All posts by traceybg@gmail.com

N.D. potash and salt deposits gain interest

News, Northern Plains, Potash

Interested parties are starting to stir over the vast potash and salts deposits located in about 11 square miles in the northwest corner of this state, according to the state geologist. Edward Murphy, who is also assistant director of the North Dakota Geological Survey, recently brought this to the attention of the local press, but at the time declined to disclose the company or companies involved in the discussions.

Last week, Murphy confirmed for Green Markets that one of the groups is Denver-based Dakota Salts LLC, which has its eye on solution-mining the salts and then using the emptied caverns for storing compressed air for generating electricity or carbon dioxide from coal-burning power plants or natural gas from the state’s oil fields.

Murphy declined to name the second group he has been in contact with, saying “I am not sure who ultimately is backing the people that I have been dealing with. I would not have access to that specific information until they submitted a permit application.”

A quick check, however, could find no major North American producer involved. The Mosaic Co. responded that market conditions are not conducive at this time for starting any greenfield or new projects. Spokeswoman Linda Thrasher said, “This is the first I’ve heard about North Dakota.”

Agrium spokesman Richard Downey said since his company “has access to its own high quality potash reserves that we are looking to develop in Saskatchewan and Manitoba, there’s no need to look elsewhere.”

Intrepid Potash in New Mexico didn’t respond to email inquiries, but that company is known to be involved in a major solution-mining proposal with the Bureau of Land Management in that state.

PotashCorp is on record as touting its own brownfield projects versus any new greenfield projects.

Many upstart companies, however, have searched the globe for potash in the past year; however, news from these has cooled somewhat after the coming of the global financial crisis. Whether they or anyone else has the financial wherewithal to start a new greenfield project in today’s climate is still to be seen.

Walter Doyle, the London-based chairman of Dakota Salts, said the rich salt and untapped potash deposits in the northwestern part of the state, along with huge wind farms planned in the area, made the project attractive. The newly-formed company intends to use idled drill rigs from the state’s oil patch to bore for salt and potash, he said.

Murphy previously has reported that potash deposits may be mined from North Dakota in beds of sylvite (potassium chloride) or sylvinite (mixtures of potassium chloride and sodium chloride). State estimates are that approximately 50 billion tons of potash occur in the Prairie Formation (Devonian) in North Dakota. These evaporites were deposited in a trough that extends from the Northwest Territories in Canada to northeastern Montana and northwestern North Dakota. Potash beds occupy an area of 11,000 square miles that extends from the Montana border to central Bottineau County, and from the Canadian border to central Dunn County. This salt interval reaches its maximum thickness of over 500 feet in Burke County, which is the location attracting Dakota Salts. The potash portion of the salt section has a gross thickness of 83 feet. Murphy explained the main reason that these potash deposits have not been utilized is because these same beds are found at much shallower depths, which enable the use of both conventional mining as well as solution mining in southern Saskatchewan.

Murphy says the advent of new technology should make it easier today to get to the North Dakota product.

Pryor gets permits; production planned for 3Q

News Briefs, Southern Plains

Oklahoma City-LSB Industries Inc. said Feb. 26 that its subsidiary, Pryor Chemical Co., has received required regulatory permits to operate the Pryor nitrogen facility in Pryor, Okla. “As previously reported, we have been considering activating a portion of our idle Pryor facility subject to securing a sales agreement with a strategic customer to purchase and distribute the majority of the UAN production and subject to receiving the necessary permits,” said LSB Chairman and CEO Jack Golsen. “Based on our discussions with several large strategic industry customers, we believe that in the near future we will be able to reach an agreement to sell or distribute the UAN production at the Pryor facility. Based on the current status of those discussions, coupled with the fact that we have now received the necessary permits, we are proceeding with the preparations to start the facility. Barring unforeseen delays and subject to securing a sales or distribution agreement as discussed above, we expect to start production at the Pryor facility during the third quarter of 2009. If the Pryor facility becomes operational, we plan to produce and sell approximately 325,000 st of urea ammonium nitrate (UAN) fertilizer and approximately 35,000 tons of anhydrous ammonia annually. The preliminary estimated total cost to activate the Pryor facility is approximately $15 to $20 million, with a portion of these costs to be expensed as incurred. We plan to fund this project from our available cash on hand and working capital. However, the actual timeframe to begin production, the related amount of production and sales, and the total cost to activate the facility could be significantly different from our current estimates.”

