Yara BASF Ammonia Plant, Freeport Verbund, Texas, United States of America

Ammonia production plant in Freepoer, Verbund, TX, US

The joint venture (JV) of Yara International (68%) and BASF Group (32%) is constructing a new world-scale ammonia production plant at the latter's Freeport Verbund site in the US. The former will manage the construction activities, while the latter will operate the plant and the integrated export terminal.

Plans to form the JV were initiated in 2013, the announcement was made in May 2014, the JV was officially formed in February 2015 and the project broke ground in July 2015. The facility is scheduled to begin production in late 2017.

"Yara and BASF have decided to off-take the produced ammonia at a rate equivalent to their respective equity share in the JV."

The total construction cost of the project is estimated to reach $600m, of which Yara International's investment will be $490m. The project is expected to generate approximately 550 jobs at the peak of construction and 35 full-time jobs when it comes online.

Ammonia off-take and application

The new plant will have an ammonia production capacity of 750,000t a year and will use hydrogen as feedstock. Yara and BASF have decided to off-take the produced ammonia at a rate equivalent to their respective equity share in the JV.

BASF will use the ammonia produce caprolactam, a key ingredient in the manufacture of nylons for carpet, textiles, film, monofilaments, wire and cable, whereas Yara International will primarily supply its share of ammonia from the plant partly to customers in North America and the remainder to the agricultural sector in the US.

Feedstock supplier

The JV signed an agreement with Praxiar, the biggest industrial gases company in North America, for the latter to supply 170 million standard cubic feet per day (Mmscfd) of hydrogen and 2,000t a day of nitrogen for the new plant. The supply agreement is for a 20-year period.

Technology licensor and EPC contractor for the Yara-BASF plant

The technology licensor and engineering, procurement and construction (EPC) contractor for the project is KBR.

BASF Brazil inaugurated its world-scale integrated production complex for acrylic acid, butyl acrylate and superabsorbent polymers (SAP) in Brazil in June 2015.

KBR has decided to license its ammonia synthesis technology for the plant. The technology, using hydrogen as feedstock, is expected to significantly reduce the plant's capital expenditures (capex), maintenance and CO2 emissions compared to traditional natural gas-based ammonia plants.

Yara BASF ammonia plant construction

In addition to the construction of the facilities for the new plant, Yara will also build an ammonia tank at the project site, while BASF will upgrade its existing terminal and pipeline infrastructure.

Owing to the demands of the new ammonia plant, Praxiar, the feedstock supplier, has also decided to invest more than $400m to increase its hydrogen and nitrogen production capacity and extend its existing Gulf Coast pipeline systems by approximately 46mi (74km approximately) from Texas City to the Yara BASF JV's project site in Freeport.

BASF's Freeport Verbund site details

BASF's Freeport Verbund site, which came online in 1958, is its first manufacturing site outside Europe. The site covers an area of approximately 575 acres, 275 acres of which were vacant for development as of December 2014.

The site currently houses 25 plants producing 24 different products, mainly comprising basic chemicals, intermediates and fibre intermediates. The site employs more than 850 workers and 840 contractors.