Arab Potash Company (APC) is the eighth largest potash producer worldwide by volume of production and the sole producer of potash in the Arab World. It also has one of the best track records among Jordanian corporations in the areas of work safety, good governance, sustainable community development, and environmental conservation.
Established in 1956 in the Hashemite Kingdom of Jordan as a Pan Arab venture, APC operates under a concession from the Government of Jordan that grants it exclusive rights to extract, manufacture and market minerals from the Dead Sea until 2058. In addition to its potash operations, APC also invests in several downstream and complementary industries related to Dead Sea salts and minerals, including potassium nitrate, bromine and other derivatives.
As a major national institution and economic contributor, APC employs more than 2,000 workers across its locations in Amman, Aqaba and Ghor Al Safi.
Highlights of APC History
1956 The Arab Potash Company was established on 7th July as a pan-Arab public shareholding company to extract potash from Dead Sea minerals.
1958 The Government of the Hashemite Kingdom of Jordan grants APC exclusive rights to extract manufacture and market minerals from the Dead Sea until 2058
1976 The project began with tests and experiments to determine the parameters of various technologies and ideas
1979 Construction work started on the project and was completed in 1982. A major engineering challenge was to build the dykes on the unstable sea bed. Sixteen million cubic meters of earth material were displaced in the process of building about (117) kilometers of seepage proof dykes eight meters wide at the top. More dykes were added later.
1983 APC began production at an initial total capacity of 1.2 million metric tons of product. Production capacity was later optimized to reach 1.4 million tons at the end of the eighties.
1988 APC posted its first profit and began plans to diversify production by studying Bromine and downstream products.
1994 Construction of a second plant of a 0.4 million ton capacity at a cost of US $120 million brought up total production capacity to 1.8 million tons.
1997-99 Joint Venture Agreements and construction of Bromine and derivatives Plants and Potassium Nitrate, Magnesia and Salt were concluded. APC invested about US $500 million in the downstream. It signed JV agreements with Albemarle of The United States for the Bromine Complex and Kemira of Finland for the Potassium Nitrate Complex in Aqaba.
2003 PotashCorp (Potash Corporation of Saskatchewan)bought 28% of APC shares from the Government of Jordan. Sales surpassed 2 million tons for the first time.
2004 Construction began on the second Cold crystallization unit with an investment of USD $450 million aiming to bring capacity to over 2.4 million tons. APC opened its first overseas sales office in Kula Lumpur- Malaysia.
2007 APC became 100% owner of Kemapco after buying Kemira of Finland’s shares in the Company which produces 120K of the high value nutrient (potassium Nitrate)
2008 Mining royalties rose from JD 15 per ton to JD 125 per ton, with a ceiling of 25% of net profits. This makes APC's royalties the highest of all potash producers in the world. APC consolidated sales approached $0.8 billion dollars. Profits soared to $500 million dollars. APC production surpassed the 2 million tons mark for the first time.
2009 Rent for concessionary land rose from JD 200,000 per annum to JD 1,500,000 per annum. APC began shipping in Bulk containers.
2010 The new Cold Crystallization plant was inaugurated by HM the King and APC reached an official potash production capacity of 2.4 million tons. As part of the expansion, The Aqaba Warehouse became the largest Potash Export terminal in the world with a capacity of 300,000MT.
2011 Agreement with the Jordan Valley Authority (JVA) was amended to raise APC's water tariff by JD 3.5 million per annum. APC sales and production hit records surpassing 2.2 million tons while consolidated sales registered 900 million dollars.
In 2011, APC production costs became one of the world's highest costs of production per ton in the world.
2012 Electricity tariff was raised by 150%, which raised APC's electricity bill by JD 31.5 million annually. A Collective agreement signed with the unions granting APC employees benefits that make the APC remunerations and benefits package one of the best in Jordan. A Joint Venture was set up with JPMC forming the Jordan Industrial Ports Company which will manage, revamp and expand the export facilities at Aqaba.
