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LSB provides operational update on its facilities

LSB Industries Inc, a manufacturer of chemical products for the agricultural, mining, and industrial markets has announced that the ammonia plant at its El Dorado, Arkansas chemical facility was taken out of service on 4th June 2018, after a power failure at the facility.

Since that time, LSB management has been involved in the process of assessing the extent of the necessary repairs and has determined that the power outage resulted in tube failures in the ammonia plant’s boiler. LSB management estimates that these repairs will be completed, and ammonia production will resume, by the last week of June 2018. Management estimates the total impact to EBITDA in the second quarter of 2018 resulting from unplanned repair expenses, reduced absorption of fixed costs relating to the downtime and lost sales will be approximately $10.0 million to $11.0 million.

While El Dorado’s ammonia plant is out of service, the company has elected to pull forward work previously planned for the September 2018 Turnaround, which will further shorten the planned Turnaround in the third quarter to five days, from the previously revised twelve days, resulting in additional third quarter production and reduced Turnaround expense.

Additionally, the ammonia plant at LSB’s Pryor, Oklahoma chemical facility (“Pryor Facility” or “Pryor”) was taken out of service for short periods at multiple points during the quarter to repair leaks to the waste heat boiler. Management estimates the second quarter EBITDA impact from the downtime at Pryor to be approximately $3.0 million to $4.0 million.