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                                                                 Exhibit 10.1.23


                            PERFORMANCE SHARE GRANT


                                                      Date of Grant: May 2, 2000
                                              Number of Shares Awarded: ________




Dear ___________:

     We are pleased to inform you that as a non-employee director of Terra
Industries Inc. (the "Corporation"), you have been granted, under the 1997 Stock
Incentive Plan (the "Plan"), the number of Common Shares of the Corporation set
forth above, subject to certain restrictions, terms and conditions set forth in
this letter and in the Plan.  The restricted Common Shares issued to you are
referred to in this letter as the "Performance Shares."

1.   From the date hereof until the restrictions on the Performance Shares
terminate (the "Restriction Period"), the Performance Shares shall not be sold,
exchanged, transferred, pledged, hypothecated or otherwise disposed; provided,
however, that any of the Performance Shares may be exchanged for any other
Common Shares that are similarly restricted.

2.   The Restriction Period shall terminate at the following times:

     a.  The Restriction Period shall terminate with respect to one hundred
percent (100%) all of the Performance Shares on the day any one of the following
occurs within two (2) years of the Date of Award: (i) any person or group of
persons acting in concert (other than Anglo American plc, and its affiliates or
a group consisting solely of such persons (the "Anglo American Affiliates"))
acquires beneficial ownership (within the meaning of Rule 13d-3 of the
Securities and Exchange Commission promulgated under the Securities Exchange Act
of 1934) of the outstanding securities (the "Voting Shares") of the Corporation
in an amount having, or convertible into securities having, 25% or more of the
ordinary voting power for the election of directors of the Corporation, provided
that this 25% beneficial ownership trigger shall apply only when the Anglo
American Affiliates no longer own 50% or more of the Voting Shares; (ii) during
a period of not more than 24 months, a majority of the Board of Directors of the
Corporation ceases to consist of the existing membership or successors nominated
by the existing membership or their similar successors; (iii) all or
substantially all of the individuals and entities who were the beneficial owners
of the Corporation's outstanding securities entitled to vote do not own more
than 60% of such securities in substantially the same proportions following a
shareholder approved reorganization, merger, or consolidation; or (iv)
shareholder approval of either (A) a complete liquidation or dissolution of the
Corporation or
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(B) a sale or other disposition of all or substantially all of the assets of the
Corporation, or a transaction having a similar effect.

     b.  The Restriction Period shall terminate with respect to one hundred
percent (100%) of the Performance Shares on the business day following the
second anniversary of the Date of Award.

The Corporation shall retain possession of the Performance Shares until the
later to occur of the termination of the Restriction Period and the termination
of the security interest described in Section 6 of this letter.

3.   If your service on the Board of Directors of the Corporation terminates
during the term of this agreement, all Performance Shares subject to the
Restriction Period shall automatically be forfeited by you and reconveyed to the
Corporation, except as follows:

     a.  If your service terminates by reason of death, the Performance Shares
shall continue to be eligible for vesting pursuant to Section 2 for a period of
one year from the date of death (provided that such vesting must occur, if at
all, on or before the second anniversary hereof).

     b.  If your service terminates by reason of Total Disability or retirement,
with the permission of the Personnel Committee, the Performance Shares shall
continue to be eligible for vesting pursuant to Section 2 (provided that such
vesting must occur, if at all, on or before the second anniversary hereof).

     c.  In cases of special circumstances the Personnel Committee may, in its
sole discretion when it finds that a waiver would be in the best interests of
the Corporation, extend the period for vesting or terminate the Restriction
Period with respect to all or a portion of your Performance Shares.

4.   This award shall not be effective unless you sign a copy of this letter and
deliver it to the Corporate Secretary of the Corporation, Terra Centre, 600
Fourth Street, Sioux City, Iowa 51101, on or before May 25, 2000.  If the
Corporate Secretary does not have your properly executed copy of this letter
before such time, then, anything in this letter to the contrary notwithstanding,
this award shall terminate and be of no effect.   Your signing and delivering a
copy of this letter shall evidence your acceptance of the Performance Shares
upon the terms and conditions of this Award.  Attached is a copy of your Stock
Certificate and Stock Power.  Your execution of the stock power will permit the
Corporation to enforce the security interest described in Section 6 of this
letter or reconvey the Performance Shares to the Corporation in the event the
Award is forfeited.

