By DEBBIE CAI
LSB Industries said a pipe ruptured at one of its units,
Cherokee Nitrogen Co., damaging the heat exchanger portion of
its ammonia plant.
Shares, which had been halted ahead of the news, fell 6.8%
to $35.55 in recent trading. The stock is up 27% so far this
LSB, which manufactures and sells air conditioning and
chemical components, said the incident didn't cause serious
injury or hurt the environment. It is trying to determine if
damages extend beyond the area of rupture.
According to news reports, an explosion was felt late
Tuesday in parts of Colbert County, Ala., where the facility is
located, and one Cherokee Nitrogen employee sustained a minor
The company said early estimates point to a three- to
five-month outage at the ammonia plant, depending on lead times
for repair parts. Until then, the Cherokee Nitrogen facility
can produce a limited amount of nitric acid and ammonium
nitrate solution from purchased ammonia.
LSB said its insurance policy provides replacement cost
coverage and has a $2.5 million deductible for property
The company last week reported third-quarter earnings rose
6.4% on higher sales at its larger chemical division. Its
Cherokee facility was down for a planned turnaround during that
period and was initially expected to be in full production
during the fourth quarter.
Dow Jones Newswires