I’m calling it quits for Magnida.

The proposed greenfield plant at American Falls, ID, has been in various forms of development since 2005 – it began as a “clean coal” power plant, and had been reimagined as a fertilizer plant by 2013.

Things looked great to start with. Half a billion dollars of equity was in place, thanks to the project sponsor, Egypt Kuwait Holding Company. The project was led by private equity managers with significant infrastructure experience. The air permit was approved in April 2014. The bank debt was in place as well.

But things began to sour.

ConAgra appealed the air permit in May 2014, which created a 6-month delay at the worst time. Construction costs had spiraled to $3 billion and, even though management retooled plans and brought costs back down to $2.5 billion, the sponsor got cold feet and withdrew its support in November 2014.

Despite making continued progress through 2015 – the EPC contract was awarded to KBR in July 2015 – a new sponsor couldn’t be found.

And then the bottom fell out of the nitrogen market.

In September 2016, as I wrote, it seemed like a liquidation sale when Magnida began selling its water rights back to the county. The county’s decision to issue a $8 million bond to pay for these water rights was put to a ballot vote, which passed in November 2016.

But the nail in the project’s coffin, for me, is the fact that Magnida allowed its air permit to expire in October 2016 – the permit was conditional on construction beginning by then, but those terms could easily have been extended. Had Magnida intended to keep trying, it would simply have filed for an extension of this permit. However, it didn’t.

Now that the air permit has expired, Magnida would need to go through the entire application process from the beginning, which could take upwards of a year.

Without that permit in hand, I’m assigning Magnida to the project development dustbin.

You can find more details in my Research Note for American Falls, ID. The site has been a proposed greenfield for the last 12 years – and here’s wishing better luck to the next project to take it on.