All posts by mickeybarb@charter.net

Transportation

U.S. Gulf:

Towing restrictions persisted at Port Allen Lock for the week as lock operators contended with guidewall damage sustained during a recent barge collision.

Until repairs at Port Allen are completed, vessels traveling westward are only permitted to lock unassisted while towing a maximum of one barge per turn. Tows with more than one barge are required to utilize an assist vessel. Eastbound tows were required to use assistance on lockages longer than 650 feet.

Dolphin repair work was reported halting Algiers Lock movements from 7:00 a.m. to 6:00 p.m. on Jan. 22. Towing restrictions will remain in force through Algiers until further notice, limiting unassisted tows measuring wider than 60 feet to 600-foot lengths. Unassisted tows below 60 feet wide are permitted to run lengths up to 700 feet, sources said, effectively capping lockages at four standard barges or two 30,000 mt tankers.

A collision prompted a navigation shutdown at the East Canal’s Rigolets Bridge, closing the structure for an estimated seven days. The repair operation had been expected to begin on Jan. 22, sources said, blocking access to the Pearl River.

Sources noted severe nightly fog delays beginning on Jan. 21, which slowed or stopped movements altogether for 8-12 hour stretches. Conditions were reportedly improving on Jan. 27.

Most Port Allen Lock delays were reported in a 5-15 hour range for the week, although sources noted intermittent delays stretching to as high as 39 hours. Industrial Lock waits were reported in a wide 7-25 hours, while Algiers Lock crossings peaked at 11 hours on Jan. 25-26. Tows passing Brazos Lock were delayed up to 28 hours during the week.

Mississippi River:

Sources reported a Jan. 24 shutdown at Mile 856-866 on the lower Mississippi River after a tow ran aground. The stuck barges were quickly lifted and freed, sources said, reopening the waterway roughly 24 hours later, on Jan. 25.

Revetment operations at Mile 208 concluded on Jan. 23, returning the area to normal navigation. The operation reportedly shifted to Mile 306, where southbound movements were projected to be blocked during daylight hours. Northbound travel requests were being considered on a tow-by-tow basis.

Rising water levels at the St. Louis river gauge were expected to ease a recent spate of low-water-related slowdowns between St. Louis and Cairo, Ill. The gauge was at 3.81 feet and rising on Jan. 27, and was expected to crest at 6.2 feet on Jan. 28 before dropping again.

The upper river’s Lock 27 auxiliary chamber was scheduled to return from planned repairs and maintenance on Jan. 30. The site’s main chamber will shut on Feb. 1-18 for maintenance, leading sources to predict delays.

Locks located on the upper Mississippi River are closed for the winter season. Spring reopening is tentatively set to begin on March 25 with Locks 13-19, followed by Lock 25 as early as March 31. Lock 27 delays were quoted up to 17.5 hours for the week.

Illinois River:

Thinning ice on the Illinois River prompted a lifting of requirements to utilize ice couplings. Falling temperatures later in the week were expected to necessitate a return to mandatory measures, sources said.

Planned demolition of the Utica Bridge, located at Mile 229.6, was rescheduled twice during the week, first to Jan. 29 from the previous Jan. 27 date, and then again to Feb. 11. Transit through the bridge is projected to be unavailable for at least 24 hours due to the event.

Raised wickets continued to be reported at Peoria Lock and LaGrange Lock, slowing movement through those sites. Delays were noted up to eight hours through Peoria Lock, while sources quoted LaGrange Lock waits at 7-15 hours on Jan. 25-26.

Ohio River:

The Emsworth Lock primary chamber was scheduled to return from repairs on Jan. 27, sources said. Vessels were noted passing through the auxiliary chamber while work was underway, effecting delays up to 22.5 hours for the week.

The Markland Lock secondary chamber is anticipated to remain shut through Oct. 29 due to structural damage to the miter gate. Transit remains available through the site’s primary chamber, with few delays expected.

The Corps will shut Meldahl Lock’s 1,200-foot main chamber on Feb. 1-11 for fill valve repair, leaving traffic to detour through the secondary chamber. The main chamber will shut again from April 12 to June 11 to repair miter gate machinery. Delays are expected while both projects are underway.

