer manufacturers on SSGC and SNGPL network, which represents 60 percent of all fertilizer manufacturing capacity, is a step in the right direction. While gas prices for SSGC and SNGPL network have increased by around 200 percent, the manufacturers on Mari network (FFC and Fatima) are still receiving gas on the subsidized price of PKR 580/mmbtu. A homogenous gas price will create a level-playing field for all fertilizer manufacturers in terms of input costs and help stabilize urea prices in the country.
Currently in early 2024 the urea prices of FFBL, Engro Fertilizers and Fauji Fertilizer Company Ltd stand at Rs 5,489 per bag, Rs 4,649 per bag and Rs 3,767 per bag, respectively.
