LOS ANGELES--(BUSINESS WIRE)--
Rentech Nitrogen Partners, L.P. (RNF), which manufactures and sells nitrogen fertilizer products including ammonia, UAN solution and ammonium sulfate, today announced it has commenced engineering for a 15 megawatt electrical power generation project at its facility located in Pasadena, Texas.
The Partnership intends to install a steam turbine/generator set that would use excess steam produced from the sulfuric acid plant at the facility to produce electrical power. It is expected that a portion of the power will be used in the Pasadena Facility, reducing electricity expenses, and the remaining power will be sold in the deregulated Texas power market, creating an additional revenue stream. Rentech Nitrogen expects that this project would be completed in the fall of 2014 and would begin contributing to per unit cash available for distribution in the first quarter of 2015. The project is estimated to cost approximately $30 million and is fully-funded from proceeds from the Partnership’s recently completed senior secured notes offering. Rentech Nitrogen has engaged Abengoa to carry out the engineering, design and construction (EPC) of the power generation portion of the project under a lump sum turnkey EPC contract over 18 months. The project is currently projected to have a return of approximately 20%.
D. Hunt Ramsbottom, CEO of Rentech Nitrogen GP, LLC, stated, “We’re pleased to have the financing in place to move the power generation project forward under a lump sum turnkey EPC contract. With the commencement of this project and the ammonium sulfate capacity expansion, we are now executing on two of the three growth opportunities to increase cash distribution per unit we identified at the time of the acquisition of the Pasadena Facility late last year. We continue to explore the most profitable opportunities to use our favorable location on the Houston Ship Channel to begin terminalling or other activities in unused space on our site.”
About Rentech Nitrogen, L.P.
Rentech Nitrogen (www.rentechnitrogen.com) was formed by Rentech, Inc. to own, operate and expand its nitrogen fertilizer business. Rentech Nitrogen’s assets consist of two fertilizer production facilities owned by its operating subsidiaries. Rentech Nitrogen’s East Dubuque Facility is located in the northwestern corner of Illinois, and uses natural gas as a feedstock to produce primarily anhydrous ammonia and UAN solution for sale to customers in the Mid Corn Belt. Rentech Nitrogen’s Pasadena Facility is located in Pasadena, Texas along the Houston Ship Channel. Rentech Nitrogen is the largest producer of synthetic granulated ammonium sulfate fertilizer in North America, with sales in the United States and South America. The Pasadena Facility’s other products, which are sold domestically, include ammonium thiosulfate fertilizer and sulfuric acid. The facility uses ammonia and sulfur as its primary feedstocks.
Forward Looking Statements
This press release contains forward-looking statements about matters such as the power generation project’s projected timeline, cost and impact to per unit cash available for distribution. These statements are based on management’s current expectations and actual results may differ materially as a result of various risks and uncertainties. Other factors that could cause actual results to differ from those reflected in the forward-looking statements are set forth in Rentech Nitrogen’s prior press releases and periodic public filings with the Securities and Exchange Commission, which are available via Rentech Nitrogen’s website at www.rentechnitrogen.com. The forward-looking statements in this press release are made as of the date of this press release and Rentech Nitrogen does not undertake to revise or update these forward-looking statements, except to the extent that it is required to do so under applicable law.
Julie Dawoodjee Cafarella
Vice President of Investor Relations and Communications