Ma'aden signs $7bn phosphate plant deal
Riyadh, March 19, 2013
The Saudi Arabian Mining Company (Ma’aden) has signed an agreement with Sabic and the US-based Mosaic Company to develop a SR26 billion ($7 billion) fully integrated, world-class phosphate production facility in Saudi Arabia.
Ma’aden will own 60 per cent, Mosaic 25 per cent and Sabic 15 per cent, said a statement.
The new complex will be one of the largest integrated phosphate facilities in the world and will approximately double Ma’aden’s existing phosphate production while adding important new products to Ma’aden’s production capabilities.
The project will include new mining and processing plants in the kingdom at Wa’ad Al Shammal Mineral Industrial City, as well as further processing plants at Ras Al Khair Mineral Industrial City.
The two sites will be linked by the North-South Railway. Production at the new facilities is expected to commence in late 2016 with a total production capacity of approximately 16 million tonnes per year, said the statement.
The facilities will produce, as finished product, approximately 3 million tonnes of fertiliser products such as DAP/MAP and NP/NPK, as well as approximately 440,000 tonnes of downstream products including purified phosphoric acid (PPA) used in food industries, sodium tripolyphosphate (STPP) used in detergent manufacturing, and Dicalcium Phosphate & Monocalcium Phosphate (DCP/MCP) used in the manufacturing of animal feed.
Khalid Al-Mudaifer, president and CEO of Ma’aden, said: “This project represents not only an important milestone in Ma’aden’s growth, but it will also be an important contributor to the development of the Northern Region of Saudi Arabia as it will include the first major industrial project to be constructed in the region.
“The partnership with Mosaic and Sabic brings great value to the project in terms of technical, operating and marketing experience and we expect this project to be an industry leader in terms of its operational excellence, commitment to sustainability and contribution to the socio-economic development of the Kingdom.”
The development of local communities in the north of the Kingdom will be a key benefit of this project. In addition to direct employment opportunities of nearly 1,500 jobs, a coordinated program of regional development will also be undertaken, said the statement.
The joint venture partners are developing plans for a local research and development facility which will encourage the study and development of phosphate products and processes.
As part of infrastructure development, Ma’aden will also partner with the Technical Vocational Training Corporation to develop a specialized training centre in Wa’ad Al Shammal.
“Our joint venture with Ma’aden holds great promise for Mosaic, and it will be an excellent complement to our phosphate business in Florida and Louisiana,” said Mosaic president and chief executive officer Jim Prokopanko. “This cost-effective phosphate project enables Mosaic to further diversify our sources of phosphates and gives us improved access to key agricultural markets. Our growing global reach further enables us to fulfill Mosaic’s mission, to help the world grow the food it needs, while delivering compelling shareholder value.”
Mohamed Al-Mady, Sabic vice-chairman and CEO, said: “Sabic and others are working as swiftly as possible to provide the necessary ingredients for the development of new value chains within our current economic structure.” – TradeArabia News Service