Smithland Lock’s two auxiliary chambers will undergo consecutive repair and maintenance shutdowns starting on Feb. 1. The chambers will close for 30 days in turn, concluding on approximately April 1. Lockages are anticipated to continue uninterrupted through the main chamber.

The New Cumberland Lock secondary chamber is scheduled to go offline from March 8 through June 10. Sources predicted navigation to remain available through the primary chamber while work is underway.

Greenup Lock will undergo a secondary chamber shutdown from March 11 through April 11, followed by a primary chamber closure from May 10 through June 11. During the main chamber shutdown, traffic will pass through the site’s 600-foot auxiliary chamber, triggering considerable delays.

The main chamber at Cannelton Lock will close to navigation from June 21 through Nov. 19, leading sources to warn of extended backups.

The Tennessee River’s Kentucky Lock saw delays up to 4-10 hours for the week, sources said. On the Monongahela River, Braddock Lock was reported returning to normal operation on Jan. 26. Sources previously described a series of intermittent eight-hour daytime shutdowns stretching back to Jan. 11.

Cheatham Lock, on the Cumberland River, will shut to navigation from April 12 through June 21, sources noted. The Corps will pepper a number of three-day openings throughout the shutdown to pass any waiting traffic, sources said.

Arkansas River:

Norrell Lock is scheduled to shut for repairs from 6:00 a.m. on Feb. 2 through 6:00 p.m. on Feb. 6. Movement is expected to be completely blocked while work is underway, effectively blocking tows from entering and exiting the Arkansas River.

Acron Boosts 2020 Fertilizer Output By 6 Percent

Acron Group, Moscow, said it increased its commercial fertilizer output by 6 percent last year, to 6.45 million mt, up from 6.09 million mt in 2019. The group’s overall commercial output, including industrial products, increased 7 percent to 7.98 million mt, versus 7.46 million mt in the previous year.

The group attributed the increase in its overall commercial output as mainly due to upgrades to the ammonia unit at its Dorogobuzh subsidiary in late 2019, which it said allowed increased output of all ammonia-based products at the Smolensk site.

Acron also highlighted its success in promoting its industrial-grade ammonium nitrate (AN) in international markets, with last year’s output of industrial-grade AN increasing 68 percent to 318,000 mt. Its AN output for the agricultural sector increased 25 percent last year, to 2.43 million mt.

The group remains on schedule to complete its Urea-6+ project at Veliky Novgorod in the second quarter of 2021 (GM Oct. 23, 2020). The completion of the upgrade will increase the unit’s production capacity by 520,000 mt/y, and will increase Acron Group’s annual urea production capability by over half a million mt to 1.9 million mt, making it the largest urea producer not only in Russia, but also in Europe.

Acron said it is targeting to produce 8.4 million mt of commercial products in 2021.

In a separate development, the group has signed a new collective three-year agreement for 2021-2023 with the Russian chemical industry’s primary trade union organization, Roskhimprofsoyuz, covering all of its employees. The collective agreement covers all aspects of social support for Acron’s employees, according to the trade union’s Chairperson Stanislav Melnikov.

Acron fertilizer production (‘000 mt)

Product 2020 2019 % change
Ammonia 2,729 2,583 +6
Nitrogen fertilizers 4,707 4,933 (5)
AN 2,430 1,951 +25
Urea 1,180 1,253 (6)
UAN 1,096 1,719 (37)
Complex fertilizers 2,372 2,026 +17
NPK 2,236 1,892 +18
Bulk blends 136 133 +2
Total commercial fertilizer output 6,448 6,087 +6

Acron selected industrial products output (‘000 mt)

Product 2020 2019 % change
Low density and technical grade AN 318 189 +68
Industrial urea 140 131 +6
Total commercial industrial products output 1,245 1,079 +15

PhosAgro, Acron See Domestic Market Sales Boost

Russia’s largest fertilizer distribution network, PhosAgro-Region, increased its total sales of fertilizers to the domestic market (including into storage facilities) by 12 percent to 3.54 million mt in 2020, up from in the prior year, PhosAgro reported this week.

