August 3, 2014 / 6:23 PM / in 4 years

UPDATE 1-Jordan's Arab Potash reports 54 pct drop in first-half profits

(Adds details and background)

AMMAN, Aug 3 (Reuters) - Jordan’s Arab Potash Company , one of the world’s largest producers of potash, posted a 54 percent drop in half-year net profit to 43.2 million dinars ($61 mln) due to higher energy costs and lower global prices, the firm said on Sunday.

Sales fell 16 percent to 278 million dinars for the first half of the year compared with the same period last year, the firm said in a bourse statement.

Arab Potash said a deal it signed last year to buy natural gas from 2016 from U.S.-based Noble Energy Inc’s Tamar field offshore from Israel from 2016 would substantially reduce its energy bill.

It currently relies on more expensive heavy fuel oil to operate its Dead Sea plants.

Potash Corp of Saskatchewan, the world’s largest producer of the fertilizer, owns 27.9 percent of Arab Potash. Several Arab states, including Saudi Arabia and Kuwait, have minority holdings.

The firm’s profits last year fell 34 percent to 131 million dinars after high energy costs and weaker global prices hurt its bottom line. ($1=0.709 dinars) (Reporting by Suleiman Al-Khalidi; Editing by Hugh Lawson)

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