All posts by hlancey@bloomberg.net

APF Pauses New Louisiana Ammonium Sulfate Plant

Ammonium Sulfate, Featured, Sulfuric Acid, U.S.

American Plant Food Corp. has decided to pause its plans to build a new $228 million, 420,000 st/y ammonium sulfate plant at Cornerstone Chemical Co.’s Waggaman, La., complex (GM Oct. 27, p. 1), according to a report by nola.com, citing a statement by the company.

APF said the decision was based on “financial and economic considerations,” with Chief Operating Officer Jerry Bilicek quoted as saying that the company hopes conditions improve and it can restart the project in the future. The Dec. 5 notice came one day before local authorities in Jefferson Parish were to decide if APF would receive a major tax break for the project.

While the Louisiana Board of Commerce and Industry (LBCI) approved a first-year tax break of $3.66 million under the Industrial Tax Exemption Program (ITEP) for APF, local entities that will be impacted can vote on the measures, though ultimately they can be overruled by the LBCI and the governor. The matter was slated to go before the Jefferson Parish Council and Jefferson Parish School Board on Dec. 6.

APF was to source ammonia for the plant from CF Industries Holdings Inc.’s Waggaman ammonia plant (GM Dec. 1, p. 1), and sulfuric acid from Cornerstone.

While the LBCI unanimously approved APF’s request, there was opposition from environmentalists, along with some local residents who complained that the number of employees for the project had varied over time, falling from 100 at the time the project was announced down to 13 and then back up to 28, according to nola.com.

However, APF later explained the project would be built in phases and the company believed it would eventually move up to 100 employees.

Yara Invests $18 M in Brazil Specialty Fertilizer R&D; Green Ammonia Expected in 2024

Brazil, Featured, Green Ammonia, NPK

Yara International ASA will invest 90 million reais (~$18.2 million) in Brazil through 2025 for research and development of special fertilizers aimed at boosting regenerative agriculture practices, according to a Bloomberg report.

The company will hire about 50 people for the team that will be based at a research facility in Sumare, Sao Paulo state, Yara Brazil CEO Marcelo Altieri said at a Dec. 5 press conference. Yara invested 100 million reais (~$20 million) in 2018 in its first micronutrients plant in Sumare.

The company’s Industrial Complex at Rio Grande, in the south of Brazil, reached full capacity in 2023, with output at 1.1 million mt/y of NPK fertilizer after recent modernizing investments. Last year, the plant was working at half capacity.

In other news, Yara expects to start commercial scale production of green ammonia at its plant in Cubatao in second-quarter 2024, replacing 3% of its natural gas use with biomethane supplied by Brazilian bioenergy producer Raizen SA under a five-year contract. The biomethane is made from ethanol production waste.

The green ammonia startup in Brazil will be launched prior the product’s launch in Europe.

“There is no time to lose, and Yara is committed to reducing emissions all over the world, through multiple industrial methods. We plan to produce biomethane in Brazil, and in Norway we are currently constructing a green ammonia pilot plant,” a Yara spokesperson told Green Markets.

“Recently we signed a binding Carbon Capture Storage-agreement with Northern Lights (GM Nov. 24, p. 1) which will enable the world’s first cross-border transportation and permanent storage of approximately 800,000 mt/y of CO2 from our plant in Sluiskil,” he added.

Reward Minerals Inks Sale Agreement for Beyondie SOP Project

Australia, Featured, Potash, Sulfate of Potash

Junior Australian potash miner Reward Minerals Ltd. has entered into a binding share sale agreement with the receivers and managers of Kalium Lakes Ltd., which is under administration, to acquire the Beyondie Sulfate of Potash (SOP) project located approximately 160 kilometers southeast of Newman, Western Australia.

The acquisition is agreed upon a debt-free basis, free of encumbrances, for a total consideration of A$20 million (approximately $13.1 million at current exchange rates), Perth-based Reward Minerals said in a Dec. 5 ASX release. This amount includes a A$250,000 exclusivity payment previously made, upfront cash consideration of A$14.75 million, and deferred cash consideration of A$5 million due by June 30, 2025.

The agreement follows the company’s exclusivity deed with Kalium and the receivers, McGrathNicol, announced on Nov. 16 (GM Nov. 17, p. 1). Reward, which apparently had been weighing a potential purchase for some time, stepped in after another Western Australian SOP project developer, Agrimin Ltd., pulled out of a proposed deal for the Kalium assets in October (GM Oct. 6, p. 1).

