Agrifos Holdings Inc. said today that while it has sold its production assets in Pasadena, Texas, to Rentech Nitrogen Partners LP (GM Nov. 5, p. 1), it will retain full ownership of 350 acres of land adjacent to the plant site sold to Rentech and the site will be used to build a world‐scale nitrogen fertilizer plant with deep‐water access.

Agrifos has formed a new, wholly-owned subsidiary, Pasadena Nitrogen LLC. which will be the vehicle for developing, constructing and operating the production facility.
“We believe that our Pasadena site will be very suitable for development of a new nitrogen fertilizer plant, combining Houston’s well developed gas supply infrastructure and supplies, efficient logistics to agricultural markets in the US and internationally, and a site in the heart of America’s chemical industry,” Farouk Chaouni, Agrifos chairman.

Agrifos said it has already completed a basic feasibility study for the project and plans to initiate permitting activities in the near future. Agrifos noted that it is currently the sole owner of Pasadena Nitrogen, which was not part of the Nov. 1, 2012 transaction with Rentech. Agrifos intends to partner with a major international participant in the fertilizer sector in developing Pasadena Nitrogen.

Agrifos is also a shareholder in JDC Phosphates of Fort Meade, Fla., through its affiliate Vulcan Phosphates, as well as Agrifos West Africa, based in Dakar, Senegal. Macquarie Capital Inc. was Agrifos’ exclusive financial advisor in the sale of Agrifos LLC to Rentech. Seward & Kissel LLP served as lead transaction counsel to Agrifos.

CF Industries Holdings Inc. reported record earnings, earnings per share and EBITDA for the third quarter ending Sept. 30, 2012. Net earnings attributable to shareholders were up 22 percent to $403.3 million ($6.35 per diluted share) on sales of $1.36 billion, compared to the year-ago $330.9 million ($4.73 per share) on sales of $1.4 billion. EBITDA was $729.1 million, up from the year-ago $640.8 million.

CF said markets were characterized by good demand in North America during the quarter, as purchasing activity for summer fill programs was brisk and fertilizer dealers and distributors sought to replenish inventories in anticipation of a high level of fall field work to support large expected crop plantings in 2013. However, CF said activity was less than expected during the quarter in international markets, particularly Central and South America.

Total sales volumes were off 2 percent to 3.5 million st in the quarter largely due to lower urea sales compared to the prior year period. Overall, higher prices helped offset lower volumes in the nitrogen segment. Lower phosphate prices resulted from lower global demand relative to the year-ago period, while phosphate volume increases resulted from strong North American demand.

Nine month net earnings were $1.38 billion ($21.19 per share) on sales of $4.62 billion, up from the year-ago $1.1 billion ($15.41 per share) on sales of $4.38 billion. EBITDA was $2.48 billion, up from the year-ago $2.11 billion.

Ohio-based Nachurs Alpine Solutions has announced plans to renovate a 174,500-square-foot manufacturing facility in Louisiana’s Iberville Parish to produce the company’s liquid fertilizer products and distribute them to agricultural customers in the South and globally.

Nachurs recently purchased a 69-acre parcel of the Ciba-Geigy Corp. site in St. Gabriel, La., and will invest $13.9 million to renovate existing structures at the location. Louisiana Economic Development (LED) estimates the project will create 16 new direct jobs with an average salary of more than $45,700 plus benefits, as well as an additional 44 indirect jobs.

Construction will begin before the end of the year and will be completed by mid-2014, with Nachurs beginning to hire employees during the construction phase. Nachurs is headquartered in Marion, Ohio, and plans to use the St. Gabriel facility to supply customers in Louisiana and the South, as well as export markets.

“Our reasons for locating to the Louisiana site are to better serve and expand our fertilizer and industrial businesses in the South and to have good port access for importing and exporting," said Jeff Barnes, chief financial officer for Nachurs Alpine Solutions. “The Ciba-Geigy site will allow us to undertake new manufacturing processes, and Iberville Parish provides us with a strong workforce.”

Nachurs manufactures and sells liquid fertilizer for a wide variety of agricultural applications, including precision-placed, seed-safe, starter fertilizers for corn, soybean, and wheat. The company also develops liquid fertilizer for canola, alfalfa, potatoes, sugar beets, lentils, and various other fruit and vegetable crops. Nachurs has five other manufacturing facilities in the U.S. and Canada, along with 30 product depots for customer convenience.

“Nachurs Alpine Solutions is a prime example of companies selecting Louisiana as the next great state for business investment,” said Louisiana Gov. Bobby Jindal, who joined Nachurs officials in making the announcement. “Nachurs joins a long list of chemical manufacturers investing in Louisiana because of our world-class energy infrastructure, strong business climate and incomparable workforce. This project also represents the redevelopment of a former industrial site and exemplifies how we continue to make use of our existing assets to attract new career opportunities for Louisiana families."

Ciba-Geigy developed the St. Gabriel location in 1970 as an herbicide production facility, and much of the original site has been retained through mergers involving Syngenta Crop Production Inc. The Iberville Chamber of Commerce, LED, and the Baton Rouge Area Chamber (BRAC) worked with Nachurs to secure additional acreage and identify the site as a prime location on the Mississippi River for the company’s sixth manufacturing facility.

Nachurs is expected to utilize incentives from Louisiana’s Quality Jobs and Industrial Tax Exemption programs to finance the facility’s construction.

CF Industries Holdings Inc. has detailed $3.8 billion in plans to expand its North American nitrogen capacity. It will construct new ammonia and urea/UAN production units at its complex in Donaldsonville, La., and new ammonia and urea units at its complex in Port Neal, Iowa. CFs’ board of directors has authorized expenditure of $3.8 billion for the projects and the company has retained engineering and procurement services from ThyssenKrupp Uhde through their affiliate Uhde Corp. of America. In combination, these projects will be able to produce annually 2.1 million st of gross ammonia and upgraded products ranging from 2.0 to 2.6 million st of granular urea and up to 1.8 million st of UAN solutions, depending on product mix.

