CF Fertilisers announces £40m facelift for Billingham AN plant

(update adds new Yara pricing information in paragraph 10)

LONDON (ICIS)–CF Fertilisers is planning a two-year, £40m ($56m) facelift for its Billingham, UK, ammonium nitrate (AN) plant, the UK subsidiary of CF Industries announced on Tuesday.

The investment is an answer to increased domestic demand, according to CF Billingham site manager Keith Brudenell

“We are developing the plant to keep pace with [demand], and to meet the challenges of the future,” he said

The producer will invest £15.8m in the plant’s electrical infrastructure, adding 40 years to the powerplants’ lifespan.

A further £15.5m will be used to upgrade Billingham’s ammonia reforming plant, extending its life by 20 years.

“This will involve replacement of the steam reforming equipment and gas transmission piping on the high temperature part of the plant, and our aim is to complete the upgrade by 2020,” Brudenell adds.

Finally, £8m will be used to replace equipment at one of Billingham’s acid plants.

The investment is the County Durham site’s largest for 20 years, and will create more than 100 temporary jobs over the two-year project.

CF recently rolled over its February-March pricing for AN into April deliveries, setting the delivered price for all three months at an equivalent to £238/tonne FCA (free carrier) bagged.

Competing AN supplier Yara, meanwhile, has matched CF’s pricing for new deliveries, setting its list price at an equivalent to £239-242/tonne FCA, depending on the size of purchase.

Domestic AN demand is strong in the UK, but local product is facing stiff competition from international AN imports.

(£1 = $1.39)