2013 The electricity tariff was further raised by 7.5% annually in the period 2013-2017. APC opened its second overseas Office in New Delhi- India.
2014 An agreement was signed between APC, the Ministry of water and Irrigation, and JVA whereby APC would finance completely the construction of a dam in Wadi Ibn Hammad to the value of JD 26 million. Construction work is expected to take 3-4 years, following which 4 million cubic meters of rain water would be harvested to provide local communities with drinking water and to address some of APC's water needs.
A 15-year agreement was signed on 19th February between APC and Jordan Bromine Company (JBC) with Nobel Energy of Houston Texas to import natural gas from fields in international waters in the Mediterranean. Supplies are expected to start arriving in 2016. The deal is expected to produce total energy cost savings for APC of JD 235 million, or an average of JD 11 per ton of potash produced.
Arab Fertilizers & Chemicals Industries (KEMAPCO)
Established in 1999, KEMAPCO is a limited liability company wholly-owned by APC, with a capital of USD $42 million. Primarily focused on the production of Potassium Nitrate fertilizer (of which it supplies around 12% of world's total demand), Dicalcium Phosphate, animal feed and Nitric Acid, the company mainly supplies markets in Europe and Asia. KEMAPCO operates from production facilities located in Aqaba, Jordan, and employs around 230 workers.
Numeira Mixed Salts and Mud Company
Located at the southern end of the Dead Sea,Numeira is a limited liability company founded in 1997 for the purpose of extracting, buying and packaging mixed salts and mud from the Dead Sea for the use of the Kingdom’s cosmetic industry. APC owns 100% of Numeira’s share capital, which amounts to over JOD 1.4 million. The company is the domestic cosmetic industry’s sole supplier of Dead Sea raw materials, and provides APC with bagging, handling and screening services.
Jordan Dead Sea Industries Company (JODICO)
Since its inception in 1994, JODICO has served APC as a vehicle for potential investments in the Kingdom. While the company does exist as a separate entity, it does not have a formal organizational structure or employees. Instead, it is represented by a General Manager position held by APC's own General Manager. JODICO is registered as a private limited liability company with a share capital of JOD 100,000, and is wholly owned by APC.
Jordan Bromine Company (JBC)
JBC was established in 1999 for the purpose of producing bromine and associated derivativessuch as tetra brome, sodium bromide, calcium bromide, hydrogen bromide, potassium hydroxide, and sodium hydroxide. The company’s products are marketed through Albemarle Corporation, USA, which alongside APC shares 50% ownership of JBC. The company’s capital stands at JOD 30 million, with a JOD 24.7 million premium issue distributed equally between the two shareholders.
Nippon-Jordan Fertilizer Company (NJFC)
NJFC was established in 1992 as a joint venture between APC, Jordan Phosphate Mines Company (JPMC), ZEN NOH, Mitsubishi Kasei, Asahi and Mitsubishi Corporation. The company began operationin 1999, producing NPK, DAP and phosphate ammonium fertilizerexports primarily for the Japanese market. The company’s capital of JOD 16.7 million is held by APC (20%), JPMC (70%), and Mitsubishi Corporation (10%).
Jordan Industrial Ports Company (JIPC)
JIPC was set up in 2009 following a memorandum of understanding between APC, Jordan Phosphate Mines Company (JPMC), Aqaba Development Corporation (ADC) and the Aqaba Special Economic Zone Authority (ASEZA). The company is responsible for refurbishing, developing and expandingAqaba ports’ existing jetty to ensurethe continuity of potash exports. Implementation work beganin 2013and is scheduled to be completed in 2016. JIPC has an authorized and paid capital of JOD 1 million, shared equally between APC and the JPMC.
Corporate Social Responsibility
APC shares the vision of His Majesty King Abdullah II for securing “a better life forall Jordanians”. Accordingly, we actively cooperate with government organizations, local community leaders, charities and NGOs to drive social development across Jordan, particularly in the governorates of Karak, Tafileh and Ma’an where we operate.
