KOLKATA (ICIS)--Indian Farmers’ Fertiliser Cooperative (IFFCO) and La Coop Federee have firmed up a production sharing agreement for their proposed 1.6m tonne/year urea plant to be constructed in Quebec, an official in department of fertilizers said on Friday.
As per the agreement, La Coop Federee would buy 500,000 tonnes/year of urea from the proposed plant to be distributed across markets in Canada and US while the balance would be shipped to India by IFFCO, the official said.
The Canadian subsidiary of IFFCO which would be implementing the urea project was formally approved by the provincial government of Quebec on 19 April 2014, he added.
The IFFCO board would now finalise the project financing and negotiate the equity participation of La Coop Federee, the Montreal headquartered agro-food cooperative conglomerate, the official said.
Last year, IFFCO’s Canadian subsidiary had acquired land for the project at the Becancour Port and Industrial Park. The deep-water port facility would offer the option to market urea in Europe the excess production after meeting off-take commitments to La Coop Federee and Indian domestic demand, he said.
IFFCO’s Canadian venture was crucial since the Indian fertilizer producer was hamstrung in expanding capacities in the country in view of shortage of feedstock and such plans for its plant at Kalol in western Indian province of Gujarat had to be scrapped, he said.
The Canadian plant would be IFFCO’s second overseas urea production facility after one in Oman other than three in India with current total production capacity of 8m tonnes/year.