Category: Capacity Expansion Updates

AdvanSix updates at Hopewell

Now that Honeywell has spun off its Resins and Chemicals division into the standalone AdvanSix Inc, we finally have some corporate transparency about plant operations.

In its first independent announcements over the last two weeks, notably including an operational update and its Q3 2016 earnings report, AdvanSix has provided lots of details of its financial and operational performance, and specified - for the first time - the plant's ammonia capacity.

Also, we learned that the planned turnaround in the fourth quarter was extended by two weeks of unplanned maintenance, which will hit Q4 2016 earnings to the tune of $20-25 million.

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The Water Intensity of Ammonia

Agrium continues to plan for the potential restart of its ammonia-urea plant in Kenai, Alaska: its draft water permit is now entering a 30-day public comment period.

However, the fact sheet for the draft permit contains one particularly interesting chart, which follows below, to illustrate the water flows throughout the ammonia-urea plant. In an industry that holds its data close, this is a refreshingly detailed flow chart.

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POT+AGU merger is on

The merger of equals between PotashCorp and Agrium was confirmed to be moving ahead this morning, in a press release announcing their boards' unanimous approval of the plan "to Create a World-Class Integrated Global Supplier of Crop Inputs."

"A new parent company will be formed to own both companies. PotashCorp shareholders will receive 0.400 common shares of the new company for each common share of PotashCorp they own, and Agrium shareholders will receive 2.230 common shares of the new company for each common share of Agrium they own."

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US Nitrogen shut down “under federal and state investigation”

The grand SNAFU named US Nitrogen appears to have come to a temporary pause.

Despite starting up all the units over the last few months - nitric acid, ammonium nitrate, ammonia - the regulatory teams at state and federal levels overseeing US Nitrogen now appear to have come in and closed the site down, until they can enforce environmental and safety standards.

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US Nitrogen start up, in violation

US Nitrogen hasn't publicly announced that its new ANSOL plant is operational, yet, but it has advised regulators that the plants have started up. Its reps are telling the local press that it will be operational by "the end of summer."

In the meantime, the team is rectifying a newly-identified spate of permit violations and deficiencies - which is a little awkward, because regulators are presently considering its permit renewals, which met with great resistance from the local community during the public comment period.

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CF-OCI merger cancelled

CF Industries terminated its proposed merger with OCI this morning.

"The Treasury announcement on April 4, 2016 materially reduced the structural synergies of the combination. Since that time, both companies have worked together collaboratively ... However, the companies were unable to identify an alternative acceptable to both parties and, therefore, agreed to terminate the combination."

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Waggaman update: on schedule, on budget, expected Q3

It's refreshing to write an update for a plant where construction is on schedule and on budget, which appears to be the case at Dyno Nobel's ammonia brownfield at Waggaman, LA.

Recently, we've seen delays, cost-overruns, and lawsuits aplenty for projects like US Nitrogen at Greenville, TN, OCI at Wever, IA, and LSB Industries at El Dorado, AR.

But Dyno Nobel's parent company, Incitec Pivot, described progress quite differently during this week's earnings call:

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LSB Industries is selling its climate control business

LSB Industries will soon be a pure-play nitrogen producer. It announced this morning that it "has entered into a definitive agreement to sell the Company's Climate Control Business."

Although separating its two businesses has been an explicit possibility for some time, and this sale makes a lot of sense, the timing is noteworthy. LSB has been forced into making deals to stay afloat since the costs of its El Dorado expansion spun out of control in 2015.

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OCI’s Wever greenfield: capex up, lawsuit, and intense monitoring

There's plenty of new news about OCI's Iowa Fertilizer Company and its world-scale greenfield nitrogen plant at Wever, IA.

In the last two weeks, we've had earnings reports both from OCI and from the project's EPC contractor, Orascom, which is OCI's sister company. Plus, we had a response and countersuit in the ongoing lawsuit between Orascom and one of the project's subcontractors.

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Introducing TopChem, Investimus Foris subsidiary for Pollock

Investimus Foris has yet to make any announcements about its ammonia plant retrofit at Pollock, LA, but it has clearly made significant progress over the last few months.

The Lithuanian company established its US operating subsidiary, TopChem Pollock LLC, in October 2015. It assumed ownership of the plant site in December 2015, inheriting the unpaid environmental permitting fees of the previous owners. And it submitted its air permit application to LDEQ in March 2016.

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PotashCorp: downgraded, capex reduced, but new urea brownfield

In a move that might appear contrary to its "Disciplined Approach" of "Matching Supply to Demand," PotashCorp is quietly planning a potential new urea plant at Geismar.

More details of the brownfield project, which received its air permit in December 2015, are in my Research Note for Geismar, LA. The new urea plant is an addition to PotashCorp's existing plans for a major ammonia expansion.

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US Nitrogen lawsuit describes problems during construction

Austin Powder's new $225+ million ammonium nitrate plant was supposed to begin operations in March 2014. Now, more than two years late, the US Nitrogen plant at Greeneville, TN, is still in start-up mode.

Yes, there has been a lot of local opposition. Yes, permit revisions and all the appeals have slowed progress. But there were also technical, engineering causes for the ongoing delays.

US Nitrogen has just made some of these problems public.

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Agrium’s Kenai restart – at least three years away

Over the last few years, Agrium has said very little about the potential restart of its export oriented ammonia-urea plant in Kenai, AK, except that we shouldn't expect any "imminent" announcements.

However, this week's hearings on a tax incentive bill by the Alaska Senate Finance Committee are accompanied by a raft of new documents, showing the project is very much still on the table - it just needs gas (financial incentives would be nice, too).

[Update 03/18/2016: Alaska passed Agrium's tax incentive bill yesterday.]

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