Canpotex Shelves Plans for New Export Potash Terminal

TORONTO—Canpotex Ltd. shelved plans to build a new export potash terminal at the Port of Prince Rupert in British Columbia, after the potash trader determined there isn't enough demand to move forward.

"This decision was made after careful deliberation of Canpotex's current and anticipated terminal capacity needs, and the options we have to meet those needs," said Ken Seitz, Canpotex's president and CEO.

Canpotex is jointly owned by North America's three biggest potash miners—Potash Corp of Saskatchewan, Mosaic Co. and Agrium Inc.— and sells and distributes their potash, a key fertilizer ingredient, abroad.

Depressed prices for the crop nutrient amid a glut of supply in recent years have hurt producers.

In 2014, Canpotex signed a lease agreement with the Prince Rupert Port Authority to spend 775 million Canadian dollars ($601 million) to build a new potash terminal on Ridley Island. The terminal's original plans included a potash storage building with conveyor and dust-collection systems and a marine wharf capable of handling vessels with a dead weight capacity of 180,000 metric tons.

The new terminal was aimed at boosting Canpotex's export capacity while serving Chinese buyers more quickly than other facilities along the West Coast.

Despite Canpotex's decision to end its agreement with Prince Rupert, the port has several other expansion initiatives under way.

DP World, the Dubai-based ports operator, announced plans to study a further expansion at Prince Rupert's Fairview container terminal to increase its annual handling capacity to 2 million 20-foot containers, or TEUs, from about 1.35 million.

Calgary-based AltaGas Ltd. announced it January it plans to build a natural-gas export facility on Ridley Island near Prince Rupert capable of shipping up to 1.2 million tons of propane a year.

Write to David George-Cosh at [e-mail]

(END) Dow Jones Newswires

June 17, 2016 16:35 ET (20:35 GMT)

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