Calgary, Alberta – Agrium Inc. (TSX and NYSE: AGU) announced today that the Kenai Blue Sky Coal Gasification Project is proceeding to complete a detailed feasibility review. 

The Project is to develop a world-class, low-emission coal gasification facility that would create a long-term off-take gas opportunity for Agrium’s Kenai nitrogen facility and that would generate competitively priced electricity for the regional power grid.  It would also provide excess carbon dioxide that could be used for enhanced oil recovery. 

A preliminary review of the Project has been completed and the detailed feasibility review will include further development of industry partnerships, more detailed definition of the design, and commencement of environmental permitting.  Agrium has been awarded a $2-million grant from the Denali Commission and a $5-million grant from the State of Alaska for this phase of the Project. 

“We greatly appreciate the ongoing support of the Denali Commission and the State of Alaska as we commence this next phase of the Kenai Blue Sky Project,” said Mike Wilson, Agrium President and CEO. 

An objective is to develop interest from a group of industry partners to site the coal gasification facility.  The facility could be operational by 2011 and is based on proven technology.  

About Agrium
Agrium Inc. is a leading global producer and marketer of agricultural nutrients, industrial products, and specialty fertilizers, and a major retail supplier of agricultural products and services in both North and South America.  Agrium produces and markets three primary groups of nutrients: nitrogen, phosphate and potash as well as controlled release fertilizers and micronutrients. Agrium’s strategy is to grow through incremental expansion of its existing operations and acquisitions as well as the development, commercialization and marketing of new products and international opportunities.

Certain statements in this media release constitute forward-looking statements.  Such forward-looking statements involve known and unknown risks and uncertainties as well as various assumptions and business sensitivities, including those referred to in the management discussion and analysis section of the Corporation’s most recent Annual Report to shareholders as well as those risk factors described in the Corporation’s most recent Annual Information Form, which may cause the actual results, performance or achievements of the Corporation to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements.  Other factors that could cause actual results to differ materially from those in the forward-looking statements, include, but are not limited to, the future global supply, demand and price conditions for nitrogen, regional and global prices and availability for natural gas and oil, future prices and availability of natural gas in the Cook Inlet for the Kenai facility, including additional drilling activity in the Cook Inlet, the level of interest by potential partners to finance the gasification facility and participate in the Project, capital cost estimates, the results of the feasibility review described in this media release, risks associated with technology, plans to finance and construct the proposed gasification facility (including changes in development plans, capital construction costs, and the timing of various phases of the Project), performance of other parties, changes in environmental and other laws and regulations, regulatory approvals, other development and operating risks, and general economic, business and market conditions.  Agrium disclaims any intention or obligation to update or revise any forward-looking information as a result of new information or future events.

- 30 -