Russian farmers increased their procurement by 8 percent, to 2.9 million mt. Sales of PhosAgro’s phosphate-based and complex fertilizers rose 7 percent to 2.36 million mt, while PhosAgro-Region’s sales of fertilizers manufactured by other producers last year reached 640,000 mt.

Acron Group similarly reported a sharp increase in its fertilizer shipments to the domestic market last year. It said it shipped 1.4 million mt, up 93 percent year-on-year.

Acron Group said its sales of ammonium nitrate to Russian growers more than doubled in 2020, while NPK supplies were up 70 percent Veliky Novgorod-based Acron saw its urea supplies up 36 percent and UAN supplies up 52 percent.

Growers in Russia’s central and southern federal districts remain the main consumers of the group’s products.

Agronova, Acron’s distribution network in the Russian market, was established in 2005.

Turkey’s Drillon Wins Moroccan K Exploration Contract

Turkish drilling company Drillon is reported to have won a MAD 8.4 million ($933,000) tender from Morocco’s national hydrocarbons and mines office to explore for potash in Boufakrane in the north of the country, according to an Africa Intelligence report.

The Ankara-based drilling firm was hired by the U.K. junior potash developer Emmerson plc to undertake an infill program at the U.K. company’s Khemisset potash project in northern Morocco. The infill program was completed in September 2019 (GM Sept. 6, 2019).

Central Petroleum-IPL Range Gas Project Contracts Drilling Rig

Incitec Pivot Ltd.’s (IPL) joint venture partner in the Range Gas Project in Queensland, Central Petroleum Ltd., has contracted with Alice Springs-based Silver City Drilling to drill three appraisal pilot wells at the project. Central said the first well is expected to spud – the early stages of drilling – in early April of this year.

The project, located in Queensland’s Surat Basin, was restarted in November last year after being halted in March due to the COVID-19 pandemic (GM Nov. 6, 2020). Gas from the project could potentially feed IPL’s Gibson Island nitrogen plant in Brisbane beyond 2022. Present estimates are that the project could produce around 45 Terajoules (TJ)/d of gas.

If successful, the pilot well program will be the catalyst for the Range jv to finalize a bankable full-field development plan in support of a final investment decision (FID), said CPL.

In parallel with the pilot activities, the jv is progressing key state and federal approvals in order to accelerate the planned FID and full field development.

Verdesian Reports Purchase Agreement

Specialty crop input producer Verdesian Life Sciences, Cary, N.C., said on Jan. 19 it has entered into a definitive stock purchase agreement with funds managed by AEA Investors LP, New York City. Verdesian’s management team, including President and CEO Kenny Avery, will continue to lead the company following the close of the transaction.

Terms were not announced. Private equity firm Paine Schwartz Partners, New York City, which formed Verdesian in 2012, was reported in negotiations to sell its stake in Verdesian this past November (GM Nov. 13, 2020). At the time, Verdesian was valued at over $500 million.

“AEA is the right partner to help us continue scaling Verdesian and doing what we do better than anyone else: offering Nutrient Use Efficiency technologies for growers all over the world,” said Avery. “With AEA, we are gaining a global partner who recognizes the potential of our products and will support our growth, both organically and through strategic investments, in North America and around the world.

“We are proud of what we have accomplished since our founding and have had a very successful partnership with Paine Schwartz,” he continued. “Looking ahead, we are excited to work with AEA as we continue to provide critical products to farmers that increase their productivity, profitability, and ability to do so sustainably.”

“We believe Verdesian’s leading product suite, R&D capabilities, entrepreneurial and customer-focused culture, and industry leading management team truly differentiate the Company from its peers and create a strong platform from which to grow and expand,” said Rahul Goyal, Partner, AEA.

“The company has considerable opportunities ahead as the need for greater productivity and more sustainable farming practices drives global demand for Verdesian’s Nutrient Use Efficiency solutions. We look forward to partnering with Kenny and the entire Verdesian team to help the company take the next steps in building on its portfolio of plant health and nutrition products, both organically and through strategic acquisitions around the world,” Goyal added.