LOL earnings at near record in 2008; 4Q has loss

News Briefs, Northern Plains

Arden Hills, Minn.-Land O’Lakes Inc. reported near-record earnings for the year ending Dec. 31, 2008; however, the global economic climate pulled the company into the loss column for the fourth quarter. For the year, LOL had net earnings of $159.6 million on sales of $12.04 billion, versus 2007’s record earnings of $160.9 million and sales of $8.92 billion. LOL reported a fourth-quarter loss of $33 million on sales of $2.67 billion, versus the year-ago net earnings of $25.7 million and $2.59 billion, respectively. “Despite a soft fourth quarter, we delivered strong overall results in 2008, with record sales, net earnings nearly matching 2007’s record level, and our highest-ever cash returned to members,” said LOL President and CEO Chris Policinski. He said LOL is in a solid position moving into 2009. “There is no doubt that there are challenges ahead. No matter what business you are in, you can expect a bumpy ride in 2009. At Land O’Lakes, we’re confident we have the financial foundation, resources, strategies and people in place to weather the storm and continue to generate value for member-owners and customers.” LOL reported record cash returned to members of $98 million. LOL said agronomy sales, primarily crop protection products, were $2.3 billion in 2008. LOL said year-ago comparisons are not meaningful since it didn’t take on the crop protection business of Agriliance LLC until September 2007. Still, it said wholesale crop protection sales were up significantly from year-ago levels. LOL said agronomy reported $112.5 million in pretax earnings in 2008, up from the year-ago $16.4 million. Fourth-quarter agronomy sales were an off-season $212 million, with a pretax loss of $27.8 million and a year-ago loss of $1.6 million. LOL said 2008 agronomy demand was up due to strong early-year commodity markets, the ability to recognize and take advantage of unique, cost-effective herbicide sourcing opportunities, and the strength of the WinField Solutions marketing alignment with seed.

Yara restarts production in Le Havre

News Briefs

Oslo-Yara International ASA said Feb. 25 it has decided to restart production of ammonia and urea at its site in Le Havre, France, in mid-March. The Le Havre facility has an annual production capacity of 400,000 mt of ammonia and 350,000 mt of urea. Yara, which owns 100 percent of Le Havre ammonia production and 47.85 percent of urea production, said the decision to restart production reflects improved international urea prices and lower energy cost.

Rig spills AN in Las Vegas

Ammonium Nitrate, News Briefs, Southwest

Las Vegas-A tractor-trailer mounted with a blasting truck carrying 30,000 pounds of ammonium nitrate for a construction project overturned at an intersection at 5:44 a.m. Feb. 25, not far from the downtown area. According to city spokesman Jace Radke, the rig ended up spilling 5,000 pounds of the load, along with diesel from the truck. Radke told Green Markets the rig is usually not driven on streets and was on a detour for Interstate 15 northbound enroute to a blasting job in northeast Nevada. “The driver was making a turn, and because of the top heavy load the rig flipped on its side,” he explained. There were no injuries. He said the area is commercial and residential, and shop owners were advised to remain closed and occupants of an apartment building were notified to evacuate because of concerns about the diesel mixing with the spill while a fire department HazMat team secured the site and brought in a backhoe for cleanup. Firefighters remained on scene until the truck was up righted, and all the materials were cleaned from the street. There was no word about where or how the AN was disposed of. The tractor-trailer, operated by Sanders Construction of Henderson, was enroute to Glendale north of Las Vegas.

Corn acreage to stay at 86 M acres, says USDA

News Briefs, Northeast

Washington-U.S. corn acreage is expected to be 86 million acres this year, according to statistics released at the USDA Outlook Forum Feb. 26. This is a surprise to many analysts, who had expected corn acreage to be off due to the economic slowdown and a struggling ethanol industry. USDA is projecting a record soybean crop at 77 million acres. Wheat acreage is put at 58 million acres and cotton at 8.5 million, both down. A full discussion of these figures will be included in the Green Markets 2009 Agriculture and Fertilizer Outlook on March 4. See page 3 for more information.

Freeway crash spills liquid nitrogen

California, News Briefs, Nitrogen

Sacramento, Calif.-Highway patrol investigators aren’t putting any blame on the driver of a TruGreen Lawncare fertilizer truck for a Feb. 17 early-morning freeway crash that resulted in the spill of as much as 200 gallons of liquid nitrogen, requiring a large pumper truck to be brought in order to keep the liquid out of the drain system. Patrol spokesman Michael Bradley said a southbound vehicle started the chain reaction during a rainstorm by cutting off another car whose driver lost control, hit a sound wall, bounced back into traffic, and hit the TruGreen truck. The first car got away and was listed as “non-contact hit and run.” He said the truck driver was taken to the hospital for minor injuries and released. Bradley estimated that the fertilizer truck was carrying about 250 gallons of fertilizer and “more than less” was spilled, plus the contents of an undetermined number of granular fertilizer bags, which added to the mess. He said the southbound portion of the freeway was closed for three hours. TruGreen parent ServiceMaster of Memphis, Tenn., said TruGreen is working closely with authorities to establish more information about the accident and is continuing to monitor the situation.

