Solid Energy and fertilizer company Ravensdown, in an attempt to make optimum use of Southland's vast lignite resources, has been looking into the feasibility of setting up a lignite-to-urea plant in eastern Southland, by investing around NZ $1.4b. The plant is being considered one step forward for making the country sufficient in Urea, a common Nitrogen fertilizer used for grass growth.

The export potential of Urea is also being looked into, with the hope of handsome earning from Urea exports. Ravensdown has been looking for appropriate location for the plant with estimated production capacity of up to 1.2m tonnes a year.

Rising global prices of urea also necessitates the need of such plant which could generate about $1.5b a year through exports, besides creating more than 500 new jobs in the region.

Ravensdown is expected to conclude the investigation study by early next year, for paving the way for building the plant by 2012 and to make it operational by late 2014.

Solid Energy Chief Executive, Dr Don Elder, while highlighting the importance of Urea, said: "Solid Energy is already investigating a range of options for managing CO2 emissions from our planned coal-to-lignite plant, including carbon capture and storage, bio-sequestration and bio-feedstock options."