LPO Announces Conditional Commitment to Michigan Potash to Produce Fertilizer for U.S. Farmers
Summary
The U.S. Department of Energys Loan Programs Office (LPO) announced today a conditional commitment for a loan guarantee of up to $1.26 billion ($1.12 billion in principal and $141 million in capitalized interest) to Michigan Potash Company, LLC (Michigan Potash). The loan guarantee will help finance the construction of a potash solution mine and processing plant in Osceola County, Michigan, to produce approximately 800,000 tons per year of fertilizer-grade muriate of potash and about 1 million tons per year of salt. The project is expected to create, at its peak, 1,400 full-time equivalent union construction jobs and 200 ongoing operations jobs.Potash is one of the key natural fertilizers needed for agricultural production, and the United States currently imports over 90% of its annual demand, mostly from Canada. CBPs ensure borrowers meaningfully engage with community and labor stakeholders to create good-paying jobs and improve the well-being of the local community and workers.Michigan Potash has committed to a project labor agreement with 11 trade unions and will have a majority union construction workforce. Michigan Potashs project is innovative in its electrification of thermal processes coupled with the utilization of intrinsic geothermal heat and mechanical vapor recompression to reduce processing energy demand.While this conditional commitment indicates DOEs intent to provide a loan guarantee to finance the project, DOE and the company must satisfy certain technical, legal, environmental, and financial conditions before the Department enters into definitive financing documents and funds the loan guarantee.