Iran has offered to supply natural gas at $2.95 per mBtu for a urea plant that India will set up at the Chabahar port on the Iranian coast, Shipping Minister Nitin Gadkari said on Wednesday.
"Iran is offering gas to India at $2.95 per million British thermal unit (mBtu) to set up urea plant at the Chabahar port in Iran. India is negotiating the gas price and has demanded it at $1.5 per mBtu rate," he said at an event here on modernisation of major ports.
The minister said that the actual size of the project would depend on the negotiations with Iran.
"India is ready to invest more than Rs.1 lakh crore, but that depends on negotiations with Iran," he said.
"India is ready to make huge investments in Iran. If urea plant is set up, it will result in slashing of urea prices in India by 50 percent and cut on huge subsidy on urea, which is Rs. 80,000 crore," he added.
Regarding the development of the Chabahar port, Gadkari said: "Various ministries will give their report by September 28, based on which a final decision will be taken."
In May, Gadkari signed an MoU for the development of Chabahar port project during his visit to Iran.
As per the $85 million deal, India will help build the second and third terminals at the port, including the construction of the railway line connecting the port with the rest of Iran.
This project is expected to become operational by December next year.
On the modernisation of Indian ports, Gadkari said the target is to enhance mechanisation to 80 percent from 60 percent now, and the average turnaround time to less than 2 days from the current 4 days.
Cargo handling capacity of the 12 major ports has also been targeted to be raised, he said.
