A planned nitrogen production facility in Spiritwood, North Dakota has been put on hold. CHS had intended to build the facility to service nitrogen demand in the northern plains, but because of the added expense of building a service road, CHS has decided to pass on North Dakota nitrogen.
"The money spent on the road projects will be billed back" to CHS, said Casey Bradley, Stutsman County auditor/chief operating officer. That will happen whether or not the fertilizer plant project goes forward.
The company is hoping the community will leave the door open to future negotiations, but that is uncertain. "CHS has requested the county negotiate an option to purchase the right-of-way land from the landowners", Bradley said. Right-of-way purchase agreements had already been penned and were set to close on April 15.
"They would like us to negotiate that. I don't know if that's something we would do," Bradley said, noting that would mean the county negotiating a legal document between two other groups - CHS and the landowners.
Meanwhile, Northern Plains Nitrogen (NPN), another production startup near Grand Forks is moving forward, gathering capital and permits. The decision by CHS not to build in North Dakota is viewed as a positive for NPN and an industry expert told the Inputs Monitor today, "investors like to have the playground to themselves when it comes to something like this. NPN has the clear advantage in North Dakota."
So as one nitrogen facility is tabled, another gains a clear shot at the nitrogen market in the northern plains. Domestic nitrogen production is on the rise nationally and new projects will start to come online in 2016. The U.S. will rely on imported nitrogen into the foreseeable future to fill a portion of annual demand on the farm, but domestic production will dramatically reduce reliance on foreign sources.
Quotes provided by the Jamestown Sun