North Dakota's oil CHS Inc., the nation's largest farmer-owned cooperative, is taking steps toward construction of a more than $1 billion major nitrogen fertilizer manufacturing plant to be located at Spiritwood, N.D. The plant would make fertilizer out of the natural gas coming from North Dakota's oil wells.
The plant is expected to cost between $1.1 billion and $1.4 billion.
"By pursuing this project, CHS would be making a significant, strategic investment that ensures consistent, domestic nitrogen fertilizer supply for our farmer-owners," says Carl Casale, CHS president and CEO. "Today CHS imports fertilizer products from 19 countries. Developing additional domestic crop nutrients sources closer to our customers is critical to meeting increasing demand, improving our logistical and distribution expertise, and adding value for the farmers who count on us."
Gov. Jack Dalrymple says the "potential for this type of project is great news for our farmers and for the entire state of North Dakota. The CHS plant will help us further reduce the flaring of natural gas in western North Dakota and it will provide our farmers with a reliable supply of locally produced fertilizers in place of imports from foreign countries. We will continue working to add value to our energy resources and to develop more locally produced agricultural inputs for North Dakota farmers."
"The ability to deliver a reliable supply of fertilizer products in North Dakota and the region is a win-win for family farmers and our farmer-owned cooperative system," says Woody Barth, president, of North Dakota Farmers Union. "We are pleased that our organization's initial market analysis and feasibility study for building a plant of this scope has allowed us to work closely with CHS, leading to today's announcement."
Preliminary plans call for construction of a plant to produce 2,200 tons of ammonia daily. It will be distributed as anhydrous ammonia, urea and UAN liquid fertilizer to farm supply retailers and farmers in the Dakotas and parts of Minnesota, Montana and Canada. The proposed North Dakota plant takes advantage of abundant regional natural gas feedstock. It could employ between 100 and 150 people, with a tentative start-up in the second half of 2016.
Sources: CHS and ND governor's office