By Connor Hart
Air Products & Chemicals said it will not proceed with the Louisiana Clean Energy Complex project on the basis that its expected financial returns won't meet necessary levels.
Air Products, which provides essential industrial gasses and chemicals, said Tuesday it expects to record roughly $2.9 billion in pretax charges due to its decision to not move forward with the project.
The charges, set to hit in its fiscal third quarter, primarily stem from the write down of assets and termination of contracts related to the project, the Lehigh Valley, Pa., company said.
Despite not moving forward with the project, Air Products added it remains committed to growing profitability in Louisiana, where it operates 18 industrial gas facilities and a hydrogen pipeline network.
Shares rose 7.6%, to $292, in premarket trading. Through Monday's close, the stock is up 8.3% since the beginning of the year.
Air Products also on Tuesday said it will discontinue a zero-carbon liquid hydrogen facility in Casa Grande, Ariz., as well as other and smaller-scale projects supporting clean energy distribution, citing challenging commercial conditions, project-specific economic factors, and slower-than-expected development in certain markets.
The updates came as Air Products finalized its marketing and distribution agreement with Yara for renewable ammonia from the NEOM Green Hydrogen Project in Saudi Arabia.
Write to Connor Hart at connor.hart@wsj.com