Strike Energy (ASX:STX) - Managing Director & CEO, Stuart Nicholls
Managing Director & CEO, Stuart Nicholls
Source: Strike Energy
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  • Strike Energy (STX) agrees to potentially sell 1.4 million tonnes per year of granulated urea from its proposed Project Haber development to Koch Fertilizer
  • The companies have set up a non-binding term sheet to negotiate a definitive offtake deal for the fertiliser product
  • Some of the key terms up for consideration include a 10-to-15 year supply period and that products are priced according to international benchmarks
  • Strike says it believes an offtake deal would positively impact Australian farmers through the re-domestication of the country’s urea manufacturing
  • Strike Energy (STX) last traded at 30 cents per share on May 18

Strike Energy (STX) has agreed to potentially sell 1.4 million tonnes per year of granulated urea from its proposed Project Haber development to Koch Fertilizer.

The two companies have set up a non-binding term sheet to negotiate a definitive offtake agreement for the fertiliser product.

Some of the key terms being considered are a 10-to-15-year supply period, products being priced according to international benchmarks, and an undisclosed condition needing to be met before a final investment decision for Project Haber.

Stuart Nicholls, the Managing Director and CEO of Strike, said today’s early-stage deal marked a “transformational” period for the company.

“Securing Koch Fertilizer as Strike’s sole offtake would give Project Haber a high degree of creditworthiness and financial security,” Mr Nicholls said.

“Having a single long-term offtaker for 100 per cent of the urea production will provide the foundation for the financial architecture required to successfully finance this nationally-significant development.”

The company said it believed the deal would positively impact Australian farmers through the re-domestication of the country’s urea manufacturing.

Project Haber is an integrated, low carbon urea development based in the Western Australian Wheatbelt.

Koch Fertilizer has fertiliser plants in the United States, Canada, and Tobago. Its parent company, Koch Industries, is one of the largest private companies in the United States, with annual revenues as high as US$125 billion (A$179 billion).

Strike Energy (STX) last traded at 30 cents per share on May 18.

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