Intrepid Potash Inc. said Jan. 21 that in December 2009 it experienced a substantial production disruption at its Carlsbad East surface facility. It said sub-freezing temperatures in the region, which were substantially below historical averages during the month of December, together with record snowfall, led to a series of events at the Carlsbad East surface facility. These included interruption of the fresh water supply and disruption of electrical power provided to the facility, events which substantially impaired the surface processing of potash. As a result, Intrepid estimates that potash production at the Carlsbad East surface facility was limited to approximately 2,000 tons of saleable product in the month of December, a nearly 90 percent decrease from historical average monthly potash production at this facility. Intrepid expects that normal potash production levels at the Carlsbad East surface facility will resume in late January 2010.
Intrepid estimates that Trio?äó production during the month of December was largely consistent with average monthly production rates for 2009. Because it uses a different process to refine ore, Intrepid’s Carlsbad West surface facility was not significantly affected by the severe weather conditions. Also, underground mining operations were not significantly affected.
As a result of these unexpected production disruptions at the Carlsbad East surface facility, on an unaudited-basis, Intrepid anticipates that it will record abnormal production expense in the fourth quarter of 2009 of approximately $9-$10 million, or approximately $0.07-$0.08 per diluted share for the quarter. This estimated amount is approximately $3-$4 million more than was incurred in the third quarter of 2009.
On an unaudited basis, during the fourth quarter of 2009, Intrepid estimates that it produced between 120,000-130,000 st of potash and sold between 145,000-155,000 st of potash. Intrepid estimates that the average net realized sales price for potash during the quarter was approximately $400-$420 st. Intrepid estimates that it produced approximately 40,000-50,000 st of Trio?äó and sold approximately 20,000- 30,000 st of TrioTM. Intrepid estimates that the average net realized sales price for TrioTM during the quarter was approximately $180-$200 per ton. Intrepid expects to release its audited fourth quarter 2009 and fiscal year end 2009 financial results before market opening on Monday, March 1, 2010.