LSB Industries receives $113 million insurance settlement for Arkansas plant explosion

LSB Industries Inc. will receive a settlement of $113 million from its insurance company after a May 2012 explosion damaged one of its chemical plants in Arkansas. Nobody was injured in the explosion, which happened at a concentrated nitric acid plant in El Dorado, Ark. LSB said Friday it received $60 million from the settlement, and the remaining $53 million will be received in the next 30 days. LSB already paid a $1 million deductible on the claim. The company plans to spend about $120 million to build a replacement plant at El Dorado that will make a less concentrated form of nitric acid. Chief Financial Officer Tony Shelby said most customers want the less-concentrated form of the chemical. LSB also will build a concentrator to serve the handful of its customers that need the stronger version of nitric acid. Shelby said LSB is awaiting final action from the Environmental Protection Agency on a permit for the new nitric acid plant, which should be operating by late 2015. Nitric acid blends are used for several applications, including semiconductors, herbicides, pesticides and metal treatment.