For more details, see the Green Markets Web Edition November 2.

The Army Corps of Engineers Louisville district has under consideration an application from Agrium Advanced Technologies to operate a fertilizer coating facility and barge terminal on 104 acres along the Ohio River near Brandenburg, Ky. There was no immediate confirmation from Agrium but a top official with Meade County told Green Markets that the process has been moving along for the past 10 months and “I would say we’re about 90 percent over the initial hurdles.”

Gerry Lynn, Meade County judge executive, said Agrium has not as yet accepted a tax incentive package offered by the state but company officials have met several times with the state economical development cabinet.

Public comment is being accepted by the Corps of Engineers through November 26.

Rentech Inc. today announced that its majority-owned subsidiary, Rentech Nitrogen Partners LP, has entered into a definitive agreement with Agrifos Holdings Inc. to purchase all of the membership interests of Agrifos LLC, for an initial purchase price of $158 million. Agrifos owns and operates a plant in Pasadena, Texas, that produces primarily ammonium sulfate fertilizer. The acquisition is expected to be accretive to cash distributions per unit paid by Rentech Nitrogen to its unitholders beginning in 2013.

Rentech currently owns 23.25 million units of Rentech Nitrogen, a publicly-traded partnership that owns a nitrogen fertilizer manufacturing plant located in East Dubuque, IL.
In conjunction with the closing of this transaction, Rentech Nitrogen has secured commitments from its existing and new lenders to amend its existing debt facility, and expand its borrowing base from $135 million to $300 million. The debt facility will continue to be guaranteed by Rentech Nitrogen. The transaction, which is subject to customary closing conditions, is anticipated to close within one week of the date of this announcement.

Commenting on the transaction, D. Hunt Ramsbottom, CEO of Rentech and Rentech Nitrogen GP LLC, stated, “We’re very pleased to have executed on this transaction. Growing Rentech Nitrogen is one of the pillars of our strategy to enhance returns for Rentech shareholders.” Mr. Ramsbottom continued, “Agrifos’ business is expected to provide incremental cash flow and diversifies the products, markets, location, and raw materials of our existing natural gas-based nitrogen fertilizer plant in East Dubuque, Illinois. Not only do we expect this business to be accretive to cash available for distribution beginning in 2013, but the facility comes with several growth opportunities, the first of which we have included in our financing package for this transaction. This growth at the Pasadena plant would add to the growth in cash flow that we expect from the expansion projects currently underway at Rentech Nitrogen’s existing fertilizer plant.”

LSB Industries Inc. has announced that as a part of the Chemical business hedging strategy to protect against rising natural gas prices, a subsidiary within LSB’s Chemical business closed an acquisition of a working interest in certain natural gas properties at a cost of $49 million. The acquisition included an approximate 7.7 percent average working interest within the Marcellus Shale, located in Wyoming County, Pennsylvania. The purchase includes interests in 14 proved producing natural gas wells, 7 proved non-producing natural gas wells, and 36 proved undeveloped future drilling locations identified on the leasehold. LSB expects to spend $38 to $40 million from the expected cash flows from the producing wells for additional capital expenditures to fully develop its share of these leaseholds through 2015.

LSB’s Chemical business considers this acquisition as a hedge against potential natural gas price increases in the future for a portion of its chemical plants’ future natural gas feedstock requirements. The purchase price was funded by utilizing cash on hand. LSB is considering financing a portion of the acquisition price from a third party in the near term.

In commenting on the acquisition, Jack E. Golsen, Board Chairman and CEO stated that “Our Chemical business has the capacity at their Alabama and Oklahoma facilities to consume over 12 million mcf of gas annually in the production of nitrogen products, including anhydrous ammonia and urea ammonium nitrate. This acquisition includes potential gas reserves equal to approximately 20 percent of our current annual natural gas requirements over the next 8 years at an estimated present value cost of approximately $2.30 per mcf, including development and operating costs.”

Potash Corp. of Saskatchewan Inc. today acknowledged the statement made to the Tel Aviv Stock Exchange by Israel Corp., particulars of which include: discussions have occurred with the Israeli government officials around potential options to increase PotashCorp’s ownership stake in Israel Chemical Ltd. (Israel Chemicals); and no deal has been formulated, there is no assurance that a deal will be reached, or that parties will sign an agreement.

PotashCorp said it does not intend to comment further on this matter at this time.

The Israeli economic newspaper, the Calcalist, reported earlier today, that PotashCorp CEO Bill Doyle met recently with Israeli Prime Minister Benjamin Netanyahu in an attempt to lobby for the deal. A merger of the two would form the largest fertilizer company in the world.

PotashCorp already owns 13.9 percent of ICL and last December requested permission to increase its stake to 25 percent. Israel’s Finance Ministry approved the deal but the country’s Anti-Trust Commission expressed several reservations. Recently, analysts and a PotashCorp official had indicated the company might shed its minority stake since it has been unable to gain majority status.

The report said that formal negotiations between PotashCorp and Israel Corp., which owns the majority stake in ICL, would only get underway once the Israeli government gives its approval to such a deal. Such a deal would be considered highly controversial as it would give a foreign company control over local natural resources from the Dead Sea. ICL was privatized in the mid-90s. However, the Israeli government retained a golden share at the time which enables it to protect state interests.

ICL trades on the Tel Aviv Stock Exchange and has a market valuation of $15 billion. In today’s trading the ICL share price on the Tel Aviv Stock Exchange is up by 4.65 percent and Israel Corp. is up by 5.32 percent in very heavy trading.