“Our success with Verdesian, from creating the platform to building it into an important market-leader, is another validation of our thesis driven approach to investing in agribusiness,” said Kevin Schwartz, Paine Schwartz CEO. “We identified plant health and nutrition as important aspects of the agribusiness value chain and as areas that align closely with our sustainability strategy in the sector.

“We were able to help Verdesian capture opportunities through key strategic acquisitions and substantial investments across the platform. AEA Investors will be a great partner for the company, and we are confident that Verdesian will continue to thrive and create enormous benefits for farmers and the environment in the years ahead,” Schwartz said.

Paine Schwartz formed Verdesian to invest in plant health and nutrition. Within the fertilizer space, over the years it acquired Northwest Agricultural Products LLC (GM March 8, 2013); INTX Microbial LLC, Specialty Fertilizer Products LLC (GM July 7, 2014); Biagro Western Sales Inc. (GM Sept. 17, 2012); QC Corp. (GM Oct. 6, 2014); and U.K.-based Plant Syence Ltd.

The company has expanded geographically into new markets, including South America, and has over 240 employees.

Verdesian manufactures seed treatments, inoculants, and fertilizer enhancers with facilities in Pasco, Wash., Kentland, Ind., Cape Girardeau, Mo., and North Lima, Ohio. It said its portfolio includes more than 300 patent proprietary technologies developed in partnership with global research institutions and universities.

Founded in 1968, AEA manages funds that have over $15 billion of invested and committed capital, including the leveraged buyouts of middle market companies and small business companies and mezzanine and senior debt investments. AEA invests across three sectors: value-added industrials, consumer, and services.

In the meantime, a lawsuit alleging fraud against Paine Schwartz and Verdesian’s Board of Managers continues in a Delaware court, where two minority equity holders – David Bergevin and MKE Holdings Ltd. – allege that the defendants over-inflated the value of Verdesian acquisition SFP, Leawood, Kan. (GM July 7, 2014), in order to get them to help fund the deal (GM Feb. 7, 2020).

Trammo, Proton Cooperate on Green NH3

Trammo DMCC, Paris, a subsidiary of Trammo Inc., New York City, and Proton Ventures BV, Schiedam, the Netherlands, an engineering company specializing in ammonia technology, said on Jan. 18 they have signed a Memorandum of Understanding (MOU) for joint cooperation on green ammonia projects. Proton Ventures would construct green ammonia production units, storage facilities, and import and export terminals (NFuel Projects), and subsequently supply the green ammonia produced through wind and solar energy to Trammo.

Trammo, which has more than 55 years of ammonia marketing and logistics experience, would offtake and market the green ammonia and transport it to customers around the world using its fleet of specialized refrigerated vessels.

“We are pleased and proud to use Trammo’s long-standing transportation and distribution expertise to develop green ammonia projects,” said Christophe Savi, Head of Trammo’s Ammonia Division.

“Trammo strongly supports sustainable systems as well as environmentally friendly solutions, and intends to participate actively, together with its existing suppliers and other participants, in the industry’s green transition. We believe that this innovative partnership with Proton Ventures will create great synergies between our respective companies, allowing us collectively to service the global decarbonization process while adding new key logistics solutions for many of our partners in the marketplace,” Savi said.

“We are thrilled with this MOU with Trammo,” said Hans Vrijenhoef, CEO of Proton Ventures. “From a technical point of view, Proton Ventures will take the lead to organize, design, and execute NFuel Projects on behalf of our clients. We believe that the participation of Trammo as offtaker, with its extensive experience, reputation for reliability, and global marketing network, will ensure the required offtake agreements for the projects.”

In addition to its ammonia position, Trammo is active in sulfur, sulfuric acid, and petroleum coke. It is also a producer and marketer of nitric acid in the U.S.

Proton Ventures technologies and products include storage concepts for chemical and liquid energy carriers. It designs and builds pressurized ammonia storage facilities, small-scale ammonia production facilities “NFuel” units, and SCR processes.

Australia’s Leigh Creek Urea Project Awards ISG Contracts

Adelaide-based Leigh Creek Energy (LCK), which plans a 1 million mt/y urea facility in South Australia, north of Adelaide, has awarded two engineering, procurement, construction, and management (EPCM) contracts for the Stage 1 commercial development of the US$2.6 billion project.

