India's Deepak Fertilisers and Petrochemicals Corp has put on hold a planned $350 million ammonium nitrate manufacturing project in Australia, a company executive said, citing environmental, technical and economic factors.

The project, announced last year, had faced local opposition on concerns over possible harm to nearby cuttlefish populations and did not get past the planning stage.

Deepak Fertilisers wanted to set up a 300,000 tons a year plant to make technical ammonium nitrate (TAN), a chemical used in coal mining, near Port Bonython in the state of South Australia.

The company, based in the western Indian city of Pune , is exploring options to find another site in Australia, Chief Financial Officer Somnath Patil told Reuters by phone on Wednesday.

"There are other angles (as well as environmental issues) ... like techno-economic angles that we are looking at," Patil said. "As of now, there is no great progress on this front."

Australia, abundant in coal reserves, is a key market for TAN manufacturers. The country has offered a number of coal blocks over the last two years to companies including India's GVK Power & Infrastructure and Adani Enterprises .

"We have done some studies and there is demand-supply gap (for TAN) in Australia," Patil said.

Deepak Fertilisers, which also makes complex fertilizers, industrial chemicals and runs a retail mall, has been exporting small volumes of TAN to Australia from its Indian plant, he said.

"We need to see if the selling prices there will be able to support that kind of an investment," he said.