AUSTRALIAN Fertilizer Corporation Ltd (AFC) has secured exclusive 10-year off-take agreements covering the entire planned production capacity of its proposed Gladstone Urea Facility.

With the agreements in place, AFC is targeting first concrete within two years, assuming the project remains on schedule.

The off-take agreements have been executed with major customers operating across the agricultural and technical-grade automotive urea sectors in both domestic and international markets.

The AFC website indicates the location of the proposed Gladstone facility. Image: AFC

The customer names have not been made public and are currently commercial-in-confidence.

Collectively, the agreements cover AFC’s planned annual production capacity of 220,000 tonnes of technical-grade urea per annum for an initial term of 10 years, with options to extend for a further decade.

Based on current market pricing, the agreements represent an estimated contract value exceeding $2.4 billion over the initial operating period.

The agreements establish long-term domestic and international sales pathways for AFC ahead of project financing and development, significantly strengthening the commercial case for the project.

AFC’s proposed Gladstone facility will manufacture high-purity technical-grade urea for agricultural and automotive emissions-reduction markets, strengthening domestic supply security, reducing import dependence and supporting growing demand across Australia and export markets.

The project will also showcase a new approach to Australian manufacturing by transforming underutilised carbon resources, including mining by-products, end-of-life tyres, biomass, and municipal materials into essential fertiliser products.

This approach creates new economic value from existing carbon resources while supporting Australia’s transition towards a circular carbon economy.

AFC chief executive officer Stein C. Haugan said the project was expected to create approximately 800 jobs during construction and 50 permanent operational roles once commissioned.

“Securing long-term commitments for 100 percent of planned production significantly strengthens the commercial foundations of the Gladstone project, brings a new industry to Gladstone and demonstrates that Australia can once again manufacture world-class urea domestically, reducing reliance on imports while supporting local jobs, industry and farmers,” Mr Haugan said.

“These agreements position Gladstone within critical agricultural and vehicle emissions reduction supply chains while supporting sovereign manufacturing capability, supply chain resilience, regional employment and long-term industrial development in Queensland and Australia.”

“At its core, this project is about strengthening Australia’s food security.

“Every tonne of urea produced in Gladstone is a tonne that does not need to be imported.”

Mr Haugan has an existing connection to the global fertiliser industry with previous roles at Yara International, Incitec Pivot, Norsk Hydro, Ma’aden Phosphate and Noble Resources.

The AFC project will use GTI Energy’s U-GAS® technology to manufacture urea fertiliser, a process that has been commercially deployed at multiple overseas facilities for more than 30 years.

More than 25 feedstocks have been successfully tested globally for use in the production of urea using the technology.

Previous Gladstone proposal

Grain Central understands AFC is not a reboot of Australian Future Energy (AFE) Pty Ltd’s Gladstone Energy and Ammonia Project (GEAP) which was proposed for the Gladstone State Development Area.

However, there may be a connection between the companies, with AFE listed as a “commercial partner” on the AFC website.

AFC founder and executive director Edek Choros is also listed as the chairman of AFE, and Duke Runnels and Richard Barker are listed on both company’s boards.

Mick Spencer has been listed as the CEO on the AFE site and the chief operations officer on the AFC site.

GEAP was designed to produce 330,000t of ammonia a year, as well as six to eight petajoules of synthetic natural gas and up to 96 megawatts of electricity, largely from the use of 1.5Mt of coal annually.

The electricity was to be generated from waste gas and heat.

The project was progressing through Queensland Government approvals with an environmental impact statement released in 2019.

Media releases at the time expected construction to begin in 2020, with first ammonia production planned for 2022.

The AFE website lists construction commencing in June 2022, with commissioning scheduled for June 2024.

The website said the company had a 129ha just outside Gladstone where the facility was to be located.

Work on the GEAP appears to have stalled, with no progress beyond the EIS stage.

Grain Central: Get our free news straight to your inbox – Click here