Apache to Buy 65% Interest in Burrup Fertilisers Plant in Western Australia, Sets Plans for New Technical Ammonium Nitrate Project
Apache said it is also negotiating to sell most of its interest in the TAN project to Orica, an Australia -based global supplier of mining explosives.
Apache has supplied natural gas to Burrup Fertilisers since the plant commenced production in 2006. With a production capacity of 760,000 metric tons annually, the plant is one of the world's largest ammonia production facilities, producing 6 percent of the total world output of tradable ammonia.
"After a year of significant turmoil surrounding the Burrup plant ownership, Apache decided to make this investment in order to stabilize the project and secure a long-term economically viable market for our natural gas production in Western Australia ," said G. Steven Farris , Apache's chairman and chief executive officer. "We do not plan to operate the facility; we will rely on those with extensive experience in this sector."
TAN is the main raw material for ANFO (Porous Ammonium Nitrate + Fuel Oil), the most widely used civil explosive currently on the market. The fast-growing iron ore industry in Western Australia 's Pilbara region has created increased demand in the niche market for explosives-grade TAN.
Commercial terms of Apache's planned acquisition of the Burrup Holdings interest were not disclosed. Completion of the transaction is anticipated in late January or early February 2012 .
Through Apache Energy Limited and other Australian subsidiaries, Apache is a leading producer of natural gas for the domestic Western Australia market.
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