Agrium extends deadline for gas proposals

Posted: Sunday, April 17, 2005

Agrium spokesperson Lisa Parker said at Thursday's Nikiski Chamber of Commerce luncheon that the deadline for gas producers to respond to the company's request for additional gas to continue operating the plant has been extended to May 13.

The Calgary-based fertilizer producer, which plans to close Oct. 31, issued requests for proposals to all seven gas producers in the Cook Inlet basin to buy additional gas per year at $3 per thousand cubic feet. The deadline was originally set for Friday. Parker said some producers wanted more time to respond.

In a March interview, Parker said the company would need to secure 24 billion cubic feet of gas per year to continue operating.

The offering price is lower than the company's previous target price. Last year, Agrium operated its North Kenai fertilizer plant at 75 percent and consumed 39.4 billion cubic feet of gas.

Parker was asked about her feeling on whether the company will receive additional gas to continue operating beyond Oct. 31.

She said she did not believe the company would get sufficient gas to continue.

Jim Senn, business support manager for Agrium, added that it is difficult to say what will happen until all responses from gas producers are received and reviewed.

At the luncheon, Parker highlighted other avenues the company is using to try to get additional gas. She said Agrium has a petition before the Regulatory Commission of Alaska to regulate the Cook Inlet Gathering System. CIGS is a high gas line that delivers high pressure gas from the west side of the inlet to the east side. Right now that pipeline is owned by Marathon Oil Co. and Unocal Corp. and is unregulated, meaning Agrium cannot access additional gas via that pipeline. The petition is to make that a regulated line.

Referring to the shutdown plan, Parker said Agrium recently shed 12 employees from its work force, leaving 190 people left working at the plant. This was in its original shutdown plan, she said.

A voluntary committee has been named consisting of management and hourly workers to look at ways to assist employees losing jobs. Information has been posted on Agrium's internal Web site with information and links to other helpful Web sites for employees.

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