LSB Industries Inc., Oklahoma City, said May 8 that one of its chemical business subsidiaries, Pryor Chemical Co., entered into a UAN purchase and sale agreement with Koch Nitrogen Co., LLC. Koch will purchase substantially all of the UAN production at the Pryor Chemical facility located at Pryor, Okla. The agreement has a five-year term with termination options by both parties beginning after August, 2010.
“We have been working toward obtaining an agreement with a third party to purchase a large portion of the UAN production at the Pryor facility,” said Jack Golsen, LSB chairman and CEO. “With this agreement, we look forward to starting the Pryor, Okla., facility in the third quarter of this year, having obtained all necessary permits, ordered needed production equipment and filled key posts at the plant. We expect to initially produce and sell approximately 325,000 tons annually of UAN, 35,000 tons annually of anhydrous ammonia, and other products.
“We have had a long and productive relationship with Koch Nitrogen Co., and expect that this agreement will be mutually rewarding for both our companies as we each grow our nitrogen-based fertilizer businesses,” he continued.
“This agreement with Pryor Chemical allows us to enhance our existing distribution capabilities in the Midwest,” said Steve Packebush, Koch Fertilizer LLC president. “This agreement combines the capabilities of our two companies to help us serve our customers better and add value in the region.”
Koch Nitrogen is an affiliate of Koch Fertilizer, an indirect, wholly-owned subsidiary of Koch Industries, Inc.