RCF eyes Russia with mining activity plans

State-owned chemical and fertiliser company Rashtriya Chemicals and Fertilisers (RCF) is exploring the option of starting mining activities in Russia.

“Russia has ample reserves of potash. When Russian President Vladimir Putin visited India recently, we had exploratory talks for mining activities in Russia,” RCF Director (Finance) Suresh Warior told Deccan Herald.

The proposal, as and when it is approved, will be a joint venture with other government companies including NMDC, GNFC, FACT and Kribhco, Warior said, adding that the investments for the venture have not been calculated yet as the project is yet to be finalised.

According to the official, RCF will be setting up a urea plant in Iran soon after finalising its local partners. “We are looking at setting up a plant in Iran. We have identified SBI Caps who have identified 5-6 partners for the venture,” Warior said.

“Our team is likely to go to Iran soon and zero in on a likely partner. The total investment there is likely to be around Rs 7,000 crore-Rs 8,000 crore, out of which, our share is likely to be Rs 700 crore-Rs 800 crore. GSFC and GNFC are going to be partners in the project along with an Iranian company and RCF is likely to have around 16 per cent stake in the joint venture,” Warior said.

The company is looking at a capital expenditure of Rs 6,000-Rs 7,000 crore, over the next five years. Around 70 per cent of the funding for the capex will be through debt, while 30 per cent will be through equity.

As far as the funding for the projects are concerned, Warior said that the company would be looking at funds from Thal 3 as well as some bond issuances.

“Thal 3 is likely to start in around 3 years. We will utilise funds from the plant to fund our further capex,” Warior said. “We are also looking at raising around Rs 1,000 crore through bonds, but that is not likely to happen at least in the current fiscal,” Warior added.