Arab Potash Company (APC)is planning a $150 million expansion of its Dead Sea facilities which will see a 25 per cent increase in the company’s production capacity by 2008.

The plan, which includes the construction of new salt ponds, increased warehousing and transportation capacity and the addition of a third production line, will increase APC’s capacity to about 2.4 million tonnes a year (t/y) from 1.9 million t/y.

A preferred scheme for the expansion has been selected out of six options put forward by Beirut-based Dar al-Handasah (Shair & Partners), which is carrying out a series of feasibility studies. The selected scheme will be presented in the coming months to the APC board for approval. Once it has been approved detailed design work can begin. Tenders for construction contracts are anticipated in late 2005.

APC is also close to selecting a contractor to carry out an urgent rehabilitation of the 13-kilometre-long dyke 18, which was discovered to be leaking shortly after it was built as part of an expansion in the mid-1990s. The rehabilitation has been given high priority after the collapse in March 2000 of the adjacent dyke 19, which was also part of the expansion and was designed to the same specifications. The 75 million-cubic-metre-capacity dam collapsed the first time it was filled with seawater, when the quantity of brine reached 56 million cubic metres. APC has been in dispute with UK consultant Jacobs Gibband Turkish contractor ATAover the cause of the collapse.

In its annual results, published in May, APC announced a JD 27.2 million ($38 million) provision for the design and reconstruction of the failed dyke. A provision of JD 4 million ($5.6 million) has been allowed for the rehabilitation of dyke 18.

APC was formed in 1956 and has a concession to exploit, manufacture and market potash from the Dead Sea until 2056. The company is the sixth largest potash producer in the world. In October 2003, state-owned Jordan Investment Company (JIC)sold 26 per cent of its stake in APC to Canada’s Potash Corporation of Saskatchewan (PCS)in a deal understood to be worth about $172 million. The sale was part of Amman’s privatisation programme, although JIC retains a 26 per cent stake. Arab Mining Companyowns 21 per cent of APC, while Iraqi, Kuwaiti and Libyan investors own the bulk of the remaining 27 per cent of the company (MEED 28:5:04; 17:10:03).