OCI Announces Start Of Construction Work On Iowa Fertilizer Company
Orascom Construction Industries (OCI) (OCIC.CA) announced on Monday that its wholly owned subsidiary, Iowa Fertilizer Company (IFCo), held a groundbreaking ceremony to mark the start of construction work on its new greenfield nitrogen fertilizer production plant in Wever, Iowa.
IFCo will be the first world scale natural gas-based fertilizer plant built in the United States in nearly 25 years and will help reduce the United States’ dependency upon imported fertilizers.
Featured speakers at the event included Chairman and Chief Executive Officer (CEO) of OCI Nassef Sawiris, Iowa Governor Terry Branstad, Director of Iowa Economic Development Authority (IEDA) Debi Durham, and Lee County Supervisor Larry Kruse.
Governor Branstad commented: “The Iowa Fertilizer Company plant is one of the largest investments ever in the state of Iowa. I am pleased to be breaking ground today and moving forward with our efforts to bring thousands of jobs to this area and to provide our farmers access to affordable fertilizer. This project will help rejuvenate Lee County and all of Iowa at a time when it is needed most.”
Lieutenant Governor Kim Reynolds commented: “All of Iowa will see and feel the positive economic impact of this project. Iowa Fertilizer Company is bringing hundreds of millions of dollars into the state that will directly benefit local outlets such as public schools. This groundbreaking marks a step in the right direction for economic growth and a successful future for the state of Iowa.”
OCI Chairman and CEO Nassef Sawiris commented: “In November 2011, Iowa Fertilizer Company was just an idea. Today, after much hard work by local and state officials, we celebrate the start of construction work on our new US$ 1.4 billion fertilizer plant, which represents the largest investment project ever undertaken in the state. We would also like to thank the community in Lee County for its support of our project and reaffirm our commitment to utilize local suppliers, contractors and workers whenever possible and involve ourselves in this community.”
During the event, IFCo signed an agreement with the ANR Pipeline Company, a subsidiary of TransCanada Corporation, covering terms for the long term transportation of natural gas to the plant, an agreement with Citigroup to serve as the lead underwriter of its bond financing issuance, and an agreement with Iowa-based McAninch Corporation to undertake the initial earthmoving and grading works on the site.
The Iowa Finance Authority’s Board of Directors unanimously approved the issuance of up to US$ 1.2 billion in Midwest Disaster Area bonds by Iowa Fertilizer Company on November 16. As the borrower, IFCo will be solely responsible for the repaying the debt and the rates and terms of the bonds will be based on its creditworthiness. The Iowa Department of Natural Resources approved the issuance of air permits for the new plant on October 26. The new plant will utilize the best available emissions control technologies and comply with all state and federal emissions requirements.
Iowa is the top producer of corn in the United States, and cultivates over 30 million acres annually. Iowa has the highest use of nitrogen-based fertilizer in the nation, and IFCo will be well positioned to satisfy Iowa’s demand for nitrogen-based fertilizers.