The Leigh Creek Energy project (LCEP), which is located 550 kilometers north of Adelaide and overlays the Leigh Creek coalfield, aims to initially produce 1 million mt/y of urea, utilizing in-situ gasification (ISG) technologies.

LCK said on Jan. 18 the Upstream contract has gone to InGauge Energy Pty., Brisbane, which has been hired to manage drilling services for development of initial gasification wells to provide feedstock syngas for a 5 MW power plant. The Downstream contract has been awarded to Brisbane-based Prudentia Process Consulting Pty Ltd. to manage selection, engineering, construction, and commissioning of the 5 MW gas-fired power plant.

These two commercial stages of the project will be developed in parallel. LCK said it will separately contract for long lead items that will then be managed by respective EPCM contractors.

The positive project economics for the development of the urea production facility supported by syngas feedstock were confirmed in LCK’s recently-released pre-feasibility study (PFS), the company said.

“The PFS outlined an average nominal production cost of US$109/mt, which places the LCEP project in the lowest cost quartile of the global urea cost curve,” said LCK. “Pre-tax leveraged Net Present Value (NPV) is A$3.4 billion, with an internal Rate of Return (IRR) of 30 percent.”

LCK expects first urea production in late 2023.

“With the award of these contracts, LCK moves closer to becoming a significant supplier of domestically-produced urea providing additional security to a critical product to the Australian agricultural sector,” said LCK’s Managing Director Phil Staveley.

Two other major urea projects are under development in the country. Strike Energy Ltd., also headquartered in a suburb of  Adelaide at Thebarton, earlier this month announced the launch of Project Haber, an ammonia and 1.4 million mt/y urea complex for Western Australia’s Narngulu Industrial Estate. The site lies adjacent to Geraldton Port (GM Jan. 15, p. 1).

Like the LCK project, Strike Energy said its Haber Project will be primarily focused on meeting the needs of Australian farmers, with surplus product to be made available to international markets.

Perth-based Perdaman Industries’ (Chemicals and Fertilisers) is also working to establish a 2.14 million mt/y urea project near Karratha on Western Australia’s Burrup Peninsula. A long-time-in-development project, Perdaman only signed an engineering, supply of equipment and materials, construction, pre-commissioning, and commissioning contract for the execution of the urea plant in December (GM Dec. 31, 2020). This followed the inking of a 20-year natural gas supply agreement with Woodside Energy for the project in November 2018 (GM Nov. 21, 2018),

This week also saw news of the announcement of the signings of memorandum of understandings – albeit non-binding – for a giant fertilizer complex in Western Australia’s  sparsely populated northern region, which would include ammonia and urea production, by a little known Australian consortium. The consortium is reported to have the in principle backing of a large Dubai water and energy company, ARJ Holding Group (see separate news story).

Major Fertilizer Complex Proposed for Australia’s Northern Kimberly Region

Plans for a major Australian fertilizer project seemingly took a step forward this week with the inking of three memorandums of understanding connected with the development. A little known Australian consortium that is reported to have the in-principle backing of a large Dubai water and energy company, ARJ Holding Group, is proposing a A$4.1 billion project that would frack gas in Western Australia’s Canning Basin 150 kilometers southeast of Broome, according to a report by Australia’s Financial Review.

The project’s developer, Derby Fertilisers and Petrochemical Complex (DFPC), on Jan. 20 announced non-binding memorandums of understanding with Danish catalysis company Haldor Topsøe for the design, and with little known Australian firm Theia Energy for the gas supply, according to the report. DFPC is also reported to have signed a memorandum with China’s Shanghai Electric for the construction of a 100 MW solar farm.

According to its website, DFPC is proposing to develop ammonia, urea, methanol, and complex fertilizer plants and a power station near Derby, in the Kimberley region of Western Australia’s sparsely populated northern region. Proposed production capacities include 3,500 mt/d of ammonia, 5,000 mt/d of methanol, and 4,000 mt/d of urea under phase 1 plans. A second phase utilizing domestic supplies of phosphate rock is proposed for a plant with capacity to produce 350,000 mt/y of complex fertilizers and 375,000 mt/y of MAP/DAP.

