Algerian ammonia giant Fertial to invest $370m in expansion project

ISTANBUL (ICIS)–Major new investment that will boost production capacity at Fertial’s two ammonia plants is scheduled to get underway in 2016, a source at the Algerian fertilizer manufacturer revealed on Monday.

As part of the $370m revamp, the firm’s nitrogen phosphorous potassium (NPK) capacity at its Annaba site will be doubled to 600,000 tonnes/year in a move that could create limited export availability for the compound crop nutrient.

Speaking on the sidelines of this year’s annual conference of the International Fertilizer Industry Association (IFA) in Istanbul, the person familiar with the matter said the capital expenditure would boost total ammonia output by at least a third.

Annual ammonia production capacity at Annaba will be increased from 300,000 tonnes to 400,000 tonnes and raised by 50% at units at its main Arzew complex – from 300,000 tonnes to 450,000 tonnes.

Houston-headquartered technology firm KBR has been chosen for the revamp of the two main ammonia plants at Annaba and Arzew, while Swiss firm Casale will update the old Chemico plant at Arzew.

All ammonia not used in the production of NPKs will be exported via sales tenders held every six months, “although we are hearing the government may look to hold such tenders every three months instead”, the source said.

Fertial expects to next issue such a tender in September, with around 300,000 tonnes of the nitrogen fertilizer available for loading over a six month period.

Earlier this year, the manufacturer awarded its 21 February sales tender for 380,000 tonnes of ammonia priced under formula to Spain’s Fertiberia and Norway’s Yara, with each of the buyers awarded 190,000 tonnes.

Fertial is owned by Asmidal – whose parent is Algerian natural gas giant Sonatrach – and Fertiberia.

This year’s IFA conference runs from 23-25 May.