A key condition for the completion of the binding share sale agreement is the approval of Deeds of Company Arrangement (DOCAs) for both Kalium Lakes Infrastructure Pty Ltd. (KLI) and Kalium Lakes Potash Pty Ltd (KLP), the entities directly associated with the Beyondie SOP project and whose 100% issued share capital is being acquired.

Reward’s next steps include creditor approval of each DOCA, shareholder approval in early January 2024, and a capital raising of A$22.785 million before costs.

“Assuming that the proposed deed of company arrangement with creditors and shareholders approval and capital raising are completed, the Reward team are keen to move quickly on evaluation of the plant and flowsheet modifications and costs for potentially re-commissioning the Beyondie SOP project,” said Reward Executive Director Michael Ruane.

He added that the evaluation will also cover the incorporation of the Reward Process into the existing project layout and also SOP recovery operations at other SOP resource sites. Upon completion, Reward plans to maintain the Beyondie SOP project on care and maintenance for 12 months to focus on the assessment.

Reward has two other potash projects in Western Australia, including its flagship Kumpupintil Lake Potash (formerly called Lake Disappointment Potash Project) east of Newman, and the Carnarvon Potash Project north of Carnarvon.

Australian Potash Goes into Voluntary Administration

Australia, Featured, Potash, Sulfate of Potash

Junior sulfate of potash (SOP) producer Australian Potash Ltd. (APC) has been placed into administration, making the company the third aspiring Australian SOP producer in just over two years to collapse amid growing negative investment sentiment in the developing Western Australia solar evaporation sector.

APC’s directors on Dec. 6 appointed voluntary administrators Hayden White and Daniel Woodhouse of FTI Consulting to the company, APC said in a Dec. 6 ASX release. APC’s subsidiary companies, which include the Laverton Training Centre corporate trustee, are not affected by this appointment and will continue to operate in their normal way, the company said.

“Following the continued and exhaustive engagement with shareholders and creditors over the past several weeks in an endeavor to maintain the company as a going concern, the directors are now of the view that a formal restructuring process should be allowed to take its course,” APC said.

The company announced in mid-June that it was putting its Lake Wells SOP project (LSOP), located some 500 kilometers northeast of Kalgoorlie in Western Australia, on ice “to preserve its inherent value” as APC weighed the next steps for the project (GM June 16, p. 29).

Then, in mid-August, it announced that it was surrendering LSOP’s mining leases after it had not been able to secure further funding after conducting “an exhaustive search” and providing several parties with access to due diligence material to enable them to invest in the development (GM Aug. 18, p. 1).

APC was targeting potential production of 150,000 mt/y of SOP at LSOP (GM May 25, 2021) and had binding offtake agreements for 100% of the project’s output with Germany’s Helm AG (GM Nov. 25, 2020), Australia’s Redox Pty Ltd. (GM March 20, 2020), Migao International (Singapore) Pte. Ltd. (GM April 17, 2020), and Mitsui & Co. (GM July 24, p. 28).

In this week’s ASX statement, APC said its directors are working with existing shareholders and third-party investors and intend to submit a recapitalization proposal to the administrators, which will seek to restructure the balance sheet, avoid liquidation, and allow all existing shareholders to participate in future capital raises.

APC said it is the view of its board that the company’s assets represent “an opportunity to create value for shareholders.” The company retains the database for the development of the Lake Wells SOP project, as well as its interest in the exploration license tenure it holds for Lake Wells, where it also has been pursuing a gold project.

APC said it believes the Lake Wells SOP project has considerable value for all stakeholders, and the company will be ready to deploy the project information and know-how should a new opportunity emerge for the project, said APC non-executive Chair Natalie Streltsova.

“Due to strong negativity in the market towards solar evaporation projects in Western Australia, we have turned our efforts to refocusing the company on our other existing project opportunities where we believe we have project targets that have the potential to create significant shareholder value,” she said.

In recent months, APC has been turning its focus to the upside of critical minerals, which include the Nexus REE and lithium projects in Western Australia, as well as the Lake Wells Gold project.

The other casualties in Western Australia’s nascent solar evaporation sector include Kalium Lakes Ltd., which collapsed into receivership in early August (GM Aug. 18, p. 1) after the aspiring SOP producer failed to find further financial support for its lower-than-expected development of the Beyondie SOP project.

Salt Lake Potash Ltd., another aspiring Australian SOP junior producer that had been jockeying for first producer position, went into administration in October 2021 (GM Oct. 22, 2021). Salt Lake had been targeting production of up to 245,000 mt/y of SOP at the Lake Way potash project in Western Australia

Salt Lake was subsequently sold to Prague-based Sev.en Global Investments in October last year (GM Oct. 14, 2020) after Sev.en reached a deal with Salt Lake’s receivers and senior creditors on the purchase of its subsidiaries.

