MELBOURNE, Australia,
Feb. 13, 2014 /PRNewswire/ --
Orica Limited
ABN 24 004 145 868
ASX Announcement
Orica enters a long-term Ammonium Nitrate supply agreement for
North American operations with CF Industries Inc.
Orica (ASX: ORI) has entered into a long-term Ammonium Nitrate
(AN) supply agreement with CF Industries Inc. (CF) to supply up to
800,000 short tons per annum for its North American operations.
The AN supply agreement for Industrial Grade AN (IGAN) and AN
Solution (ANS) is for ten years from January
2017 with an option for Orica to extend for a further five
years until the end of 2031.
CF will supply IGAN and ANS product from their Yazoo City manufacturing facility in
Mississippi, USA. In conjunction
with Orica's other supply agreements and own manufacturing plants
in Carseland (Alberta, Canada) and
Geneva (Utah, USA) the agreement with CF will meet
current demand while also providing room to support expected market
growth in North America.
Under the agreement Orica will maintain an equivalent cost base
across its AN supplier network compared to the current cost
profile.
Future contract prices will be based on; the lower of a
combination of inflation and gas price movements, or CF's market
prices for explosive products. Should gas prices change in the
future, AN cost volatility will be limited as only a minor
component is gas linked.
Orica Managing Director and CEO Ian
Smith said: "This important agreement with CF Industries
provides long-term certainty of supply to Orica's customers across
North America".
14 February 2014
- Analysts' Contact: Karen McRae,
General Manager Investor Relations +61 3 9665 7844 Mobile: +61 417
186 500
- Media Contact: Simon Westaway,
General Manager Communications +61 3 9665 7183 Mobile: +61 401 994
627
www.orica.com
www.twitter.com/OricaLimited
SOURCE Orica Ltd