LSB Industries Reports Strong Third-Quarter 2026 Performance, Advances Production Reliability and Low-Carbon Ammonia Plans
LSB Industries, a chemical manufacturer focused on ammonia and ammonia-related products, reported continued operational progress during the third quarter of 2026, highlighting improved production capabilities, stronger facility reliability and ongoing initiatives to support long-term growth. The company is advancing its manufacturing operations while pursuing low-carbon ammonia production ad carbon capture projects designed to strengthen its position in agricultural, industrial and future energy markets.
Mark Behrman, Chairman and Chief Executive Officer of LSB Industries, said the company delivered another good quarter as it continued improving the capability and reliability of its production facilities. During the first nine months of 2026, all three of the company’s production facilities established new monthly production records. LSB is also on track to achieve record annual production of nitric acid and ammonium nitrate (AN) solution in 2026.
Behrman credited employees for their focus on safety, operational discipline and reliable plant performance. He also emphasized that the company’s manufacturing initiatives, implemented over the preceding three years, are beginning to deliver results as production levels improve following two major plant turnarounds completed during 2026.
With customer demand remaining strong, LSB believes its operational improvements and ongoing strategic initiatives position it to meet changing market requirements and pursue more consistent earnings and cash flow generation.
Production Improvements Strengthen Manufacturing Performance
Operational reliability remains a central priority for LSB Industries as it seeks to improve production efficiency and meet demand across its agricultural and industrial customer markets. The company’s three manufacturing facilities play an important role in supplying ammonia and related chemical products used in various industrial processes and agricultural applications.
The achievement of new monthly production records at all three facilities during the first nine months of 2026 represents a significant operational milestone. It also supports the company’s expectation of record annual production for nitric acid and AN solution.
Nitric acid is an important industrial chemical used in fertilizer manufacturing and other chemical applications. Ammonium nitrate solution is also used in agricultural and industrial markets, making reliable production important for customers that depend on consistent supplies of these materials.
LSB’s focus on manufacturing reliability includes the completion of major plant turnarounds. Such maintenance activities are necessary to inspect equipment, perform repairs and improve operating performance. Although turnarounds require planned downtime, successful execution can help facilities return to service with improved reliability and support sustained production.
Following two major turnarounds completed this year, LSB reported production levels that support its efforts to serve growing customer needs. The company believes the improvements achieved through its multiyear initiatives will help it pursue stronger operating performance in a dynamic global environment.
Behrman said the company intends to continue building on this progress, with an emphasis on safe operations, production reliability and initiatives designed to deliver higher earnings and cash flow over time.
El Dorado Carbon Capture and Sequestration Project
Alongside its manufacturing improvements, LSB Industries is advancing its low-carbon ammonia strategy through a carbon capture and sequestration (CCS) project at its El Dorado, Arkansas, facility.
In May 2026, the company reached an agreement with Lapis Carbon Solutions to assume full ownership of the El Dorado CCS project. The initiative is designed to capture carbon dioxide generated at the facility and permanently sequester it underground, reducing emissions associated with ammonia production.
The project’s completion and the start of carbon dioxide injections depend on the U.S. Environmental Protection Agency (EPA) issuing a Class VI permit. The EPA’s technical review of LSB’s resubmitted application remains ongoing.
According to the company’s disclosure, the EPA’s published Class VI Permit Tracker indicates a potential operational date in the second half of 2027. However, based on continued engagement with the EPA’s Region 6 office, LSB believes an earlier start may be possible, depending on when the agency completes its review. The timing remains subject to regulatory approval.
Class VI permits govern wells used for the underground geological sequestration of carbon dioxide. Obtaining the required authorization is therefore a key step before LSB can begin injecting captured CO₂ as part of the project.
The company completed a stratigraphic well in June 2025 to provide geological data supporting the EPA’s review of its permit application. LSB intends to use the completed well for carbon dioxide injection once the required approval is received.
Project Targets Lower Emissions and Low-Carbon Ammonia Output
LSB expects the El Dorado CCS project to capture and sequester between 400,000 and 500,000 metric tons of carbon dioxide annually once fully operational.