Guilty plea on MagnaGro water violations

News Briefs, Southern Plains

Topeka, Kan.-The owner of MagnaGro International Inc., which produces plant stimulants in Lawrence, Kan., has pleaded guilty to unlawfully discharging fertilizer waste into the city sewer system and faces a maximum sentence of a year in federal prison and a fine up to $25,000 per day of violation along with his company, which faces a possible fine of $50,000 or more per day of violation, according to the U.S. attorney’s office here. Sentencing is set for June 1. Raymond Sawyer and the company were charged with criminal violations of the Federal Water Pollution Control Act, which also is known as the Clean Water Act. In their pleas, Sawyer and the company admitted discharging a large quantity of industrial waste from fertilizer production into the city of Lawrence’s sewer system, interfering with the operation of the sewer system. The Kansas Dept. of Health and Environment and the city of Lawrence ordered Sawyer to discharge no more material into the sewer system. In September 2007, EPA agents found Sawyer and MagnaGro discharging waste from the fertilizer operation into the city’s sewer system via a hose inserted into a toilet stool. For 10 years, investigators determined, Sawyer and the company had been discharging waste through the hose. The hose was used to pump material into the toilet from a waste pit surrounding a mixing vat. MagnaGro produces plant stimulants designed around root growth and plant metaphysical functions and blending soluble plant foods like MiracleGro to support the main product. Sawyer told Green Markets that he pleaded guilty to a misdemeanor for himself and a felony for his company “as the cheapest way out.” He said he doubted MagnaGro would be in business after March. His case has been dragging on for a year and a half, during which time, he said, the city shut off the water and dug up the sewer line. But he said that didn’t stop him. He hauled in thousands of gallons of water and hauled out the production wash to continue his plant operations.

Fertilizer surcharge stalled in Maryland

News Briefs, Northeast

Annapolis, Md.-The legislative outlook is in doubt for a $2 per ton surcharge on specialty fertilizer distributed in the state to be allocated to the Chesapeake and Atlantic Coastal Bays 2010 trust fund (GM Feb. 23, p. 12). If passed, the bill would make Maryland the third state to adopt measures to reduce the impact of fertilizers on water quality. But the bill, according to Bill Angstadt with the Delaware/Maryland Agribusiness Association, is stalled in committee, with no action in nearly a month. “There was a hearing on HB 136 on Feb. 4; and since then there has been no further action in committee. The chair has not asked for a third reading, which would mean a vote, and the Senate will not consider until it is passed in full House,” Angstadt reported. “Whether it has died in committee at this point is still up in the air. There have been no additional sponsors and the committee chair hasn’t joined as sponsor. That’s one good indication that it will fail this session, but you can never tell in politics.” Meanwhile, in Arkansas, a bill to double the state’s fertilizer tonnage fee to pay for soil tests and support the sampling and testing program is moving through the legislature without opposition, according to the state plant board. The bill, which raises the fee from $1.20 to $2.40, sailed through the Senate committee on agriculture, forestry and economic development, and on Feb. 23 passed the Senate 35 to 0. It was scheduled into the House agriculture committee before the end of the month. Under the higher rate, the University of Arkansas soil testing and research laboratory would get $1.78 per ton to help pay for soil tests, while 62 cents would go to the plant board to pay for sampling and testing. Since 1993 the number of soil samples processed each year has increased from about 55,000 to 115,000, causing the lab to run a deficit for the past three years.

Converted Organics reports progress, seeks cash

News Briefs, Northeast

Boston-Converted Organics Inc. said Feb. 24 that on Feb. 20 it completed an initial shipment of 22 tons of its all-natural, organic lawn and turf fertilizer to a major retail distribution chain for the Spring 2009 selling season. Converted Organics expected to ship a second 22-ton order to the same major retail distribution chain Feb. 25. It also announced that full-time, around-the-clock manufacturing operations commenced at the Converted Organics Woodbridge, New Jersey, facility Feb. 21. “Although Converted Organics expected to be fully operational in January, our production schedule was delayed. However, we are very pleased to have begun shipping our organic fertilizer to a major retail distribution chain for the upcoming growing season,” said Edward Gildea, company president. “The difficulties and challenges we encountered as we commenced our manufacturing system have been or are being addressed. To date in 2009, we have processed 1,131 tons of food waste at our Woodbridge facility and anticipate that figure to increase significantly in the near future as we operate on a 24-hour cycle.” The company said as a result of the delay in manufacturing, it is seeking additional cash resources. It has retained the services of Chardan Capital Markets LLC to pursue strategic offerings, including a potential financing or restructuring. Chardan is a full-service financial firm specializing in small and microcap companies in the international arena, encompassing both public and private sectors. Converted Organics has also been in the news lately as it owns a plant in Gonzales, Calif., which, under a former owner, allegedly spiked organic fertilizer with ammonium sulfate (GM Jan. 5, p. 10).