As a result, the company claims that the plant was taken out of service on 23 September 2017 in order for repair work to be carried out on the electrical controls, wiring and piping. LSB claims that no employees were injured, and that there was no damage to the reformer or to other major pieces of equipment. The company added that there was no release of ammonia.
LSB is expecting repairs to be completed and ammonia production to restart by the end of October 2017. The company is planning to meet customer commitments for pre-sales of products either by shipping from other facilities or by purchasing them from third parties. Therefore, the plant downtime will not lead to reductions of UAN or ammonia sales volumes.
EBITDA impact from the repair expenses, the excess cost of purchasing UAN as opposed to producing it, and the decreased absorption of fixed costs, is expected to be approximately US$1.5 million – US$2 million for 3Q17, and US$2.5 million – US$2.75 million for 4Q17.
LSB will provide an update on the progress of the repairs and the impacts of the downtime on financial results when it releases its 3Q17 results in late October.