2014 saw the launch of two major capex projects − the Polyamide Plant II 80 thousand t/y project and the Granulation Plant II project.
The objective of the Polyamide Plant II 80 thousand t/y project is to more efficiently utilise the caprolactam output of the Grupa Azoty Group, the surplus of which is now sold on the market. The new PA 6 Plant will enable the Company to earn profit from sale of additional polyamide 6 volumes and offer new polyamide types that had not been previously manufactured at the Group’s facilities.
The project’s budget is PLN 320,000 thousand. In 2014, a procedure was held to select the licensor, followed by the execution of a contract for purchase of the licence and process design, and for delivery of key plant components (the contract’s effective date was January 19th 2015). Final completion of the project is planned for 2016.
The amount of capital expenditure incurred until the end of 2014 was PLN 2,325 thousand.
The Granulation Plant II project will allow the Parent to optimise the mix of fertilizer products and add further value to its ammonium sulfate output. The project is intended to double the output of mechanically granulated fertilizers and increase the level of the Parent’s specialisation in nitrogen- and sulfur-containing solid fertilizers.
The project’s budget is PLN 141,000 thousand. Currently, the planning permission documentation is being prepared. The contractor has been selected to prepare a comprehensive construction design, an EIAR application has been filed, and the procurement of key plant components has begun. In addition, relocation of the installations that would collide with the main building has been completed. Final completion of the project is planned for 2016. The amount of capital expenditure incurred until the end of 2014 was PLN 5,532 thousand.
Other key investments included:
- Upgrade of the interior of ammonia synthesis reactors,
- Purchase and assembly of a new circulating hydrogen compressor for the phenol hydrogenation unit at the PD catalyst,
- Consolidation of IT systems of Grupa Azoty Group companies,
- Bulk fertilizer storage facility,
- Intensification of the unit for manufacturing cyclohexanone from phenol,
- New iron-chromium catalyst plant,
- Increase of ammonia production capacities,
- Flue gas desulfurization unit,
- Flue gas denitration unit,
- 20 MW pass-out and condensing turbine generator set at the CHP Plant.
The objective of upgrading the interior of ammonia synthesis reactors was to provide new interiors in the ammonia synthesis reactors and to increase the heat and cold exchange surface areas in the exchangers. The project will reduce the cost of ammonia production by reducing consumption of electricity needed to compress synthesis gas and cooling ammonia, making better use of reaction heat to produce steam, and reducing consumption of the coolant.
The project’s budget is PLN 18,600 thousand. Expenditure incurred so far is PLN 17,761 thousand, of which PLN 7,539 thousand was spent in 2014.
It will be placed in service after a round of tests scheduled for Q1 2015.
Purchase and installation of a new circulating hydrogen compressor for the phenol hydrogenation unit at the PD catalyst − the project’s objective is to ensure continuous operation of one of the key units in the caprolactam production line.
The project’s budget is PLN 16,200 thousand. Expenditure incurred so far is PLN 14,507 thousand, of which PLN 2,957 thousand was spent in 2014. All deliverables under the project completed in 2014. Currently, the project is at the commissioning stage.
The IT consolidation project covers consolidation of IT systems operated by the Parent and Grupa Azoty ZAK S.A. It will improve the efficiency of managing the Group.
The project’s budget was PLN 9,800 thousand. Expenditure incurred totalled PLN 9,655 thousand, of which PLN 590 thousand was spent in 2014. The project was completed and settled.
Bulk fertilizer storage facility project involves construction of a 10,000-tonne bulk fertilizer storage facility with auxiliaries. The new storage facility will be a part of the fertilizer production line and will enable the company to season and to store in appropriate conditions its Saletrosan® 26 (macro granules ASN) and Saletrzak 27 Makro (macro granules CAN).
The project’s budget is PLN 43,000 thousand. Final completion of the project is planned for 2015. Expenditure incurred so far is PLN 10,620 thousand, of which PLN 10,255 thousand was spent in 2014.
Intensification of the unit for manufacturing cyclohexanone from phenol − the project’s objective is to reduce the cost of producing cyclohexanone from phenol and increase cyclohexanone output.
The project’s budget is PLN 25,750 thousand. Expenditure incurred so far is PLN 403 thousand, all of which was spent in 2014. Completion of the project is planned for 2015.
New iron-chromium catalyst plant − the project’s objective is to scale up the Company’s catalyst operations, further improve the catalyst quality, create expansion opportunities, and increase the customer base.
The project’s budget is PLN 27,700 thousand. Expenditure incurred so far is PLN 150 thousand, all of which was spent in 2014. Final completion of the project is planned for 2016.
Increase of ammonia production capacities − the project’s objective is to increase the Group’s ammonia output by approximately 100 t/d to partly replace the more expensive ammonia from external sources. The project involves elimination of bottlenecks at the VRM unit and utilisation of idle ammonia synthesis capacities. As a result, the Group will be able to replace the more expensive third-party ammonia with its own product, thereby reducing the cost of the material.
The project’s budget is PLN 44,500 thousand. The amount of capital expenditure incurred until the end of 2014 was PLN 167 thousand. Final completion of the project is planned for 2016.
Flue gas desulfurization unit − the project’s objective is to reduce sulfur dioxide and dust emissions from a CHP Plant’s boiler, meet the emission standards laid down in the IED Directive, and ensure the continuity of power and heat production.
The project’s budget is PLN 45,400 thousand. The amount of capital expenditure incurred until the end of 2014 was PLN 373 thousand. Final completion of the project is planned for 2016.
Flue gas denitration unit − the project’s objective is to reduce NOx emissions from a CHP Plant’s boiler, meet the emission standards laid down in the IED Directive, and ensure the continuity of power and heat production.
The project’s budget is PLN 44,600 thousand. The amount of capital expenditure incurred until the end of 2014 was PLN 373 thousand. Final completion of the project is planned for 2016.
20 MW pass-out and condensing turbine generator set at the CHP Plant − the project’s objective is to optimise the loads of the existing back-pressure turbine generators. It will help optimise
the CHP Plant’s costs by increasing the loads of the Lang pass-out back-pressure turbines (efficiency improvement), increasing the generation of electricity in condensing mode, and decreasing the reduction of process steam output. The project will bring down the average cost of electricity, increase the availability and reliability of the CHP Plant’s process system and enable more efficient power generation compared with the system now in place.
The project’s budget is PLN 63,000 thousand. The amount of capital expenditure incurred until the end of 2014 was PLN 8,095 thousand. Final completion of the project is planned for 2016.