Yara International ASA and China BlueChemical LTD
opportunities in China. In connection with China BlueChemical's
the Company at a price to be set in the IPO. Yara is the exclusive
strategic investor in China BlueChemical's proposed IPO.
"Our strategic partnership agreement with China BlueChemical and the acquisition of the equity stake in China BlueChemical will give Yara a unique position to further pursue growth opportunities in the world's largest nitrogen fertilizer and chemicals market," says Thorleif Enger, President and CEO of Yara. "The partnership is a win-win for Yara and China BlueChemical that will harness each company's experience and capabilities in nitrogen applications for the development of the Chinese markets. The partnership will create new opportunities for both parties, enable joint investments in competitive nitrate and/or NPK plants, and consequently expand the production, marketing and distribution of mineral fertilizers in the fast growing, high-margin domestic cash crop segment, and establish a platform for new projects in industrial applications."
China BlueChemical (the Company), a subsidiary of China National Offshore Oil Corporation (CNOOC), adds value to the energy assets of the parent company by focusing on the production of ammonia, urea and methanol. The Company is one of the largest and most efficient producers of nitrogen fertilizers in China, with manufacturing plants that are conveniently located to serve both domestic and export markets and that benefit from close proximity to energy sources and from secure and stable feedstock supplies.
The Company operates three modern production facilities, two of which are located on the gas-rich Hainan Island and one of which is located in Inner Mongolia. The Company's Hainan Fudao plants incorporate Yara granulation technology. The plants were built between 1996 and 2003 and have a total designed annual urea production capacity of 1.8 million tonnes. China BlueChemical's domestic sales network extends across 20 provinces and municipalities under the direct supervision of the central government of China.
China is the world's largest fertilizer market and accounts for a third of global urea consumption (45 million tonnes), growing at 8 percent per annum. Over the last decade, Chinese agriculture has evolved into a leading world producer and exporter of a variety of cash crops, such as fruit and vegetables.
China BlueChemical is seeking a listing of its "H" Shares on the Hong Kong Stock Exchange by way of an initial public offering in Hong Kong and a Global Offering.