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LSB’s ammonia facility temporarily taken out of service

LSB Industries Inc. has announced that the ammonia plant at its El Dorado, Arkansas, US, chemical facility was taken offline on 4 June 2018 due to a power failure at the facility.

Since that time, LSB claims that it has been assessing the extent of the necessary repairs, and has determined that the power outage resulted in tube failures in the ammonia plant’s boiler. LSB management estimates that these repairs will be completed and ammonia production will resume by the last week of June this year. The total impact to EBITDA in 2Q18 resulting from unplanned repair expenses, reduced absorption of fixed costs relating to the downtime and lost sales will be approximately US$10 million – US$11 million.

In the statement, LSB claims that whilst the plant is out service, work previously planned for the September 2018 turnaround will be pulled forward. This will further shorten the planned turnaround in 3Q18 to five days, from the previously revised 12 days, resulting in additional third quarter production and reduced turnaround expense.

In addition to this, the ammonia plant at LSB’s Pryor, Oklahoma, US, chemical facility was taken out of service for short periods at multiple points during the quarter to repair leaks to the waste heat boiler. Management estimates the second quarter EBITDA impact from the downtime at Pryor to be approximately US$3 million – US$4 million.

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