Chemicals manufacturer Incitec Pivot (ASX:IPL)
has secured a prospective annual supply of up to 2.3 million tonnes of granular urea fertiliser for 20 years.
Australia’s largest supplier of fertilisers has agreed to an offtake deal with Western Australia-based Perdaman Chemicals and Fertilisers.
The $5.1 billion company’s fertilisers division will have access to fertiliser product from Perdaman’s $4.5 billion urea manufacturing facility in the Pilbara region’s Karratha area.
The conditional agreement will only take effect if Perdaman can secure funding for the infrastructural development of the urea project.
Perdaman estimates the construction of the plant will conclude in the next 5 years.
Shares in Incitec Pivot (ASX:IPL)
are trading 1.9 per cent higher at $2.70