Agrium explores reopening its Nikiski plant

Following an earlier announcement that Agrium filed for an air quality operations permit from the state, the company said more permits would be required before reopening.

The company’s plans to investigate a reopening of its Nikiski fertilizer plant have not changed, said Agrium spokesperson Adam Diamond in an email.

Once the largest private employer in the Kenai Peninsula Borough, Agrium shut down the Nikiski plant at Mile 21 on the Kenai Spur Highway in 2008 saying there was a shortage of available natural gas on the Kenai Peninsula.

The plant uses a large volume of natural gas to convert base materials into fertilizers.

Diamond said that the application for the air permit with the Alaska Department of Environmental Conservation should not be seen as an indication that the plant will restart. Several “key hurdles” remain, such as a Prevention of Significant Determination permit from the DEC and access to more natural gas than is available.

“However, the lead time necessary to acquire this permit requires that we begin the process now so that we are in a position to begin work on the facility if there was a decision to proceed,” Diamond said. “It is important to note that Agrium could withdraw the permit application in the event of an internal decision to not proceed with the expansion project.”

ExxonMobil Corp., BP PLC, ConocoPhillips, and TransCanada Corp. are on record saying that Nikiski is the preferred site for the South Central Alaska Liquefied Natural Gas project, the terminus of an 800-mile pipeline that could be complete by 2019.

According to the project overview created in January for the Alaska State Legislature, the LNG plant would process up to 864 billion cubic feet or 18 tons of gas annually.

Chief Operating Officer Chuck Magro told Reuters earlier this month that he felt there was not enough natural gas available locally to restart the plant.

“But there is a lot of gas drilling in the Cook Inlet again, and we are working with the gas companies to determine if there is a possibility to restart those assets,” said Magro.

Greg Skinner is a reporter for the Peninsula Clarion. He can be reached at greg.skinner@peninsulaclarion.com.

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