CVR Energy Inc.’s nitrogen business reported a $9.7 million operating loss for the fourth quarter ending Dec. 31, 2010, compared to a year-ago operating income of $7 million. Fourth-quarter nitrogen sales were $39.4 million, versus the year-ago $39.3 million.
CVR said the income downturn reflected a major scheduled turnaround and an unplanned equipment outage at the UAN plant. Fourth-quarter UAN production dropped to 77,800 st versus the year-ago 176,600 st. Fourth-quarter UAN sales volumes were 73,800 st at an average price of $171/st, versus the year-ago 177,100 st ($132/st).
Fourth-quarter ammonia production was 37,700 st, down from the year-ago 39,300 st. Fourth-quarter sales volumes were 49,400 st ($491/st), versus the year-ago 34,400 st ($303/st).
Full-year nitrogen operating income was $20.4 million on sales of $180.5 million, down from the prior year’s $48.9 million on sales of $208.4 million.
Full-year UAN production was 578,300 st, down from 677,700 st. UAN sales volumes were 580,700 st ($179/st), versus the prior year’s 686,000 st ($198/st).
Full-year ammonia production was 155,600 st versus the prior year’s 156,600 st. Full-year sales volumes were 164,700 st ($361/st) versus the prior year’s 159,900 ($314/st).
CVR said on-stream factors associated with the nitrogen business were impacted by the downtime associated with a third-party air separation unit outage, the rupture of a high-pressure vessel, and a major scheduled turnaround in the fourth quarter. As a result, fourth-quarter gasification rates dropped to 68.8 percent from the year-ago 98.9 percent, ammonia synthesis loop rates to 67.3 percent from the year-ago 98.1 percent, and UAN to only 47.1 percent from the year-ago 96.7 percent.
Due to the downtime petroleum coke consumption was down, with those prices almost halved in the fourth quarter to $8/st from the year-ago $15/st. For the year, the average petcoke price was $17/st, down from the year-ago $27/st.
Company-wide, CVR saw reduced earnings for the fourth quarter and the year, though sales were up. Fourth-quarter net income dropped to $2.3 million ($.03 per diluted share) on sales of $1.15 billion from the year-ago $9.5 million ($.11 per share) on sales of $921.9 million. Full-year net income was $14.3 million ($.16 per share) on sales of $4.1 billion, down from the prior year’s $69.4 million ($.80 per share) and sales of $3.14 billion.