Queensland fertiliser plant at risk as high energy costs threaten closure

The future of Dyno Nobel’s Phosphate Hill fertiliser plant near Mount Isa is in jeopardy, with local politicians and community leaders warning of devastating regional impacts if the facility closes due to high energy costs.

Dyno Nobel CEO Mauro Neves announced Monday that the plant, which employs approximately 500 workers, has been placed under strategic review as high gas prices make fertiliser production increasingly uneconomical. The plant may close if a buyer isn’t found.

Local mayors emphasised the plant’s critical role in the regional economy. Cloncurry Mayor Greg Campbell stated, “It’s a major industry for Queensland and too important to see close. The Phosphate Hill project is totally unique [in Australia] … it’s more than just a mine, it’s the manufacturing plant as well.”

Mount Isa Mayor Peta MacRae highlighted the interconnected nature of regional industries, noting that sulfur from the nearby copper smelter becomes acid for fertiliser production, which then drives railway usage to Townsville. “We’re in a dire situation in an integrated economy, where this product underpins the whole Mount Isa economy,” she said.

Federal independent MP Bob Katter attributed the plant’s struggles to insufficient economies of scale and high electricity costs from gas power. “We’re up against Russia and US who are getting gas for $5,” Katter said. “We’re paying world market prices over $16. We just can’t compete.”

Queensland Minister for Natural Resources and Mines Dale Last stated his department had completed “a comprehensive analysis of the Phosphate Hill operations” concluding the plant “is a viable and valuable ongoing operation.”

State MP Robbie Katter countered that government assessments of viability are irrelevant, saying “The arbiter will be the marketplace, whether someone is willing to buy that asset.”

The potential closure comes as other major regional employers, including Glencore’s copper operations, also seek government assistance amid challenging economic conditions.

Picture: Ammonium phosphate fertiliser (credit Hills Farm Supplies)