With prospects for a CF Industries Holdings Inc. and Terra Industries Inc. joint venture plant in Trinidad waning, the two partners appear to be going their separate ways and assessing projects on their own. CF recently noted that the natural gas term sheet on the Trinidad project expired in December, and it has been frustrated by an inability to find an appropriate site in the country for a new plant.
CF Chairman and CEO Steve Wilson told analysts that CF is now focusing on Peru, where it won a gas supply contract late last year. Wilson said CF would like to see the Trinidad term sheet renewed, but that as far as his management group is concerned, it has turned its sights on the southwest and is aggressively working on the Peru project.
In the meantime, Terra, which was also to be in the Trinidad jv, lost out on its own bid to get a gas contract in Peru. Terra is now eyeing a number of $100-$150 million upgrade projects at existing facilities in the U.S. heartland. “We have identified several promising investment opportunities to upgrade more of our ammonia production into higher valued products, mainly UAN and liquid urea,” said Terra President and CEO Mike Bennett. He said Terra is in advanced stages of valuating one of these opportunities and expects to reach a decision soon. He said the first one could be completed in 2010.
Terra said it expects to invest some $10 million this year in the restart of the Donaldsonville, La., ammonia plant (GM Feb. 11, p. 1), with about half of that cost being for new catalysts. Once the restart begins, the company expects to be at full rates within a few weeks.
Terra also expects to squeeze more production out of its existing plants in 2008 as only one turnaround is expected, and that is for the Port Neal, Iowa, plant.
In related news, Bennett said the company ended 2007 with some $300 million in customer prepayments, which is the highest level it has ever experienced in its nitrogen business.