WASHINGTON (dpa-AFX) - Air Products and Chemicals, Inc. (APD), an industrial gases company, Tuesday announced that it is not proceeding with the Louisiana Clean Energy Complex or LCEC project and consequently, expects a pre-tax charge in its fiscal third quarter.
The expected financial returns of the LCEC project did not meet the stringent return criteria and the company surmises pre-tax charges not to exceed $2.9 billion in its third quarter, will be primarily used to write down assets and terminate contractual commitments.
'Air Products remains committed to growing profitably in Louisiana, where it operates 18 industrial gas facilities across the state and the world's largest hydrogen pipeline network, reliably serving numerous refinery customers along the U.S. Gulf Coast.', the company said in a statement.
Further, Air Products will discontinue a zero-carbon liquid hydrogen facility in Casa Grande, Arizona and other smaller scale projects supporting clean energy distribution and these exits are driven by challenging commercial conditions, project-specific economic factors, and slower-than-expected development in certain markets, largely hydrogen for mobility.
Additionally, the company also announced that it is finalizing a marketing and distribution agreement with Yara International ASA (YAR.OL) for renewable ammonia from the NEOM Green Hydrogen Project in Saudi Arabia.
The agreement is independent of the decision to discontinue the LCEC project and will enable ammonia from the world's first large-scale renewable ammonia plant to be sold and delivered worldwide by Yara's global supply chain, the company added.
In pre-market activity, APD shares were trading at $289.60, up 6.65% on the New York Stock Exchange.
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