Our annual CSR contributions support and sustain initiatives that focus primarily on the sectors of education, health, water, and the environment, with the overall aim of alleviating poverty, raising living standards, boosting infrastructure and public services, and addressing community needs. In 2012 and 2013, we allocated over JOD 10 million each year to our CSR programs and activities directly benefited more than 2,000 organizations and 100,000 citizens.
People & Safety
One of our top priorities is the safety of our 2,000+ employees. Accordingly,we devote considerable resources and constantly update our measures and procedures to create a safe working environment.
In recognition of our positive performance and safety results, APCreceived the Award for Excellence in Occupational Safety and Health in 2012, granted by Jordan's General Social Security Corporation. In 2013, we completed 3 million manhours without lost time injuries, positioningAPC among the top companies in the region in the area of safety.
In addition to reducing LTI, we endeavor to ensure thatthe emergency health and safety needs of our employees and neighboring communities are met. Accordingly, in 2010, APC partnered withJordan’s Civil Defense Department (CDD) to construct an emergency response center. The CivilDefense Center, which was equipped by APC and manned by CDD, significantly improved emergency rescue services and response time in the areas it served.
Quality & Safety Accreditation
APC holds certificates of compliance for the following international and local standards:
Theadvanced capabilities of our employees have always been a major pillar of APC’s success. To sustain our performance quality, we heavily invest in the ongoing development of our people through a range of training programs and activities. In 2013, more than half of our staff participated in over 570 training activities covering 106 subjects, ensuring the continued relevance of our employees’ skills in today’s evolving international potash markets.
In line with our commitment to sustainable operations, and in compliance with local and international environmental laws, APC actively works to minimize the impact of production activities on the environment. To this effect, we incorporate state-of-the-art technologies at APC’s new plant and strict policies at all Company sites to reduce waste products, limit potash and carbon emissions, and streamline the consumption of energy and water. We also annually dedicate a portion of our CSR budget to finance environmental and water projects. In 2013 alone, APC provided in excess of JOD 1.2 million to support marine, nature, energy, water, and recycling societies and initiatives.
2013 APC Sales Distribution in MT
H.E. Jamal A. Al Sarayrah, Chairman of the Board of Arab Potash Company (APC), outlines his company's work in Jordan.
The Arab Potash Company is one of the first and most successful examples in attracting foreign direct investment to the Kingdom. Today APC is one of the Jordan's biggest exporters, one of the largest earners of foreign currencies, and one of the largest providers of work opportunities in the private sector, with a workforce of 2,206 employees at the end of 2013 plus 287 employees in its subsidiary and affiliate companies. Most of these employees come from local communities in Jordan's highest concentration of pockets of poverty and unemployment.
At the same time, APC pays around 60% of its annual profits to the Treasury in the form of profit dividends, corporate tax, royalties, road tax, port fees, rent of land, and scientific research fees. In 2013 this amounted to nearly JD 78 million (US $ 111 million).
It is well known that political turmoil and instability are bad for business because of their negative effects on the confidence of potential investors and trade partners. However, Jordan is fortunate in that its wise and far sighted leadership has succeeded in steering a safe course through the troubled waters of the Middle East. Jordan is and will remain, God willing, an oasis of stability and a beacon for progress in the region.
Until 2008, APC had one of the lowest cost of production per ton among potash producers. Since then production costs rose considerably as follows:
These sharp rises have now laced APC among the highest cost of production producers in the world. We are currently working on a number of projects to reduce production costs, mainly the cost of energy. Solutions include shifting from heavy fuel currently in use to natural gas which is more cost-effective and environmentally friendly, as well as expansion in the use of renewable energy, mainly solar energy for electricity.
Jordan Bromine Company (JBC) was incorporated in January 1999 as Joint venture between Arab Potash Company and Albemarle Corporation, registered as a private Free Zone Company located at Safi South of the Dead Sea in June 2000.
