Agrium prepares to restart

Posted: Thursday, April 26, 2007

Half of Agrium’s Nikiski complex should be up and running by next week, company officials said Wednesday.

One of the complex’s two urea production plants and one of its two ammonia plants are close to start-up, but await completion of some repairs to broken pipes discovered when start-up procedures began in April, said Plant Manager Chris Sonnichsen.

“We found some broken piping in our primary reformer,” he said. “We started to circulate water and got some leaks. We are in the process of repairs, and should be completing that by the end of this week or over the weekend.”

Agrium has been shut down since late last fall when gas became less available due to wintertime priorities. During the interim, some 150 employees were kept on the job.

“We did a lot of maintenance,” Sonnichsen said.

Sonnichsen said Agrium has gas supply contracts through next fall. Another winter closure is possible, he said.

Agrium has been working to secure long-term gas supplies from Cook Inlet producers for several years. Always in the background has been the chance the company would opt to close the complex completely if an adequate and reliable gas supply could not be found.

Reacting to the gas-supply worries, Agrium began looking at another option a few years ago -- construction of a coal-gasification plant to supply gas and energy for its fertilizer and ammonia plants.

That project, still in feasibility studies, could be large enough not only to supply feed stock gas and electrical power to the complex, but also sell excess electricity to the Railbelt power grid.

In addition, Agrium is looking at the possibility of capturing carbon dioxide gas, which normally would be vented to the atmosphere. Not only would that be good for the environment, but the carbon dioxide could have commercial value. The Cook Inlet oil and gas industry, for instance, might use it in the recovery of more oil and gas.

Sonnichsen said the gasification project is still in the feasibility phase, and that the next decision point may come near the end of summer.

A major funding measure concerning the gasification project passed the Alaska House by a 35-0 vote on Wednesday. House Bill 229 would authorize the Alaska Railroad Corporation to issue up to $2.6 billion in tax-free bonds to help finance portions of the gasification plant’s construction. It would also finance a rail link to Port MacKenzie. The bill now moves on to the Senate.

Hal Spence can be reached at hspence@ptialaska.net.



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