With Works Stopped Since 2014, Petrobras Announces Binding Phase for Full Sale of UFN-III After Russian Group Acron Fails to Purchase Fertilizer Plant!

Operation of UFN-III, which had a capacity planned by Petrobras of 3,600 tons/day of urea and 2,200 tons/day of ammonia, can help Brazil reduce dependence on imported products, while the country deals with difficulties from the war between Ukraine and Russia.

Petrobras, continuing the announcement made on 05/31/2022, informs that the binding phase regarding the full sale of the Nitrogen Fertilizer Unit III (UFN-III) is underway. It is worth noting that in April of this year, the Russian group failed in the purchase of the unit.

According to the oil company, the potential buyers qualified for this phase, in accordance with the criteria published in the teaser, received a process letter with detailed instructions on the divestment process, including guidance for conducting due diligence and for submitting binding proposals.

State-Owned Company Failed to Sell Fertilizer Plant to Russian Group Acron

Petrobras announced in a relevant market notice on April 28 that the process of selling the Nitrogen Fertilizer Unit III (UFN-III), located in Três Lagoas, with the Russian group Acron, was not completed, “given that the proposed business plan by the potential buyer, in substitution for the original project, made certain government approvals necessary for the continuation of the transaction impossible.”

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According to the notice made by the oil company, “the company is completing the internal procedures to close the current sales process and preparing to launch a new teaser as soon as possible. The forecast is to launch the new process at the beginning of June. Petrobras reaffirms its commitment to the broad transparency of its divestment projects and the management of its portfolio and informs that subsequent stages of the project will be disclosed according to the company’s Divestment Systematic.”

The UFN-III, nitrogen fertilizer industrial unit located in Três Lagoas, in the state of Mato Grosso do Sul, had its construction work halted in December 2014, with about 81% of the work completed, after Petrobras terminated the contract with the consortium responsible for building the plant, which at the time had already consumed more than R$ 3 billion.

The operation of the unit, which had a capacity planned by Petrobras of 3,600 tons/day of urea and 2,200 tons/day of ammonia, could help Brazil reduce its dependence on imported products, while the country deals with difficulties from the war between Ukraine and Russia.