Nine ammonia projects were supposed to start up in 2015. Two succeeded.
OCI‘s debottleneck at Beaumont, TX, came on-stream in April 2015, and PotashCorp completed its expansion at Lima, OH, in October 2015.
So: in 2015, less than 200,000 mtpy of new ammonia capacity came on-stream.
Of the seven other projects slated for 2015, two were cancelled and the rest have been pushed into 2016.
| NEW AMMONIA CAPACITY | ON-STREAM IN 2015 | PUSHED TO 2016 | CANCELLED |
|---|---|---|---|
| BEAUMONT, TX | 35,649 mtpy | ||
| LIMA, OH | 160,243 mtpy | ||
| KEMPER COUNTY, MS | 19,958 mtpy | ||
| WEVER, IA | 876,000 mtpy | ||
| BEATRICE, NE | 52,980 mtpy | ||
| BRANDON, MB | 90,000 mtpy | ||
| GREENEVILLE, TN | 66,224 mtpy | ||
| BORGER, TX | |||
| PRYOR, OK | |||
| TOTAL | 196,243 mtpy in 2015 | 1,105,162 mtpy in 2016 | |
| Units: mtpy = metric tons per year. Data source: https://ammoniaindustry.com, as of 12/10/2015 | |||
The two cancelled projects …
Agrium decided in August that “the risk profile and the return profile didn’t make sense” for its ammonia expansion at Borger, TX. It is still moving ahead, however, with its urea brownfield for 2017.
LSB Industries has been talking about restarting a couple of ancient ammonia units at Pryor, OK, for some years (I estimated this project for 2015, arbitrarily). However, in March, the company said that they had been “looking at the economic cost of bringing those up to an acceptable level of reliability and output versus spending the same amount of money on the base plant … we can probably get a net better result by focusing on the main plant.” So, that project has now been “tabled.”
The long list of delays …
Koch‘s expansions at Brandon, MB, and Beatrice, NE, are both under construction, but start-ups have been pushed into 2016. Koch isn’t fond of publishing press releases (it hasn’t even bothered to announced the Beatrice expansion), but it still needs to disclose its plans in air permit documents. Both projects are now expected to be operational in the Spring.
US Nitrogen‘s small ammonium nitrate greenfield at Greeneville, TN, has stumbled through the myriad lawsuits and appeals and changes of plan – only to be hit with technical issues on start-up. The grapevine tells me we’re looking at Q1 or possibly even Q2 2016 for that to be fully operational. I’d make a joke about flogging a dead horse, but I’d probably get sued.
Mississippi Power‘s shiny new “clean coal” boondoggle in Kemper County, MS, features far and away the most egregious capex bloat of the field: from $2.97 billion to $6.5 billion in just four years, and still going up … but they promise it’ll be operational in 2016. Honest. I wrote a piece about the “clean coal” ammonia plants a short while back.
And finally, OCI‘s long-feted new world-scale greenfield at Wever, IA, was pushed back over the Summer for a start-up in Q1 2016. Wever is only $600 million above its original cost estimate (that’s ~43% above budget), and only a couple months behind schedule. That’s the first mover advantage for you.
These delays make 2016 even more transformative than we were expecting …
More than 5,000,000 mtpy of new ammonia capacity will come on-stream in 2016 – a full 25% capacity expansion across the industry in one year – but that’s another story.