The ambitious proposal would be dependent on a gas supplier that has not yet established certified reserves for the project, and which would have to overcome multiple environmental, heritage, and planning approvals to drill wells and process and pipe the gas over about 450,000 hectares of the Canning Basin, according to the report.

Theia Energy has a prospective resource of 3-5 billion barrels of oil equivalent in the 450,000 hectares covered by its exploration license, but the report, citing Theia’s COO Jop van Hattum, said the energy company would not be able to estimate certified reserves until the project received a final investment decision, due in about two years.

Belaruskali Seeks Cooperation with Yara, Ready to Re-Hire Dismissed Workers

Belarus-state-owned potash producer Belaruskali said it wants to continue its partnership with Norwegian group Yara International ASA and has confirmed it is ready to take back employees fired over their participation in political protests and strikes following the disputed presidential election on Aug. 9.

“Following a regular dialogue with Yara International, Belaruskali declares its readiness to cooperate on a long-term basis with Yara in the field of industrial safety, and is ready to accept Yara specialists on the ground to monitor production processes,” the Belarus producer said in a Jan. 20 statement on its website.

“We will continue cooperating with Yara to ensure the health, safety, and well-being of Belaruskali employees,” the company said.

“Belaruskali management has made the decision to remove disciplinary sanctions against employees who went on strike or who were involved in protests of the enterprise, and reinstate allowances and bonuses for workers who had been subject to disciplinary penalties. Previously dismissed employees can be re-employed by Belarusakali if they submit appropriate applications,” the potash producer said.

Belaruskali in November was reported to have dismissed 49 strikers, and had warned other employees that they would also face dismissal if they disregarded their work duties and participated in strikes (GM Nov. 27, 2020).

On Jan. 19, the Belarusian Supreme Court rejected an appeal by the potash producer’s strike committee against a ruling by the Minsk regional court in September that found the strike, started on Aug. 17,  was illegal (GM  Sept. 18, 2020).

Yara International ASA President and CEO Svein Tore Holsether in December said the continued suppression of human and workers’ rights in Belarus, as described in the recent report by the OSCE Rapporteur, was “unacceptable,” and that the current situation was “not tenable” for Yara (GM  Dec. 11, 2020). He also cited recent safety incidents at Belaruskali sites as “alarming.” Holsether, who visited Belaruskali in September to make his position clear, did not say whether Yara would sever business ties with the potash producer.

The Norwegian group in a statement on its website on Jan. 21 reiterated that “it has a strong commitment” to the universal human rights agenda, including the right to strike, and backs the UN High Commissioner for Human Rights in her “condemnation of human rights abuses in Belarus.”

As a long-term partner to one of Belarus’s biggest companies, Yara reminded that it has over the past months sought positive change through a close and regular dialogue with the management of BPC and Belaruskali, including physical visits to Belarus in September and December to make clear the importance Yara attaches to the ethical conduct of its business partners.

Yara said it continues to engage with a number of stakeholders inside and outside Belarus, including the leader of the Belarusian democratic opposition, Sviatlana Tsikhanovskaya, to evaluate how it can have the most positive impact.

Tikhanovskaya earlier this month had called on Yara to suspend its supply contracts with Belaruskali, and to support the potash workers on strike (GM Jan. 15, p. 37).

In its statement this week, Yara said its main concern remains the health, safety, and well-being of Belaruskali workers.

“Following a series of meetings between Yara and its Belarusian business partners over the past months, Belaruskali has announced steps to improve the situation for and relations with its workforce, including reintroducing allowance and bonus schemes for workers who had previously been subject to disciplinary penalties, and offering to re-employ terminated workers. The company also declared its readiness to cooperate with Yara on industrial health & safety improvements,” said Yara.

While the Norwegian group sees these steps as “positive,” it said it will continue to monitor the situation closely and expects Belaruskali to further improve the situation for its workforce, respect workers’ rights, enhance occupational health and safety, and refrain from repression of employees.

Belarus pro-democracy and a pro-human rights news site Charter 97 said on Jan. 21 Belaruskali management’s response was because they were “frightened about the termination of contracts with Yara.”