Oslo (2009-10-12): Qatar Fertiliser Company (Qafco) has signed a
letter of intent for the construction of the Qafco-6 expansion
project. The cost of the project is estimated at USD 610 million.


A letter of  intent between  Qafco and  a consortium  of the  Italian
company Saipem and the Korean company Hyundai has been signed for the
EPC  (Engineering,  Procurement  and  Construction)  of  the  Qafco-6
expansion project.  Yara International  ASA owns  25% of  Qafco,  the
remaining 75% is owned by Industries Qatar.

The Qafco-6 project includes the construction of a urea plant with  a
total daily production capacity of 3,850 tons. The construction  work
is scheduled  to take  approximately 35  months with  the  completion
around the end of third quarter 2012.

The consortium of  Saipem and Hyundai  is currently constructing  the
Qafco-5 project  comprising two  ammonia plants  with a  total  daily
production capacity of  4,600 tons,  and a  urea plant  with a  total
daily production capacity of 3,850  tons with completion expected  by
end  of  first  quarter  2011.  By  choosing  the  same  construction
consortium  and  design  for  Qafco-6  as  for  Qafco-5,  major  cost
synergies are captured from  the consortium already having  resources
mobilized at site and reuse of experience.

Upon  completion  of  the  Qafco-6  project,  Qafco's  total   annual
production capacity  will  increase to  around  3.8 million  tons  of
ammonia and 5.6 million tons of urea.  Qafco strengthens its position
as the world's largest single site producer of ammonia and urea.

"Qafco is  a  long  standing  and  successful  partnership,  and  the
expansion  will  further  strengthen  Yara's  production  base   with
competitive gas sourcing.  The investment cost  for Qafco-6  benefits
from cost synergies with the  ongoing Qafco-5 project. Qafco's  scale
and competitive gas  sourcing combined with  Yara's global  marketing
network forms  a strong  foundation for  profitable expansion,"  says
President and CEO of Yara International, Jørgen Ole Haslestad.

The project will be partially financed with bank loans by Qafco, with
the balance coming from Qafco's existing reserves and cash flows from
its operations.



Contact


Torgeir Kvidal, Investor Relations
Telephone  (+47) 24 15 72 95
Cellular (+47) 91 339 832
E-mail torgeir.kvidal@yara.com

Asle Skredderberget, Media Relations
Cellular (+47) 41 443 610
E-mail asle.skredderberget@yara.com

Yara International ASA is the world's leading chemical company that
converts energy, natural minerals and nitrogen from the air into
essential products for farmers and industrial customers. As the
number one global supplier of mineral fertilizers, we help provide
food for a growing world population. Our industrial product portfolio
includes environmental protection agents that prevent air pollution.
Yara's global workforce of 8000 employees represents the great
diversity and knowledge that enables Yara to remain a leading
performer in the industry.
www.yara.com


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