UPDATE 1-S.Africa’s Omnia to more than double acid output

* Second plant to produce 1,000 tonnes of nitric acid a day

* Current plant capacity at 700 tonnes a day

* New Plant to have co-generation capacity

(Adds details)

JOHANNESBURG, May 20 (BestGrowthStock) – South Africa’s Omnia
Holdings (OMNJ.J: ) said on Thursday it plans to more than double
its nitric acid output after raising 1 billion rand ($127.5
million) to build a second acid plant.

The total estimated cost of the new plant — in nominal
terms and excluding finance costs — is around 1.4 billion rand.

It will be funded through new equity capital, internally
generated funds and project finance during an estimated 3 year
contruction period, the company said in a statement.

The new plant is estimated to produce 1,000 tonnes of nitric
acid per day at full production, compared with the current
plant’s capacity of 700 tonnes of nitric acid per, which will
remain in production, Omnia said.

“The (second) plant will have co-generation capacity and is
expected to generate sufficient energy for its own requirements
while contributing approximately 50 percent of the current
factory’s energy needs,” said the company.

Omnia said the plant — to be constructed next to its
existing nitric acid plant is Sasolburg in South Africa’s Free
State province — is estimated to generate internal cost savings
of about 280 million rand a year.

Nitric acid is an important raw material for both fertilizer
and explosives manufacturing and its availability is key to the
growth of Omnia’s fertilizer and mining explosives divisions.

“Approximately 60 percent of the plant’s estimated maximum
production capacity is projected to be utilised for internal
production requirements upon commissioning of the plant,” said
the company.

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(Reporting by Olivia Kumwenda)

UPDATE 1-S.Africa’s Omnia to more than double acid output