BHP Group Ltd. – Management Brief

Management Briefs

BHP Group Ltd. has promoted Vandita Pant to CFO in a broad reshuffle of its executive team as it aims to boost copper output and enter the fertilizer sector. Pant, who joined BHP in 2016, takes up the post in March and will be replaced as Chief Commercial Officer by Rag Udd, who currently leads the business in the Americas.

Existing CFO David Lamont will continue at the company in an advisory capacity until 2025, while current Chief Technical Officer Laura Tyler will exit next year. In other changes, Johan van Jaarsveld will become Chief Technical Officer and Brandon Craig, who currently oversees BHP’s Australian iron ore mines, will replace Udd to lead assets in the Americas.

The appointments ensure the company has “the right mix of skills, experience, and perspectives to deliver BHP’s strategy and pursue our growth agenda,” CEO Mike Henry said Dec. 7 in a statement. “Our operating environment is increasingly complex, but also rich in opportunity.”

Though Henry, who became CEO in 2020, is seen as likely to remain in place for several more years, the executive changes will bolster the field of potential internal candidates to succeed him in the role, according to a Bloomberg report. Henry’s predecessor Andrew Mackenzie held the post for more than six years.

Under Henry, BHP has reshaped its portfolio by exiting oil and gas, selling coal assets, and completing the $6 billion takeover of OZ Minerals Ltd. to add more exposure to copper. Demand for the metal is forecast to surge as the world decarbonizes due to its use in power grids and electric vehicles. In October, BHP authorized a further $4.9 billion of investment in its massive Jansen potash project in Canada that will begin production of the crop nutrient from late 2026.

The BHP Board of Directors recently gave Henry its blessing to pursue a relationship with the CEO of a Canadian rail company that is building a railway to BHP’s Jansen potash mine, according to the Australian Financial Review, which reported that Henry is romantically involved with Canadian National (CN) Railway CEO Tracy Robinson.

BHP Chairman Ken MacKenzie told Australian Financial Review he was satisfied that measures were taken to avoid any conflicts of interest that could potentially arise as a result of the relationship, adding that appropriate conflict-of-interest controls were put in place.

According to Australian Financial Review, BHP appears to be leaving the door open to concluding potash haulage contracts with both CN and Canadian Pacific Railway in the future to maximize competition between the two railroads.

Nitricity – Management Brief

Management Briefs

Agtech startup Nitricity, San Francisco, reported that Jayesh Goyal has joined the company as Chief Commercial Officer, bringing over 25 years in commercial leadership roles within the energy and telecommunications industries. He has spent time at Enchanted Rock, Aggreko, Younicos, and AREVA.

Goyal holds an MBA from the University of Colorado at Boulder and a Computer Science degree from Birla Institute of Technology and Science.

Live Earth Products Inc. – Management Brief

Management Briefs, U.S.

Russell Taylor, Vice President of Live Earth Products Inc., a Utah-based, family-run business that mines and manufactures humic acid and fulvic acid-based products, received the 2023 Certified Crop Advisor (CCA) Conservationist of the Year Award on Dec. 5 in a ceremony in Washington, D.C.

The award recognizes a CCA who exhibits dedication to exceptional conservation delivery and customer service. Taylor has been a part of the CCA program for 10 years and has 24 years of crop advising experience. He also worked with the Association of American Plant Food Control Officials (AAPFCO) advocating for categories of products beyond basic chemical fertilizers, and has assisted USDA in drafting farm bill language related to specialty crop nutrients.

“Conservation is more than working in the field,” Taylor said “Conservation is also reshaping the rules that prevent farmers from accessing products and information that aid conservation. Getting CCAs and researchers’ expanded knowledge is essential to accomplish our goal of helping farmers.”

The CCA Conservationist of the Year award is administered by The American Society of Agronomy and supported by the USDA-Natural Resources Conservation Service (NRCS), Agricultural Retailers Association, American Society of Agronomy, CropLife America, Crop Science Society of America, National Association of Conservation Districts, National Association of State Departments of Agriculture, Soil Science Society of America, and The Fertilizer Institute.

IPL Confirms Plan for Waggaman Sale Proceeds

Ammonia, News Briefs, U.S.

