PolyNatura Corp. and Nitron Group LLC announced on Jan. 23 that they have entered a “take-or-pay” offtake agreement for the supply of multi-nutrient polyhalite products from PolyNatura’s greenfield mine in Lea County, New Mexico.
Under the agreement, which is subject to customary terms and conditions, Nitron reported that it will purchase 75 percent of PolyNatura’s production at its Ochoa Project in New Mexico, or 1.5 million st annually at peak production, over a five-year period commencing from first production.
“We are excited to partner with one of the most respected names in the global fertilizer industry,” said Graham Wheelock, managing director of PolyNatura. “Financial strength, geographic reach, and deep industry knowledge make Nitron the ideal partner to distribute our organic fertilizer globally, enabling farmers around the world to improve crop yields and quality.”
PolyNatura, an affiliate of the Cartesian Capital Group LLC, New York, is based in Hobbs, N.M. The company said its Ochoa Project in the Permian Basin in New Mexico has large, low-cost, proven reserves of polyhalite, and is the only naturally occurring scale deposit of polyhalite in the Americas. Cartesian acquired its ownership stake in the Ochoa Project in 2017 (GM Aug. 18, 2017) from IC Potash Corp., Toronto.
According to its website, PolyNatura’s initial plan was to mine and process polyhalite to produce potassium sulfate, but the company is now focused on the production of “direct application polyhalite.” The company’s timeline has initial production slated for 2021, with capacity ramping up to 2 million st/y by 2023. A feasibility study and detailed engineering plan were completed in 2017, with final design and preconstruction activities underway last year. The construction of the mine and process plant are planned for 2019-2020, with an anticipated development capital budget of $328 million.
PolyNatura said the mine has proven and probable reserves of 71 million st of 88 percent polyhalite grade, giving the mine a projected life span of 38 years.
Headquartered in Greenwich, Conn., Nitron is a global fertilizer trader and distributor. The company, which was founded in 1982, said it sold 7 million tons of fertilizer in 2018, and has clients in 65 countries and 100 employees worldwide. Its list of products includes a range of nitrogen and phosphate fertilizers, potash, and specialty fertilizers.
According to its website, Nitron’s core business is fertilizer trading, with its primary sales network in Latin America. In recent years, however, Nitron said it has expanded its sales network in Europe, Africa, and North America with products purchased from China, the Middle East, North Africa, European/Baltic nations, and North America.
“Our mission at Nitron is to provide high-quality products to meet the growing demands of our clients around the world,” said Nitron President Javier Urrutia. “This offtake agreement with PolyNatura will enable us to distribute an important organic fertilizer throughout the Americas and other key markets.”
Polyhalite mining for fertilizer use has been in the news in recent years, particularly given its promise as an organic fertilizer for the burgeoning cannabis industry. Sirius Minerals plc, a large developer based in Scarborough, England, has its own polyhalite project in North Yorkshire that is also targeting first production in 2021. Sirius plans an initial production capacity of 10 million mt/y by 2024, ramping up to 13 million mt/y by 2026 and 20 million mt/y in 2029 (GM Sept. 7, 2018). The company recently reported that it has aggregate peak contracted supply volumes for 8.2 million mt/y of its Poly4 product in place.
“Polyhalite is totally water soluble and contains potassium, magnesium, calcium, and sulfur, and so provides balanced crop nutrition,” said Raymond Hoyum, affiliate professor at Auburn University’s College of Agriculture. “As growers continue to strive for high yields and improved crop quality, polyhalite should be an essential part of their total fertility program.”