Norwegian company Yara International has signed an agreement with Orica and Apache to develop a $US700 million ammonium nitrate plant on the Burrup Peninsula in a joint venture.
Yara announced today the companies had signed a heads of agreement to create a joint venture to construct the plant, and to distribute ammonium nitrate and other explosives products to mining customers in the Pilbara.
Yara would operate the 330,000 tonnes per annum plant, while Orica would manage the sales and distribution under the agreement.
Final agreement remains subject to contract negotiations for engineering, construction and procurement, Yara said.
The joint venture is targeting a construction commencement date of mid-2012.
Yara and Orica would each have a 45 per cent interest in the venture, with Apache holding the remaining 10 per cent.
The deal comes just weeks after Yara and Apache jointly acquired full ownership of Burrup Holdings, which operates an existing ammonia plant on the Burrup Peninsula. That ammonia plant will provide feedstock for the planned AN development.
Today's deal also follows Wesfarmers' December 2011 announcement that its CSBP subsidiary will proceed with a $550 million expansion of its Kwinana ammonium nitrate plant, adding 260,000 tonnes pa to its capacity.
