Transaction will save and create jobs while providing an affordable, environmentally friendly, secure supply of essential fertilizer to the region.
Phibro Group to invest $450 million to innovatively convert the plant to an ammonia fertilizer production facility.
STAMFORD, Conn., May 17, 2016 /PRNewswire/ -- Phibro LLC, an independent commodity merchant company, today announced that its affiliate, Philipp Brothers Fertilizer, together with a group of investors ("The Phibro Group"), have acquired SG Solutions' Gasification Plant, a clean coal gasification plant located outside of West Terre Haute, Indiana, that until recently produced synthetic gas and steam to fuel the adjacent Wabash River Combined Cycle Plant owned by Wabash Valley Power Association. The Phibro Group will repurpose the plant to produce ammonia fertilizer for use in the region.
Following the conversion, the plant will use petroleum coke ("petcoke") sourced from Midwest refineries as a feedstock to produce ammonia. Petcoke is more economical than the natural gas many other ammonia plants use as a feedstock and will enable the plant to offer local farmers more affordable fertilizer. The gasification plant's clean coal technology, which was first funded by the Department of Energy more than two decades ago, allows for repurposing it into a world-scale ammonia production plant. There are very few plants in the U.S. with similar technology. The acquisition and conversion of the plant, which had been scheduled to be decommissioned, will not only save existing jobs but also create roughly 100 permanent local manufacturing jobs.
Simon Greenshields, President and Chief Executive Officer of Phibro LLC, commented on the transaction, "We are thrilled to be able to put this plant's technology, which has outlived its viability in an era of reduced coal-fired power generation, to a more productive economic use, manufacturing much needed ammonia fertilizer for the region. This transaction benefits numerous stakeholder groups as it will create and save manufacturing jobs, provide the most affordable fertilizer for farmers in the area and reduce our nation's reliance on imported ammonia fertilizer. We would like to take this opportunity to thank Mr. Jay Bartlett, C.E.O. of SG Solutions and Wabash Valley Power Association, and his entire team for their support and assistance throughout this process. We look forward to commencing work on this project with our partner Quasar Energy Partners."
The Phibro Group plans to invest approximately $450 million into the plant to convert it to produce ammonia and is targeting a mid-2018 completion date.
Nalin Gupta, the Managing Partner of Quasar Energy Partners LLC, commented, "We are proud to partner with the State of Indiana and other local constituents to creatively repurpose and expand existing infrastructure."
Andrews Kurth LLP and Cadwalader, Wickersham & Taft LLP provided the legal advice and services to facilitate the acquisition.