ICI Australia Invests $90 Million to Create World-Scale Ammonium Nitrate Plant

31st October, 1997

ICI Australia will continue to use its strong technology base in Films and Engineering Plastics to supply added-value products to local and world markets.

ICI Australia today announced it will invest $90-$100 million to double the capacity of its Ammonium Nitrate (AN) plant at Yarwun in Queensland. The expanded plant will be commissioned in early 2000 with a total capacity of 440,000 tonnes, making it one of the world's largest.

ICI Australia Explosives general manager Mr Alan King said, "This decision reflects our determination to meet future demand through establishing an AN facility which is truly world-scale. In addition to unit cost savings, which will most certainly benefit all our Queensland customers, this move will enable us to export AN to Asia ahead of the commissioning of our proposed AN plant at Bontang in Indonesia.

"The Yarwun expansion will enable us to supply the Queensland and selected Asian AN markets. In addition to this, the capacity of the Incitec Newcastle AN plant will also be increasing in early 1999. The Newcastle plant will expand by 150,000 tonnes to 450,000 tonnes and this volume will put us in an excellent position to supply remaining markets throughout Australia with cost effective AN. The capital cost of this increase is $50 million.

"We currently still import over 50,000 tonnes per annum of AN. We plan to replace these imports with product manufactured locally, a decision which will boost Australia's balance of payments."

Mr King said the company has a two-stage plan to provide the Queensland AN plant with a cost-effective, long-term supply of ammonia feedstock for the manufacture of AN and other nitrogen-based products. Stage one is the previously announced Yarwun ammonia import terminal, scheduled for construction early next year. A significant amount of the ammonia sourced for the terminal will be domestic product from Brisbane.

Stage two of the plan is the establishment of a large-scale ammonia plant at the Yarwun site, which is currently the subject of a detailed feasibility study. The supply of gas to Gladstone will provide an economically attractive opportunity for the establishment of a fully integrated world-scale AN facility. Following commissioning of an ammonia plant, the import terminal would be used as an ammonia storage facility which would store feedstock for use during maintenance shutdowns.

"These combined projects underline ICI Australia's commitment to be the lowest cost AN producer in the Asia Pacific region and support future growth in the mining industry," said Mr King. "The low incremental capital cost of expanding these plants gives a very efficient opportunity to supply the rapidly growing AN markets in the region."