5.   Except as set forth in this letter, upon the issuance of the Performance
Shares you shall have all of the rights of a stockholder, including the right to
vote the Performance Shares and the right to receive dividends thereon.  The
certificates for any Performance Shares shall bear an appropriate legend
reciting the terms, conditions and restrictions applicable thereto, and shall be
subject to appropriate stop-transfer orders.  The Corporation shall issue your
Performance Shares promptly after the Corporation's Corporate Secretary receives
the documents set forth in Section 4, the

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Performance Shares have been listed (or authorized for listing upon official
notice of issuance) upon each stock exchange upon which the Common Shares of the
Corporation are listed and there has been compliance with such laws and
regulations as the Corporation may deem applicable. The Corporation agrees to
use its best efforts to effect such listing and compliance.

6.   You hereby agree to pay to the Corporation, or otherwise make arrangements
satisfactory to the Corporation regarding payment of, any federal, state or
local taxes required or authorized by law to be withheld with respect to the
award of the Performance Shares or the termination of the Restriction Period
(the "Withholding Taxes").  The Corporation shall have, to the extent permitted
by law, the right to deduct from any payment of any kind otherwise due to the
Employee, any Withholding Taxes and to condition the delivery of the Performance
Shares after the termination of the Restriction Period on the payment to the
Corporation of the Withholding Taxes.  You hereby grant to the Corporation a
security interest in the Performance Shares to secure the reconveyance of the
Performance Shares to the Corporation upon any forfeiture and to ensure adequate
provision for the Withholding Taxes.  The Corporation shall release its security
interest in respect of any Performance Shares on which (i) the Restriction
Period has terminated and (ii) all Withholding Taxes have been paid.  In lieu of
the payment of such amounts in cash, you may pay all or a portion of the
Withholding Taxes by (a) the delivery of Common Shares not subject to any
Restriction Period or (b) having the Corporation withhold a portion of the
Common Shares otherwise to be delivered upon vesting of the Performance Shares.

7.   The Corporation may, in its sole discretion, at any time or from time to
time, in lieu of the delivery of all or any portion of your Performance Shares,
pay to you cash equal to the Fair Market Value (as defined in the 1997 Stock
Incentive Plan) of such shares on the day the Restriction Period terminates.

8.   If any distribution is made to the holders of Performance Shares other than
a cash dividend and new, different, or additional shares or other securities of
the Corporation or of another company are received by the holders of the
Performance Shares, or if any recapitalization or reclassification, split-up or
consolidation of the Performance Shares shall be effected, or, if in connection
with a merger or consolidation of the Corporation or a sale by the Corporation
of all or a part of its assets, the Performance Shares are exchanged for a
different number or class of shares of stock or other securities of the
Corporation or for shares of stock or other securities of any other company,
then any such other securities shall be subject to similar restrictions as the
Performance Shares, and the number and class of Performance Shares, and the
restrictions, terms and other conditions applicable to any such other securities
shall be equitably determined by the Personnel Committee.

9.   Nothing in this Agreement shall confer upon the non-employee Director any
right to continue in the service of the Board of Directors of the Corporation,
or affect the right of the Board of Directors of the Corporation to terminate
the service of such Director, with or without cause.

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     These Performance Shares are awarded pursuant to the Plan and are subject
to its terms.  Capitalized terms used in this letter have the same meanings as
defined in the Plan.  A copy of the Plan is being furnished to you with this
letter and also is available on request from the Corporate Secretary of the
Corporation.

                                   Very truly yours,

                                   TERRA INDUSTRIES INC.


                              By:  _______________________________________
                                   President and Chief Executive Officer


                              By:  _______________________________________
                                   Senior Vice President, General Counsel
                                   and Corporate Secretary


I hereby agree to the terms and conditions set forth above and acknowledge
receipt of the 1997 Stock Incentive Plan and the Prospectus covering shares
issued under that Plan.


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Signature of non-employee Director

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