A fertiliser factory in Brazil: OCI plans to help meet a local production shortage (Photo: Reuters)
Egypt's largest listed company Oracom Construction Industries (OCI) has announced a US$3 billion fertiliser plant venture in Brazil.
OCI said in a statement Tuesday that it will work with the EBX Group, a Brazilian holding company with investments in mining and energy, to develop the production complex at Açu Superport, located about 350 km north of Rio de Janeiro.
The stated aim of the project is to help Brazil supply its sizeable and growing demand for fertiliser, of which it is currently a net importer.
LLX, the logistics arm of EBX, is developing the Superport, which is located near 85 per cent of Brazil’s proven oil and gas fields, which will provide the energy resources for fertiliser production.
When complete the complex is expected to deliver 3 million tonnes per annum (MTPA), producing a diversified portfoilio of nitrogen-based fertilisers.
OCI management say the company will have a consolidating stake and will be actively involved in the project management of the plant.
Completion is expected in 2016, with a consortium of Brazilian banks providing 70 per cent of the funding and the rest coming from equity.
A note from investment bank Beltone Financial said OCI would "comfortably be able to raise circa $2-2.5 billion in debt to finance this project, and possibly other expansions".
Investors on Egypt's stock exchange reacted positively to the news, with OCI stocks rising 2.7 per cent in morning trade, pulling the main index over 1 per cent into the green.