Another day, another breakdown for Incitec Pivot

By Peter Roberts

How many breakdowns does a company have to suffer before the question is asked – what is going on in its United States manufacturing plants?

This comes to mind with the news that fertiliser and explosives manufacturer Incitec Pivot has suffered yet another breakdown at its troubled Waggaman, Louisiana ammonia plant.

This, the latest in a long line of failures at the 800,000 tonne a year plant, involves a rupture revealed on February 18 in a section of pipe resulting in a leak of hydrogen.

The company told investors today: “Extensive investigations have revealed only minor damage to surrounding equipment, and repair work is primarily focused on the damaged spool piece.”

This ‘minor damage’ we now learn will keep Waggaman out of action for six to eight weeks and repairs and lost sales will slash EBIT profit to the tune of $132 to $174 million, not factoring in possible insurance proceeds.

It is a little difficult to plot all the earlier failures at Waggaman but they cost more than $100 million in EBIT and include:

  • Outages at Waggaman due to issues with its carbon dioxide removal system in 2019
  • A subsequent failure saw Waggaman out of action until March, 2021
  • The plant failed again in April 2021 ‘as a result of a dry gas seal failure and vibrations in the turbine on the induced draft fan’.
  • The plant operated successfully at nameplate capacity for two weeks, when the plant unexpectedly tripped upon the failure of a vibration probe.
  • “Following repairs, the subsequent re-start process was stopped on 8 May due to a coupling failure on the refrigeration compressor, upon which the plant was safely shut down.”
  • In August 2021 the plant was closed, this time deliberately, to allow it to ride out a cyclone

Additionally, ammonium nitrate plants in Louisiana, Missouri and Cheyenne, Wyoming have also experienced unplanned downtime as a result of ‘rotating equipment failure and repair works’.

Incitec Pivot went on a US expansion spree to take advantage of the supposed benefits of America’s low gas prices, relatively lax environmental controls and low labour costs.

You can safely mark this down to one of those ‘good ideas at the time’.

Picture: Incitec Pivot/Waggaman

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