Northern Plains Nitrogen seeking loan for nitrogen plant

04 October 2013 22:03  [Source: ICIS news]

HOUSTON (ICIS)--Northern Plains Nitrogen is applying for a loan from the city of Grand Forks in North Dakota to assist with purchasing land upon which its plans to build a nitrogen fertilizer facility, the company said on Friday.

On 9 October, representatives of Northern Plains will appear before the city’s Growth Fund Committee and request a $250,000 (€182,500) loan to facilitate the acquisition of approximately 320 acres east of the city.

The total purchase price for the site $1.7m. Previously Northern Plains has estimated that the nitrogen plant will have a price tag of $1.5bn. The company said it still expects to break ground in the spring of 2015 and have production start during 2017.

The plant is anticipated to have a rate of production of approximately 600,000 tons/year (544,000 tonnes/year) of nitrogen based fertilizers, primarily ammonia and urea, and create up to 135 full-time jobs.

Grand Fork officials said if the loan is approved, it will be combined with a $250,000 loan from the North Dakota Development Fund and packaged with approximately $1.2m from the company’s own private loan and investor equity funds. The funds from the state are contingent on the approval of the Grand Forks committee.

Northern Plains Managing Partner Darin Anderson said if the application is approved, the company should be able to close the land purchase by the end of the year.  

State officials have been enthusiastic about the project, which is viewed as means to utilise the increasing supplies of natural gas across the region and provide a reliable regional supply of fertilizer while reducing producers’ dependence on imported products.

The facility will convert gas currently being flared from oil wells in western North Dakota. The natural gas would be captured and transported to the plant via pipelines.

Northern Plains has said they intend on targeting the company’s sales efforts to buyers in the central US region and into Canada, specifically Manitoba and Saskatchewan. As of now there are no nitrogen manufacturing facilities in North Dakota.

($1 = €0.73)

By: Mark Milam
+1 713 525 2653

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