LSB Industries, Inc.'s El Dorado Facility Signs Contract for a New Nitric
Acid Plant, and Completes Reconstruction and Resumes Production at Its
Sulfuric Acid Plant
OKLAHOMA CITY -- December 04, 2012
LSB Industries, Inc. (the “Company”) (NYSE: LXU) today announced that its
chemical business’ El Dorado, Arkansas facility (“El Dorado Facility”) has
signed an agreement with Weatherly Inc. for the licensing, engineering, and
procurement of major manufacturing equipment for a new 1,100 ton per day 65%
strength nitric acid plant. The new plant is expected to be operational by
In addition, the Company is currently negotiating a contract for the purchase
of a plant to work in conjunction with the new nitric acid plant that further
concentrates a portion of the output up to 98.5% strength.
The cost of the new nitric acid plant, the nitric acid concentrator plant and
supporting facilities, including construction, is anticipated to total
approximately $120 million, a significant portion of which is expected to be
paid from insurance proceeds resulting from the May 15, 2012 event that
damaged the El Dorado Facility. The amount of insurance proceeds is not known
at this time.
The Company also announced today the recommencement of operations at the El
Dorado Facility’s sulfuric acid plant. This represents the final phase of
repair and production recovery at the facility following the May 15, 2012
event, other than the construction of the aforementioned new nitric acid plant
and acid concentrator plant.
Jack E. Golsen, LSB’s Board Chairman and CEO stated, “All of the plants at the
El Dorado Facility are up and running, other than the DSN plant, which is
being replaced by the new Weatherly nitric acid plant. With the addition of a
new nitric acid plant and concentrator, we believe that the El Dorado Facility
will be able to regain its position as a leading merchant marketer of
concentrated nitric acid in the United States.”
LSB is a manufacturing and marketing company. LSB’s principal business
activities consist of the manufacture and sale of chemical products for the
agricultural, mining, and industrial markets and the manufacture and sale of
commercial and residential climate control products, such as geothermal and
water source heat pumps, hydronic fan coils, modular geothermal chillers, and
large custom air handlers.
This press release contains certain forward-looking statements within the
meaning of the Private Securities Litigation Act of 1995. These
forward-looking statements generally are identifiable by use of the words
“believe,” “expects,” “intends,” “plans to,” “estimates,” “projects” or
similar expressions, and such forward-looking statements include, but are not
limited to, total cost of the new plants including construction, amount of
insurance proceeds, construction and commissioning activities, improvement of
the El Dorado Facility, ability to regain its position as a leading merchant
marketer of concentrated nitric acid. Investors are cautioned that such
forward-looking statements are not guarantees of future performance and
involve risk and uncertainties, and that actual results may differ materially
from the forward-looking statements, as a result of various factors,
including, without limitation, general economic conditions, negotiations with
our insurance company, ability to obtain replacement and repair equipment and
parts in a timely manner, weather conditions, labor conditions, and other
factors set forth under “A Special Note Regarding Forward-Looking Statements”
in our Form 10-K for year ended December 31, 2011, and the Form 10-Qs for the
quarters ended March 31, 2012, June 30, 2012 and September 30, 2012.
LSB Industries, Inc.
Tony M. Shelby, 405-235-4546
Chief Financial Officer
The Equity Group Inc.
Linda Latman, 212-836-9609
Fred Buonocore, 212-836-9607
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