Mosaic to develop $7bn Saudi phosphate JV with SABIC, Ma'aden

19 March 2013 13:35  [Source: ICIS news]

A phosphate processing plantHOUSTON (ICIS)--US fertilizer major Mosaic plans to develop a $7bn (€5.4bn) phosphate fertilizer project in Saudi Arabia in a joint venture with local partners, it said on Tuesday.

Mosaic said it entered into a “Heads of Agreement” with Saudi Arabian Mining Company (Ma'aden) and Saudi Basic Industries Corporation (SABIC) under which the companies intend to enter a joint venture to develop integrated phosphate production facilities at the Wa'ad Al Shammal Minerals Industrial City in northern Saudi Arabia.

The partners expect to enter into a definitive shareholders agreement during the first half of 2013. The project, with a capacity of 3.5m tonnes/year of finished product, is expected to begin production in 2016.

Ma'aden, Mosaic and SABIC would respectively own 60%, 25% and 15% of the joint venture, known as the Wa'ad Al Shammal Phosphate Project, Mosaic said. Subject to final financing terms, the company's cash investment would be up to $1bn, funded over a four-year period beginning in 2013, it added.

The project will involve the development of a mine and chemical complexes to produce phosphate fertilizers, animal feed, food grade purified phosphoric acid and sodium tripolyphosphate for sale to customers worldwide.

Under the terms of the agreement, Mosaic would contribute expertise to the design, construction and operations of the new facilities, it said.

Mosaic would market about 25% of the joint venture's production.

"Our joint venture with Ma'aden holds great promise for Mosaic, and we expect it to be an excellent complement to our phosphate business in Florida and Louisiana," said Mosaic CEO Jim Prokopanko.

"This cost-effective phosphate project would enable Mosaic to further diversify our sources of phosphates and gives us improved access to key agricultural countries,” he added.

($1 = €0.77)

By: Stefan Baumgarten
+1 713 525 2653

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