Farmland plant draws no bidders

An auction Thursday produced no bidders for Farmland Industries’ defunct Lawrence nitrogen fertilizer plant.

A Kansas City, Mo., bankruptcy judge accepted $295 million worth of bids for nearly all of the bankrupt company’s nitrogen fertilizer assets. But the two successful bidders, Wichita-based Koch Nitrogen Co. and Vanguard Biosynfuels LLC, were not interested in the 467-acre Lawrence plant, which has been shut down since May 2001.

The failure of anyone in the private sector to make a bid has government officials considering purchasing the plant, Douglas County Commissioner Charles Jones said.

Jones confirmed that city and county officials had signed a confidentiality agreement with Farmland giving government officials access to Farmland files related to the property. Jones expects to begin looking at the documents early next week.

“I’ll spend some time with their files,” said Jones, the former director of environment for the Kansas Department of Health and Environment. “That will allow us to come up with a number that we have some confidence in to determine what it would cost to clean up the property.”

The plant, which began operation in 1954, has a history of contamination through a series of spills and other leakage of nitrogen and chemicals into the ground.

Jones said he expected to report back to city and county commissioners on his findings in the next two to three weeks. If a purchase still seems feasible at that point, he said government officials would have to start serious discussions about possible uses for the property.

Early discussions have revolved around using portions of the property for industrial uses and portions for open space, he said.

“Nothing is off the table at this point in terms of potential uses,” Jones said.

Farmland spokeswoman Sherlyn Manson said she did not know if other parties besides the city and county had expressed an interest in the property. She said once the company received an offer it found acceptable for the property, it would present it to the bankruptcy court.

At that point, the bankruptcy court would either reject or accept the offer and set an auction date, which would give any other interested party one last chance to purchase the property.

“We’ll continue to pursue the sale of that property, but we don’t know when that may happen,” Manson said.

Jones declined to speculate on how much the city and county might be willing to pay for the site, which is along Kansas Highway 10 east of Lawrence. But Jones said between the cost of the land and cleanup efforts, the project would be significant.

“I think it is reasonable to say that it would be a multimillion-dollar project,” Jones said.

Thursday’s auction did include one other Farmland fertilizer plant that was inactive. Vanguard Biosynfuels agreed to pay $2 million for an inactive fertilizer plant in Pollock, La.

The other plants in Thursday’s auction were in Dodge City; Fort Dodge, Iowa; Enid, Okla.; and Beatrice, Neb., which were all purchased by Koch. Koch also purchased Farmland’s 50 percent ownership stake in a fertilizer plant in the Republic of Trinidad and Tobago.