Following the completion of the sale of its Waggaman, La, ammonia production complex to CF Industries Holdings Inc. on Dec. 1 (GM Dec. 1, p. 1), Incitec Pivot Ltd. (IPL) has confirmed its intention to return up to A$1 billion (approximately $657.4 million at current exchange rates) of the sale proceeds to shareholders (GM Nov. 17, p. 1).

CF purchased the 880,000 st/y Waggaman plant and related assets for $1.675 billion, subject to adjustments.

As previously announced, IPL intends to return the proceeds through a combination of a proposed on-market share buyback of up to A$500 million and a proposed distribution of up to A$500 that will be allocated between a pro-rata capital return and special unfranked dividend.

IPL said it will seek approval from shareholders at its upcoming annual general meeting on Dec. 20 for the company to buy back up to a maximum of 390 million shares (representing approximately 20% of its share capital) within a 12-month period, and for the company to undertake a pro-rata capital reduction.

Proposed Tax Credit Concerns Hydrogen Industry

Hydrogen, News Briefs, U.S.

A leaked draft of US Treasury Department guidance for claiming hydrogen production tax credits under President Joe Biden’s climate law is drawing warnings from advocates that the requirements may stifle the burgeoning industry before it takes shape, according to a Bloomberg report.

The drafted blueprint includes requirements sought by some environmentalists that would limit the $3-per-kilogram credit to hydrogen-production operations powered by wind, solar, or other clean-power projects built within the last three years, according to people familiar with the plan. Some of the details of the tax guidelines were reported earlier by Politico.

“If true, the Biden administration’s proposed strategy for implementing these provisions will fail to get this new industry off the ground,” Jason Grumet, CEO of the Washington-based American Clean Power Association, said in a Dec. 4 statement. “It is surprising and disappointing that the administration would propose such a rigid approach that is at odds with decades of learning about new technology deployment.”

The guidance in the Treasury Department draft also calls for hydrogen projects to be supplied with new, clean-power sources operating on the same grid on an annual basis through 2027, then on an hourly basis starting in 2028, the people said. The Treasury Department, which is expected to make its guidance public by year’s end, declined to comment.

The issue has sparked an intense lobbying battle and deliberations in the Biden Administration that have slowed the release of guidance, with White House Senior Clean Energy Adviser John Podesta helping referee debates between the Department of Energy and the Treasury Department.

With “up to $3 per kilogram for the cleanest of hydrogen, that is a big tax incentive – a big tax credit – and we’ve got to get that right,” Deputy Energy Secretary David Turk said in a US Chamber of Commerce event at the COP28 climate summit in Dubai.

The issue also has created rifts among hydrogen developers. Earlier this month Synergetic, a green hydrogen developer, resigned from the American Clean Power Association over its recommendations for the tax credits. Company CEO Mike Sloan said in an email that the trade group’s suggestions would “favor dirty hydrogen over clean hydrogen.”

Looser rules could actually encourage the purchase of low-tech electrolyzers from China, instead of more sophisticated equipment made in the US, said Paul Wilkins, a Vice President with Electric Hydrogen Co., a privately held maker of electrolyzers, which use electricity to split water into hydrogen and oxygen.

“If you go with dumb rules you are going to incentivize dumb production,” Wilkins said. “If what’s leaked is indeed accurate, then I think the administration hit the rational middle. Nobody was going to be completely happy.”

But environmentalists warn that unless there are strict rules requiring hydrogen to be produced with new clean power sources operating on the same grid and during the same time, it could drive further demand for fossil-fuel based electricity and unleash more greenhouse gas emissions.

“Without strong rules, hydrogen projects will increase emissions,” said Rachel Fakhry, a Policy Director at the Natural Resources Defense Council. “Getting them wrong means backsliding on our climate goals and paying for it.”

FuelPositive Reports FP300 Delivery Date

Canada, Green Ammonia, News Briefs

FuelPositive Corp., Waterloo, Ont., on Dec. 5 announced the official delivery date for its first FP300 on-farm, containerized, 100 mt/y green ammonia demonstration system. It expects it to be delivered to the Hiebert farm (GM Sept. 23, p. 28) in Manitoba on March 31, 2024.

The company said the FP300 is destined to become the world’s first farmer-owned green ammonia plant.

“We have entered the final stage of the pre-shipment preparation,” said Nelson Leite, COO and Board Member. “Our team have witnessed the system running at full rate and can’t wait to see it installed and producing green ammonia on farm. We are extremely proud of our incredible team efforts and accomplishments.”

FuelPositive said it recently signed a lease in Waterloo, Ont., for a 12,000 square foot manufacturing site to accommodate the production of the following 30 systems. The delivery of these systems is expected throughout 2024 and 2025.