SIOUX CITY, Iowa, July 22 /PRNewswire/ -- Terra Nitrogen Company,
L.P. (TNCLP) (NYSE: TNH) today reported net income of $54.7 million on
revenues of $106.2 million for the quarter ended June 30, compared
with net income of $51.9 million on revenues of $104.3 million for the
comparable 1995 quarter.  For the six months ended June 30, net
income was $107.7 million on revenues of $195.5 million, compared with
net income of $93.6 million on revenues of $194.0 million for the same
period in 1995.  Earnings per limited partnership unit were $1.74
and $1.81 for the quarters ended June 30, 1996 and 1995, respectively,
and $3.72 and $3.69 for the six months ended June 30, 1996 and 1995,
respectively.  The amount of net income allocable to the limited
partners' interest is based on the partnership's net income and the
proportionate share of cash distributed to the limited partners and
the general partner.
    The record earnings during the second quarter of 1996 were due
primarily to higher sales volumes for all products, partially offset by
lower sales prices.  Sales volumes for ammonia, nitrogen solutions and
urea increased 11%, 14% and 9%, respectively, from the prior year
quarter, while sales prices for ammonia, nitrogen solutions and urea
declined 15%, 5% and 13%, respectively.  The higher sales volumes in the
1996 period were principally due to a 10-to-12% increase in the number
of corn acres planted during the 1996 season, while wet weather in some
parts of the country reduced fertilizer demand and sales prices.
Natural gas costs were lower during the second quarter of 1996
compared with the second quarter of 1995, reflecting the favorable
impact of the partnership's natural gas procurement policies.
    TNCLP also announced today a cash distribution for the quarter ended
June 30, 1996 of $2.42 per senior preference unit, payable to
unitholders of record as of August 7, 1996.  The same distribution
on the common units was also announced.  Distributions to all
unitholders will be made August 29, 1996.
    This is the eleventh consecutive quarter in which distributions on
all classes of units were made in excess of the $.605 per-unit minimum
required amount.  TNCLP has paid at least the minimum distribution
on all classes of units since the partnership completed its initial
public offering in December 1991.  Distributions are dependent on TNCLP
earnings which are traditionally highest in the quarter ending June 30,
due to the seasonal demand for fertilizer.  Earnings can also be
affected by market prices for nitrogen products, the cost of natural
gas, industry production levels, business cycles and weather.
    TNCLP is one of the largest U.S. manufacturers and marketers of
nitrogen fertilizer products.
    Note: Terra Nitrogen news releases are available at no charge
through PR Newswire's "Company News On-Call" fax service.  To obtain a
Terra Nitrogen news release, call 800-758-5804, code 106067.

    CHART:

                      Terra Nitrogen Company, L.P.
                   Consolidated Statements of Income
                (in thousands, except per-unit amounts)

                                  Three Months Ended
                                       June 30,
                                     1996      1995
    Revenues                     $106,198   $104,291
    Other income                       40        111

    Total net revenues            106,238    104,402

    Cost of goods sold             49,681     48,595

    Gross profit                   56,557     55,807

    Operating expenses             (3,322)    (4,801)

    Operating income               53,235     51,006

    Interest expense                 (120)      (523)
    Interest income                 1,567      1,367

    Net Income                    $54,682    $51,850

    Earnings per limited
     partnership unit:              $1.74      $1.81

    The amount of net income allocable to the limited partners' interest
is based on the Partnership's net income and the proportionate share of
cash distributed to the limited partners and the general partner.
    Prior year amounts have been reclassified to conform to current year
presentation.

    Nitrogen Volumes & Prices     1996                    1995
                           Sales       Average      Sales      Average
                          Volumes    Unit Price    Volumes   Unit Price
                        (000 tons)     (ton)      (000 tons)    (ton)
    Ammonia                136         $192          122        $225
    UAN                    595          103          522         108
    Urea                   112          169          103         195

                        Terra Nitrogen Company, L.P.
                     Consolidated Statements of Income
                  (in thousands, except per-unit amounts)

                                    Six Months Ended
                                         June 30,
                                      1996      1995

    Revenues                      $195,502  $194,026
    Other income                       184       222

    Total net revenues             195,686   194,248

    Cost of goods sold              84,923    91,918

    Gross profit                   110,763   102,330

    Operating expenses              (6,357)   (9,856)

    Operating income               104,406    92,474

    Interest expense                  (246)   (1,444)
    Interest income                  3,520     2,521

    Net Income                    $107,680   $93,551
    Earnings per limited
     partnership unit:               $3.72     $3.69

    The amount of net income allocable to the limited partners' interest
is based on the Partnership's net income and the proportionate share of
cash distributed to the limited partners and the general partner.
    Prior year amounts have been reclassified to conform to current year
presentation.

    Nitrogen Volumes & Prices     1996                      1995
                           Sales       Average       Sales      Average
                          Volumes    Unit Price     Volumes   Unit Price
                         (000 tons)     (ton)       (000 tons)    (ton)
    Ammonia                 207         $193           204        $227
    UAN                   1,146          100         1,062          97
    Urea                    219          188           227         197

                        Terra Nitrogen Company, L.P.
                        Consolidated Balance Sheets
                               (in thousands)

                                        June 30,
                                      1996      1995
    Assets
    Cash and cash equivalents      $80,096    $65,965
    Accounts receivable             26,421   30,690
    Inventory                       25,044     30,302
    Prepaid expenses                 4,532      5,979

    Total current assets           136,093    132,936

    Property, plant and
     equipment, net                172,967    174,789
    Distribution reserve fund       18,480     18,480
    Other assets                    11,764      5,100

    Total assets                  $339,304 $331,305

    Liabilities and partners' capital
    Accounts payable and
     accrued liabilities           $36,950    $31,056
    Current portion of long-term debt and
        capital lease obligations    1,407      1,509

    Total current liabilities       38,357     32,565

    Long-term debt and capital
     lease obligations               3,747      5,153
    Other long-term liabilities      1,059      1,061

    Partners' capital              296,141    292,526

    Total liabilities and
     partners' capital            $339,304  $331,305