Yara completes 50 percent JV with NOC/LIA of Libya

Oslo-Yara International ASA, National Oil Corp. of Libya (NOC), and Libyan Investment Authority (LIA) have signed the final agreements to create the fertilizer joint venture Libyan Norwegian Fertilizer Co. (Lifeco). Yara, NOC, and LIA will have ownership shares in the new company of 50 percent, 25 percent, and 25 percent, respectively. The closing of the deal follows approval of the required licenses under the Libyan Investment Law. NOC transfers to Lifeco the existing Marsa El Brega fertilizer assets, valued at US$225 million, while Yara contributes to Lifeco the corresponding value in cash. NOC will supply natural gas to Lifeco under a long-term agreement with a gas price linked to fertilizer product prices. Yara will handle all urea and ammonia exports from Lifeco. The existing operations produce approximately 900,000 mt of urea and 150,000 mt of merchant ammonia per year. Lifeco is jointly set up by NOC, LIA, and Yara to own and operate the fertilizer facilities located at Marsa El Brega at the Mediterranean coast, some 700 km east of the Libyan capital Tripoli, with approximately 1,200 employees. Key utilities and services will be supplied by Sirte Oil Co., a NOC subsidiary and the owner and operator of the rest of the chemical complex at Marsa El Brega. Lifeco will embark on a program to optimize and upgrade its operations. A second phase will aim to invest in new world-scale production facilities as and when new natural gas resources are made available, subject to economic evaluations. The company will be headquartered in Marsa El Brega under the leadership of its new CEO, Gianni Paci from Yara, supported by a joint core management team of experienced NOC and Yara executives. According to Dr. Ghanem, Chairman of NOC, “Yara’s participation in the joint venture will add strength to pursue our current modernization and expansion plans for our fertilizer industry. Because Lifeco’s business constitutes Yara’s core business, in which it is a global leader, we have found the ideal partner in Yara. I am confident that this is a win-win situation for all Lifeco stakeholders.”