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Several informed sources in the market report that SBU Azot is in the advanced stages of negotiations with JSC Ammoniy and Mendeleevsk Azot over the purchase of the Mendeleevsk nitrogen production assets in Tatarstan. The reports suggest that the marketing of the Mendeleevsk granular urea will be handled by SBU following the completion of the deal. This would allow SBU flexibility to offer combination cargoes including prilled and granular urea into central, Latin America and North America, as well as other markets.
It is unclear exactly when the purchase could be complete with some reports suggesting it could be as soon as November this year.
The Tatarstan facility under discussion has an annual granular urea capacity of 718,000t with ammonium nitrate production at 380,000t/y. Production commenced for ammonia in August 2015 and was followed by urea in 2016.
SBU’s Kemerovo facility started production in the early 1980s and produces prilled urea with annual capacity of 450,000t.
Both companies were approached in advance of this article for comment. Other companies linked with earlier negotiations are understood to no longer be in discussions regarding the plants. As reported in April, Eurochem and Lukoil were interested in taking over Mendeleevsk’s facilities with local reports at the time putting the bid at $1bn.
Originally published via the Profercy Nitrogen Service on 27 September 2019
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