Iran: Oman to Withdraw from the Nitrogen Fertilizer Project in Assaluyeh

Oman refused to continue with the project to build a petrochemical plant in southern Iran after a dispute about the price of raw materials. The deal to construct the plant in the southern port town of Assaluyeh, was signed between the two countries in August 2009. Iran expected the Hormuz plant, which requires an investment of over USD 500 million, to produce one million tonnes of ammonia and 650,000 tonnes of urea annually. Iran is targeted by international sanctions because of its proved attempt to get military nuclear capabilities, but the Iranian authorities tried to deny that the Oman’s decision was triggered by the imposition of international sanctions against their country. The Oman decision is a serious blow to the project, which was to be financed on a 50-50 basis by both sides.

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