Apache to Buy 65% Interest in Burrup Fertilisers Plant in Western Australia, Sets Plans for New Technical Ammonium Nitrate Project
HOUSTON, Dec. 18, 2011 /PRNewswire/ -- Apache Corporation (NYSE and Nasdaq: APA) today announced that it will acquire a 65-percent interest in Burrup Holdings Limited and plans to proceed with development of a technical ammonium nitrate (TAN) plant in the Burrup Peninsula region of Western Australia to be developed by a consortium including Burrup Holdings Limited.
Apache said it is also negotiating to sell most of its interest in the TAN project to Orica, an Australia-based global supplier of mining explosives.
Apache has supplied natural gas to Burrup Fertilisers since the plant commenced production in 2006. With a production capacity of 760,000 metric tons annually, the plant is one of the world's largest ammonia production facilities, producing 6 percent of the total world output of tradable ammonia.
"After a year of significant turmoil surrounding the Burrup plant ownership, Apache decided to make this investment in order to stabilize the project and secure a long-term economically viable market for our natural gas production in Western Australia," said G. Steven Farris, Apache's chairman and chief executive officer. "We do not plan to operate the facility; we will rely on those with extensive experience in this sector."
TAN is the main raw material for ANFO (Porous Ammonium Nitrate + Fuel Oil), the most widely used civil explosive currently on the market. The fast-growing iron ore industry in Western Australia's Pilbara region has created increased demand in the niche market for explosives-grade TAN.
Commercial terms of Apache's planned acquisition of the Burrup Holdings interest were not disclosed. Completion of the transaction is anticipated in late January or early February 2012.
Through Apache Energy Limited and other Australian subsidiaries, Apache is a leading producer of natural gas for the domestic Western Australia market.
Apache Corporation is a Houston-based oil and gas exploration and production company with operations in the United States, Canada, Egypt, the United Kingdom North Sea, Australia and Argentina. From time to time, Apache posts announcements, operational updates and investor information, and copies of all press releases on its website, www.apachecorp.com.
This news release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements can be identified by words such as "anticipates," "intends," "plans," "seeks," "believes," "estimates," "expects" and similar references to future periods. These statements include, but are not limited to, statements about the planned acquisition of a 65-percent interest in Burrup Holdings Limited and the development of a technical ammonium nitrate (TAN) plant in Western Australia. While forward-looking statements are based on assumptions and analyses made by us that we believe to be reasonable under the circumstances, whether actual results and developments will meet our expectations and predictions depend on a number of risks and uncertainties which could cause our actual results, performance, and financial condition to differ materially from our expectations. See "Risk Factors" in our 2010 Form 10-K as amended by Amendment No. 1 to our annual report on Form 10-K/A filed with the Securities and Exchange Commission for a discussion of risk factors that affect our business. Any forward-looking statement made by us in this news release speaks only as of the date on which it is made. Factors or events that could cause our actual results to differ may emerge from time to time, and it is not possible for us to predict all of them. We undertake no obligation to publicly update any forward-looking statement, whether as a result of new information, future development, or otherwise, except as may be required by law.
SOURCE Apache Corporation
Posted: December 20, 2011