Bolstered by an increase in ethanol production, Utah phosphate miner sees bright future

An "excellent" market, bolstered by an increase in ethanol production, translated into a record 2007 for Simplot Phosphate, located in Vernal.

Phosphate refers to a family of minerals that Simplot Phosphate mines at its Vernal facility, which includes a grinding mill and flotation mill, in addition to the mine.

Phosphate begins as low-grade rock, said Mark Krall, general manager. The waste stream is removed and the product is upgraded through crushing, grinding and flotation circuits, Krall said. Once the processing is complete, the material is carried as a slurry through a 94-mile pipeline to Rock Springs, Wyo., where it is converted into fertilizer.

"From there it is consumed by the agricultural industry," Krall said.

There are some organic products that compete with phosphate, Krall said, but they are unregulated and could be unsafe.

With phosphate, "You know exactly what you're getting in terms of the chemical properties," Krall said. "There are lots of things you could probably introduce into the food supply with the organics if there was no quality control."

Increased production of ethanol, a corn-based product that can be used as an alternative fuel, has increased the need for phosphate, Krall said, and led to last year being one of the best in Simplot Phosphate's history.

"Our fertilizer is used in application on corn crops," Krall said.

At the present rate, Simplot Phosphate's Vernal mine will produce for 70 to 80 years, Krall said.

"And of course, that's all dependent on how the market is," he said.

The company currently has 140 employees in Utah, with an additional 200 working at the Rock Springs facility. Simplot Phosphate spends $40 million a year on local goods and services, pays $1.7 million in taxes annually and injects $30 million a year into the economy through employee salaries.

Simplot Phosphate has also received several recognitions for environmental efforts. The company received a 2007 Earth Day Award from the Department of Oil, Gas and Mining for 500 acres of his-toric mine land the company reclaimed, fertilized, seeded and reshaped. In addition, Simplot Phosphate received a 2007 energy conservation award from the Utah Association of Energy Users.

There are no current plans to expand the company's Utah operations, Krall said, but there is plenty to keep Simplot busy.

"We're on pace for another great year," he said.

Copyright Enterprise Business Newspaper Inc. Feb 11, 2008
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