Updated 17 August 2012

Incitec Pivot Limited’s new Dyno Nobel ammonium nitrate plant at Moranbah in Queensland is in the heart of Australia's largest metallurgical coal region, the Bowen Basin.  Close to some of the largest coal mines in Australia, the plant’s entire output is committed to Dyno Nobel customers under long-term contracts.

The Moranbah project is a fully integrated ammonium nitrate plant with an annual capacity of 330,000 tonnes. As a result of its strategic position, integrated processes and long-term competitively priced gas supply from local coal producers, the world-scale plant is expected to operate at the bottom of the cost curve in comparison with its international competitors.

The ammonium nitrate produced by the plant is an essential component in explosives used in the mining of metallurgical coal for export to steel producers.

James Fazzino, Managing Director & CEO of Incitec Pivot Limited, said: "This is a major project for IPL and fits our strategy of directly leveraging the urbanisation and industrialisation of Asia, in particular China.

"Construction at Moranbah is nearly complete and the plant cost will not be materially above the $935 million budget. Extreme weather, including record rainfall, flooding and a cyclone, delayed work on site and interfered with material deliveries.We have delivered the first initial of ammonium nitrate to our customers in July 2012.”

Referring to the improved company performance Moranbah is expected to deliver; Mr Fazzino said this project would achieve 18 per cent return on net assets in 2015, its third full year of operation.

“This will transform our Dyno Nobel Asia Pacific explosives business, approximately doubling its earnings by 2015."

He said a pleasing aspect of the Moranbah project had been the impressive safety record achieved by IPL’s construction partners.

"The construction team achieved more than 1.5 million man-hours without a lost-time injury, which we believe is an industry leading performance," he said.