Published by Todd Bush on March 20, 2023
DEERFIELD, Ill.--(BUSINESS WIRE)--CF Industries Holdings, Inc. (NYSE: CF), a leading global manufacturer of hydrogen and nitrogen products, today announced that it has signed a definitive purchase agreement with Incitec Pivot Limited (ASX: IPL) for IPL’s ammonia production complex located in Waggaman, Louisiana. *The facility has a nameplate capacity of 880,000 tons(1) of ammonia annually.
Under the terms of the agreement, CF Industries will purchase the Waggaman ammonia plant and related assets for $1.675 billion. The companies will allocate approximately $425 million of the purchase price to a long-term ammonia offtake agreement under which CF Industries will supply up to 200,000 tons of ammonia per year to IPL’s Dyno Nobel subsidiary. CF Industries expects to fund the remaining $1.25 billion of the purchase price with cash on hand.
“We are pleased to reach this agreement with Incitec Pivot Limited that benefits from our industry-leading ammonia production capabilities, deploys our capital efficiently and provides long-term value for both companies’ shareholders,” said Tony Will, president and chief executive officer, CF Industries Holdings, Inc. “We believe the Waggaman facility will fit seamlessly into our network, as well as our strategic focus on ammonia as a clean energy source, given its proximity and pipeline connection to our Donaldsonville, Louisiana, Complex, its distribution and logistics flexibility, and its favorable characteristics for the addition of carbon capture and sequestration (CCS) technologies to enable low-carbon ammonia production.”
Ammonia produced at the Waggaman facility today is distributed ratably to three customers, including Dyno Nobel, with approximately 75% used in industrial applications. Based on the nature of the medium- to long-term offtake agreements in place with these customers, CF Industries estimates that the plant will generate gross margin per ton commensurate with its existing ammonia segment prior to synergies, which the Company expects to capture through greater capacity utilization and operational and logistics optimization. Over the last five years, CF Industries’ operational capabilities have resulted in ammonia asset utilization that is approximately 10% higher than the average utilization rate of the Company’s North American peers.
Additionally, CF Industries anticipates implementing CCS at the site on an accelerated timeline, increasing its network’s low-carbon ammonia production capability, supporting Louisiana’s and the country’s climate goals, and earning 45Q tax credits for sequestered carbon dioxide.
The transaction has been unanimously approved by the boards of directors of both companies and is subject to receipt of certain regulatory approvals and other customary closing conditions.
Goldman Sachs & Co. LLC is serving as the financial advisor to CF Industries on the transaction. Skadden, Arps, Slate, Meagher & Flom LLP is acting as its legal advisor.
(1) Product volumes in press release are expressed in short tons
The Waggaman, Louisiana, ammonia production complex is situated on an integrated chemicals complex owned by Cornerstone Chemical Company.
>> In Company Spotlight: CF Industries Holdings
At CF Industries, our mission is to provide clean energy to feed and fuel the world sustainably. With our employees focused on safe and reliable operations, environmental stewardship, and disciplined capital and corporate management, we are on a path to decarbonize our ammonia production network – the world’s largest – to enable green and blue hydrogen and nitrogen products for energy, fertilizer, emissions abatement and other industrial activities. Our manufacturing complexes in the United States, Canada, and the United Kingdom, an unparalleled storage, transportation and distribution network in North America, and logistics capabilities enabling a global reach underpin our strategy to leverage our unique capabilities to accelerate the world’s transition to clean energy. CF Industries routinely posts investor announcements and additional information on the Company’s website at www.cfindustries.com and encourages those interested in the Company to check there frequently.
Follow the money flow of climate, technology, and energy investments to uncover new opportunities and jobs.
Inside this Issue 💰 Pajarito Powder Selected for $20 Million in DOE Awards to Build Out Fuel Cell and Green Hydrogen Catalyst Supply Chains 👨👨👦👦 Former FERC Chairman Neil Chatterjee Joins Board...
Inside This Issue 💸 Technip Energies and LanzaTech Selected by the US Department of Energy to Receive $200M Investment for Breakthrough, Replicable Decarbonized Ethylene Commercial Facility 💰 U.S....
Inside this Issue ⛽ ANGI Energy Systems Breaks New Ground by Starting Construction of the Midwest's First Hydrogen Refueling Test Facility ☀️ Solar & Storage Live & The Future Energy Show ...
ATLANTA, March 28, 2024 (GLOBE NEWSWIRE) -- [Chart Industries, Inc.]( https://www.chartindustries.com) (NYSE: GTLS) (“Chart”), a leading global solutions provider to clean energy and industrial ga...
SACRAMENTO, CA, March 28, 2024 (GLOBE NEWSWIRE) -- via NewMediaWire – Today [CuraScientific Corp.]( https://curascientificcorp.com/) (the "Company") (OTCPINK: CSTF) is proud to announce its wholly...
Shell and Verdagy to Collaborate on Renewable Hydrogen Projects
_Shell to Endorse Verdagy Renewable Hydrogen Electrolyzers After Successful, Year-Long, Completion of Detailed Technology, Design and Safety Reviews_ MOSS LANDING, Calif., March 28, 2024 /PRNews...
DUBLIN--([BUSINESS WIRE](https://www.businesswire.com/))--The ["Decarbonizing Aviation and Maritime Industries - 2024"](https://www.researchandmarkets.com/reports/5947913/decarbonizing-aviation-mar...
Follow the money flow of climate, technology, and energy investments to uncover new opportunities and jobs.