Iffco to undertake rock phosphate mining in Australia

New Delhi: Indian Farmers Fertiliser Cooperative Ltd (Iffco) will invest around $800 million for undertaking rock phosphate mining in Australia.

The farmers’ co-operative has signed a ‘Principles of Off-take Agreement’ with Legend International Holdings of Australia to undertake joint mining of rock phosphate in Legend’s mines along with an assured three million tonnes (mt) annual offtake by Iffco.

The rock phosphate procured from the Australian company will be utilised as raw material for the co-operative’s di-ammonium phosphate plant in Paradip.

Iffco will invest around $800 million in a phased manner to acquire 45 million shares in the Australian company and will provide technical and logistical support to develop Legend’s mining operations and shipment of its product to India. The Iffco Managing Director, Dr U.S. Awasthi, has joined the board of Legend International, the co-operative said in a release.

Initially, Iffco would acquire 15 million shares in Legend International Holdings. It would also receive options for another 30 million shares to be acquired in a phased manner. The fund would be used to meet capital expenditures related to the project.

According to the agreement signed between Iffco and Legend, the price at which Iffco will buy rock phosphate from the Australian company would be decided based on market benchmark prices for significant volumes of international supply agreements to the Indian buyers. An alternate price mechanism, based on international phosphoric acid price, has also been incorporated, the release added.