05 August 2013 22:08 [Source: ICIS news]
HOUSTON (ICIS)--Mosaic has entered into a shareholders agreement with mining company Ma’aden and Saudi Basic Industries Corporation (SABIC) to participate in integrated phosphate production in Saudi Arabia, the fertilizer producer announced Monday.
Under the terms of the agreement, Ma’aden will own 60% of the venture with Mosaic having a 25% stake and SABIC retaining 15% ownership of the greenfield project, to be known as Wa'ad Al Shamal, or Northern Promise, Phosphate Project.
The $7bn (€5.3bn) project will be built in the northern region of Saudi Arabia at Wa'ad Al-Shammal Minerals Industrial City, and have additional facilities in Ras Al Khair Minerals Industrial City, which is located on the east coast of Saudi Arabia.
The project is being described as a highly cost-efficient operation and is expected to have an annual capacity of 3.5m tonnes of finished phosphate. Currently officials anticipate that operations will commence in late 2016.
Per the agreement, Mosaic will contribute expertise to the design, construction and operations of the new facilities and will market their ownership percentage of the production including both fertilizer and animal feed. Company officials expect their cash investment to be around $1 billion and pending final approval, will be funded over a four-year period starting this year.
“We are pleased with the progress on our joint venture with Ma'aden and SABIC," said Mosaic President and Chief Executive Officer Jim Prokopanko. "This cost-effective project will allow Mosaic to extend our ability to serve key growing agricultural markets. Our growing global reach further enables us to fulfil Mosaic's mission, to help the world grow the food it needs, while delivering compelling shareholder value.”
($1 = €0.75)
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