For Immediate Release 21 June 2013
PhosAgro Signs Contract with Mitsubishi Heavy Industries-LedInternational
Consortium for Construction of New Energy Efficient Ammonia Production Facility
in Vologda Region
St. Petersburg - PhosAgro (Moscow Exchange, LSE: PHOR), a leading global
vertically integrated phosphate-based fertilizer producer, announces that it
has signed a contract with an international consortium led by Mitsubishi Heavy
Industries Ltd for construction of a new, energy efficient ammonia production
plant at PhosAgro-Cherepovets in the Vologda region. The new line is expected
to have an ammonia production capacity of 2,200 tonnes/day (760 ths tonnes/
The document was signed during the St. Petersburg International Economic Forum,
with the Russian Federation Minister for Industry and Trade Denis Manturov, the
Governor of the Vologda region Oleg Kuvshinnikov, and PhosAgro Deputy Chairman
of the Board and Vice President of the Russian Union of Chemists Andrey Guryev
The consortium will also include the Japanese company Sojitz and the
Russian-registered company Renaissance Heavy Industries, which will be
responsible for construction work. The licensor of the ammonia production
technology is Haldor Topsoe (Denmark), a leading global engineering company in
Construction of the third ammonia production line at PhosAgro-Cherepovets is a
key part of PhosAgro's long-term modernisation and growth strategy. Project
development was led by the National Mineral Resources University (St.
Petersburg) and is aimed at a ground-up modernisation of the Company's
production technologies using the best available technologies.
The commissioning of the new ammonia plant at PhosAgro-Cherepovets is planned
for the first half of 2017. The new facility will be the highest-capacity of
any ammonia lines currently functioning or under construction in Russia. With
the launch of the new ammonia plant, PhosAgro's total ammonia production
capacity will increase by nearly 70%.
Total investments in the new ammonia facility and related infrastructure, which
PhosAgro plans to finance from its own cash flows and with third-party funding,
are expected to be USD 785 million.
The new ammonia production facility will rank among the best in the world in
terms of characteristics like raw materials and energy consumption, labour
productivity, up-time between repairs, as well as environmental impact. Natural
gas consumption per unit if production is expected to be 20% lower than the
current average for ammonia production facilities in Russia.
In order to supply the new ammonia line with hydrocarbon raw materials, Gazprom
has agreed to supply an additional 800 million cubic metres of gas per year to
PhosAgro following the launch of the new facility. The Russian Ministry of
Economic Development has also confirmed the use of natural gas in the new
ammonia production line.
PhosAgro CEO Maxim Volkov said: "The construction and commissioning of the new
ammonia plant at our PhosAgro-Cherepovets site will mark a new phase in
PhosAgro's development, strengthen its market-leading position, create new jobs
and improve production efficiency. The project is designed to achieve one of
PhosAgro's key strategic goals of increasing internal processing of its own
phosphate rock to produce higher volumes of phosphate-based fertilizers."
For further information please contact:
+7 495 232-96-89
Irina Evstigneeva, Head of Corporate Finance and Investor Relations
Timur Belov, Press Officer
+44 (0) 20 7920 2356
Notes to Editors
PhosAgro is a leading global vertically integrated phosphate-based fertiliser
producer. The Group focuses on the production of phosphate-based fertilisers,
feed phosphate and high-grade phosphate rock (with P2O5 content of not less
than 39 percent), as well as ammonia and nitrogen-based fertilisers.
The Group is the largest phosphate-based fertiliser producer in Europe, the
largest producer of high-grade phosphate rock worldwide and the second largest
MAP/DAP producer in the world (excluding China), according to Fertecon.
PhosAgro is also a leading producer of MCP feed phosphates in Europe, and the
only producer in Russia.
PhosAgro has 2.1 billion tonnes of resources (according to JORC) of high
quality apatite-nepheline ore, representing over 75 years of production. The
Group also controls substantial Al2O3 resources and has 41% of Russia's rare
earth oxides resources (according to the G.P. Luzin Institute of Economic
Problems of the Kolskiy Scientific Centre of the Russian Academy of Sciences,
The Group's mines and phosphate rock production facilities are located in the
mountainous areas of the Kola Peninsula in the Murmansk region of northwest
Russia, whereas its fertiliser and feed phosphate production assets are located
near the city of Cherepovets in the Vologda region and near the city of
Balakovo in the Saratov region of southwest part of European Russia. PhosAgro's
2012 IFRS revenue was over USD 3.4 bln and EBITDA was USD 1.1 bln. The
net debt/EBITDA ratio was 0.77 at 31 December 2012.
For further information on PhosAgro please visit: www.PhosAgro.com
-0- Jun/21/2013 08:22 GMT
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