BÉCANCOUR, QC, Déc 16, 2014 /CNW Telbec/ - In order to reposition their urea production plant at Bécancour, La Coop fédérée and IFFCO announce, in the name of IFFCO Canada shareholders, suspension of the following steps in the project: the preparation of preliminary plans and specifications to establish project costs and the signing of an EPC contract (engineering/procurement/construction). As construction costs are now estimated to be in excess of $2B, this suspension will allow the shareholders to review the global strategy of financing, construction and execution.
Not an abandon, an essential strategic pause for a major industrial project
This cost, the equivalent of five stadiums like the one being built in Québec City, makes it one of the largest industrial projects in Québec in the last 25 years. The project now requires a new approach to ensure its realisation and viability. In no way does this announcement deem the project abandoned, but rather declares a strategic pause common in such large projects. In coming months, the focus will therefore be put on the search for new partners. "I have seen for myself that there is interest in the project in the region. We have gone through numerous steps at a fast pace to date, and now we need to refocus the project to ensure its viability in the medium- and long-term," declared Manish Gupta, CEO of IFFCO Canada and IFFCO's representative on the board.
Responsibility and transparency
This strategic recess aims at better evaluating and keeping control of the industrial worksite by consolidating its assets. At this stage of the project's development, it will ease the pressure imposed on both agricultural cooperatives by a tight schedule and the various fluctuations in current commodities markets. Both will also be in a better position to make business choices by means of more thorough analyses and projections.
Concerned with the cooperative values of responsibility and transparency, La Coop fédérée and IFFCO have a common desire to respect and protect the investments of the various partners.
A promising project that must be carried out in the right way at the right time
The promoters wish to ensure that everything is done properly, in the right order and at the right time. This is as much in the interests of the Québec and North American agricultural sectors as it is to the economy of the local region. "Our cooperative values lead us to work in a transparent and rigorous manner, in a perspective of achieving long-term results. We believe that our future fertiliser plant at Bécancour answers a need in the market and that's why we are moving forward to bring in new partners who will ensure the project's success," stated Gaétan Desroches, CEO of La Coop fédérée. "We recognise and salute the collaboration of all representatives of the government of Québec involved in this project, who have strived to contribute to its optimal development," added IFFCO Canada Director General, Claude Lafleur.
La Coop fédérée and IFFCO remain convinced of the value of the project's major assets, including the quality of the future site in the Bécancour Industrial Park, the strategic access to port and rail facilities, and the favourable context of the North American energy sector with its access to natural gas at a competitive price. Lastly, the current state of the market and other similar projects in North America allows IFFCO Canada to take this pause without interfering with the project's positioning.
About La Coop fédérée
Founded in 1922, La Coop fédérée is the most important agri-food organization in Quebec. It is owned by over 100,000 members grouped into 97 cooperatives located in several Canadian provinces and it is present throughout the agri-food chain. La Coop fédérée, as well as being a wholesaler, also provides agricultural producers with all the goods and services they require for their farming operations. The network has five brands: Elite and La Coop (animal and crop production, grain marketing), Unimat (hardware and farm machinery), Sonic (energy) and Olymel (meat processing). La Coop fédérée employs almost 10,000 people with sales totaling $5.2 billion. Including its affiliated network, La Coop fédérée employs almost 16,000 people with sales of $8.3 billion.
About the Indian Farmers Fertiliser Cooperative (IFFCO)
With some 50 million members in more than 40,000 cooperatives, the Indian Farmers Fertiliser Cooperative (IFFCO) is one of the largest fertiliser cooperatives in the world, with an annual turnover of over $5 billion. IFFCO supplies farmers with quality fertilizer and other services. The cooperative operates five fertiliser production plants in India and holds shares in plants in Oman, Jordan and Senegal, in addition to investments in Australia, Peru and Argentina. Through its foundation, IFFCO is known for its involvement in local communities in India in the areas of education, health care and the supply of drinking water
SOURCE: IFFCO Canada Entreprise Ltd
For further information: Source, Ben Marc Diendéré, Vice president, communications and public relations, La Coop fédérée; Media contact, Yvan Martin, Regional communications Officer, IFFCO Canada, [email protected], Office: 819 602 0302, Cell: 819 269 3947