Nutrien Inc., a Canadian fertilizer company based in Saskatoon, Saskatchewan, has announced that it is permanently closing its New Brunswick potash facility after putting it on care and maintenance in early 2016. The company will need to issue a writedown of US$1.8-billion in the third quarter due to the closure. Nutrient says that the decision was made to allow for a boost in potash production in Saskatchewan at a lower cost than in New Brunswick.
The company also closed down its Picadilly mine near Sussex, New Brunswick, to focus on lower-cost operations in the other Canadian province. The news came by surprise for the small town of 4,300 after Potash Corp. had been building the facility for about six years at the cost of around $2 billion. Nutrien said then that the closure would save up to US$50 million amid a weak market for the fertilizer.
On top of the closure, Nutrien has also agreed to sell its stake in Arab Potash Co. for $502 million to a Chinese state-owned company. The Canadian fertilizer producer needed to sell the stake to win China’s and India’s approval for the merger of Agrium and PotashCorp into what is now Nutrien. Nutrien’s 23.3 million shares of Arab Potash will be acquired by China-based SDIC Mining Investment Co. Ltd. The company previously announced the divesture of all holdings in Chile-based SQM, some US operations as well as Israel Chemicals Ltd.