The company estimates that the project could reduce its Scope 1 emissions by approximately 25%. Scope 1 emissions are direct greenhouse gas emissions from sources owned or controlled by a company, including emissions associated with its manufacturing operations.
The initiative is also expected to support annual production of between 305,000 and 380,000 metric tons of low-carbon ammonia. This output could provide LSB with an opportunity to serve customers seeking ammonia produced with a lower emissions profile.
Low-carbon ammonia is attracting interest because ammonia is used extensively in fertilizer production and industrial processes, while its production can generate substantial carbon emissions. Capturing and sequestering carbon dioxide can reduce the emissions associated with conventional production, depending on the facility’s overall process and emissions profile.
For LSB, the El Dorado project combines environmental objectives with a potential new source of earnings. Its ultimate contribution will depend on regulatory approval, successful project execution, operational performance and continued qualification for applicable incentives.
Federal Tax Credits Could Support Annual Earnings
The company expects carbon dioxide sequestered through the El Dorado project to qualify for the enhanced federal tax credit under Section 45Q of the U.S. Internal Revenue Code. The credit is currently valued at $85 per metric ton of carbon dioxide for qualifying geological sequestration, subject to applicable requirements.
Based on expected annual capture volumes, LSB estimates that the project could generate approximately $25 million to $30 million in annual earnings when fully operational, net of CCS operating costs. The company expects this benefit to extend over the 12-year tax credit period, subject to continued qualification.
The potential earnings contribution would add an important financial dimension to the company’s low-carbon ammonia strategy. However, the estimated benefit depends on the project achieving its planned capture volumes and satisfying the relevant eligibility and compliance requirements.
LSB also noted that the timing of earnings recognition may differ from the timing of cash receipts. Tax credits are expected to be recognized in earnings as they are earned, while cash inflows will depend on the method selected to monetize the credits.
Consequently, the project may not generate cash receipts at the same time that the associated earnings are recorded. The distinction is important when assessing the project’s contribution to cash flow, liquidity and overall financial performance.
Conference Call to Discuss Third-Quarter Results
LSB Industries scheduled a conference call for Thursday, October 29, 2026, at 10:00 a.m. Eastern Time, or 9:00 a.m. Central Time, to discuss its third-quarter 2026 results and recent corporate developments.
Participants include Mark Behrman, Chairman and Chief Executive Officer; Cheryl Maguire, Executive Vice President and Chief Financial Officer; and Damien Renwick, Executive Vice President and Chief Commercial Officer.
Interested participants can join by dialing 877-407-6176 or 201-689-8451. Callers are asked to dial in approximately 10 minutes before the scheduled start and request the LSB conference call.
A webcast and accompanying presentation are available through the Events & Presentations section of the company’s investor website at www.lsbindustries.com. The company also indicated that the webcast would be archived for those unable to listen to the live event.
LSB Industries’ Manufacturing and Low-Carbon Strategy
Headquartered in Oklahoma City, Oklahoma, LSB Industries is focused on producing low- and no-carbon products intended to support agriculture, industry and future energy markets. Its product portfolio serves agricultural and industrial customers, with the company working to expand its role in lower-carbon production.
LSB manufactures ammonia and ammonia-related products at facilities in Cherokee, Alabama; El Dorado, Arkansas; and Pryor, Oklahoma. It also operates a facility in Baytown, Texas, for a global chemical company.
The company’s strategy combines improvements to its existing manufacturing operations with investments in potential lower-carbon production capabilities. Reliable output from its current facilities remains important to meeting customer demand, while the El Dorado CCS project could provide an additional pathway to reducing emissions and producing low-carbon ammonia.
The operational records achieved during the first nine months of 2026, together with progress following major maintenance turnarounds, indicate that LSB is continuing to focus on production performance. At the same time, the company is pursuing a project that could contribute to future earnings and support its environmental objectives.
As LSB moves forward, its ability to maintain safe and reliable operations, meet production targets, secure the necessary carbon sequestration permits and execute its low-carbon strategy will be central to its longer-term progress. The company expects its operational initiatives and continued focus on customer needs to support efforts to deliver more consistent earnings and cash flow while developing opportunities in the evolving low-carbon chemicals market.
