Tension aroused between E-Agrium Company and the governorate of Damietta; as the latter accused the company for violating the contract terms concerning the construction of a complex for nitrogen production in Damietta.
Egypt’s Petrochemicals Holding Company (Echem) has warned against wasting about E£300 million of funds in case of closing E-Agrium’s plant. The plant’s investments are projected to reach $1.2 billion by 2010.
A senior official at Echem, however, refuted claims about a dispute with the Canadian company over the profit. “The company has fulfilled all its obligations and obtained approvals from various government agencies over the project which would spur an upsurge in ammonia production,” said the official.  
Germany’s Uhde GmbH is to carry out the design and construction works of this plant, which consists of an ammonia unit with a capacity of 100,000 tons/year and a 1.3mn tons/year urea plant. The German company is expected to finalize this phase in 2010.
Atrium’s Egyptian partners will provide natural gas as feedstock. The Canadian firm holds 60% in the Agrium-Egypt for Nitrogen Products (E-Agrium) company, while Echem holds the remaining 40%.
Mohammad Kosba, the representative of Damietta at the People’s Assembly, said he filed an inquiry to the Prime Minister and other government ministers on the environmental hazards of allowing the Canadian company to produce liquid ammonia in the Dameitta Port.
On the other side, officials from Echem insisted that the project would generate no threats to the environment, noting that their company controlled 40% of the new plant and would face legal action in case of environmental hazards.
Agrium Canada has presented an offer to the authority of Damietta Port to establish a maritime terminal, in addition to an area of maritime facilities (export, import, shipping, handling and unloading……….etc) to be dedicated to its new factory in the industrial zone in the East of the port, added officials.
Last November, E-Agrium approached banks for $750mn worth of funding for the project, which is considered as a part of Egypt’s three-phase Petrochemicals Master Plan, currently implemented by EChem.
The plan revolves around the establishment of 14 petrochemical complexes, 24 projects and 50 production units worth an investment of $10 billion over 20 years. Egypt plans to raise petrochemical production to 15millionn tons/year by 2020.

By Ashraf Said