JBC with its diversified range of its high-quality and safe products reaching more than 30 countries Globally, managed successfully through engineering chemical solutions to deploy its products to diverse industries and sectors that include agriculture, construction, pharmaceuticals, electronics, cosmetics, food production and processing, textiles and plastics among others; we successfully contribute to global markets
JBC is committed to long-term growth and excellence through customer and supplier partnerships, creating value for all.
Our shareholder Albemarle Corporation viewsits partnership with Arab Potash Company as being strategic and further strengthens JBC's Global position as a key bromine producer.
This is an agreement negotiated and signed by private companies: APC and Jordan Bromine Company on the one hand, and U.S.-based Noble Energy on the other. The benefits of this agreement will be lower production costs and higher competitiveness for APC and JBC, which will enable us to continue as Jordan's highest private-sector earner of hard currency, in addition to our financial contributions to the national Treasury. The agreement will also protect the interests of our 2,176 employees, and sustain our CSR programs.
Ultimately, as a major Jordanian public shareholding company, APC has a responsibility to its shareholders, employees and community. This deal is essential for maintaining our market competitiveness.
The shift from heavy fuel, which is used at present, to the less expensive and more eco-friendly natural gas, which we expect to start receiving in 2016, is projected to produce total cost savings of JD 235 million, or average savings of JD 11 per ton of potash produced. This is essential to maintain our long-term operations and growth as Jordan’s largest private-sector earner of hard currency, one of the largest contributors to the Treasury, and one of the largest private-sector employers in the country, particularly as we cope with the drop in global potash prices.
The Aqaba Warehouses is sufficient at the present rate of production. Upon completion of the Aqaba Port new jetty and rehabilitation of the existing one, APC will achieve the following strategic goals:
APC's first priority is to provide its employees with a safe, healthy, and rewarding working environment. As a result the Company reviews and updates its safety procedures regularly and holds awareness sessions to spread the culture of safety among it workers. These efforts are successful as this year we have celebrated 4 million working hours without time lost injuries, which are injuries that require workers to take time off for treatment.
As far as rewards are concerned, APC's average monthly salary amounts to JD 1,635, which is above the national average. Human resource studies conducted indicate that APC workers are paid well above the national average, at a level compatible with salaries paid in Gulf countries. The incentives package provided by APC includes:
APC is a major contributor to the development of local communities through its active CSR program, which amounted to JD 10 million (US $ 14 million) in 2012 and 2013. In this program APC focuses on translating the vision of His Majesty King Abdullah II Ibn Al Hussein, that the first "priority is a better life for all Jordanians" into reality by supporting local communities and working to address their needs in ways that raise local living standards and contribute to improving services provided in different sectors, in the aim of achieving social balance and sustainable development.
To fulfill this outlook, APC supports projects in all parts of the Kingdom in in the key sectors of water and sanitation, health services, education, building public facilities, professional and labor association activities, social welfare, welfare package campaigns, sports federations and clubs, municipal services, restoration of mosques and churches, and fighting poverty
APC has carried out several studies such as Initial Environment Evaluation (IEE) to evaluate the impact of potash production and possible expansion on the surroundings. Items considered included increase of emissions, truck trips to Aqaba, expanding potash storage facilities at Aqaba, and technical studies to determine the best ways to reduce the stack emissions to comply with international standards.
In general, potash production is considered to be one of the safest activities in industry and its impact on the environment is limited. Activities involved with the production are well controlled and impacts are measured through multiple procedures and periodic measurements that comply with the requirements of the Ministry of Environment and the international environment standards (ISO 14001) that is granted to us by Lloyds Register.
Environmental issues at our plants and facilities are summarized as follows:
H.E. Jamal A. Al Sarayrah, Chairman of the Board of Arab Potash Company (APC), outlines... Jan 28, 2015
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