Orica Explosives Growth To Continue
22nd July, 1998
Orica Limited Managing Director, Philip Weickhardt, welcomed today’s announcement that the company plans to form a joint venture for the production and sale of ammonium nitrate in Mexico.
"I am delighted that we have been able to make such a strategically important announcement so soon after the acquisition of the explosives businesses in Europe and the Americas. This investment will form a sound platform for future growth of our Latin American business," Mr Weickhardt said.
The new joint venture, involving an investment by Orica of US$25million, will bring together the Grupo Acerero del Norte, S.A. de C.V. (GAN) 270,000 tonnes ammonium nitrate plant at Coatzacoalcos in the State of Veracruz, Mexico and Orica’s 65,000 tonnes plant at Monclova in the State of Coahuila, Mexico. The Coatzacoalcos plant is currently being modified and expanded to 360,000 tonnes and will be the lowest cost manufacturer in the markets it will supply.
Explosives and other mining services is one of the four identified growth platforms of Orica, the others being agrochemicals, consumer products and chemicals.
"Since acquiring the European and Americas explosives businesses on 1 May, we have worked closely with explosives CEO Peter Clinch to progress the detailed post acquisition plan developed by Orica and to identify further priority business enhancement initiatives. We are actively pursuing a number of growth opportunities, and we are also making structural changes to give the business the most appropriate base on which to build," Mr Weickhardt said.
The changes to the business structure include consolidating the international and United States business headquarters from Toronto and Dallas to a new office to be established in Denver.
Orica is the world’s largest supplier of commercial explosives with a market share of around 20 per cent.