The Khemisset Potash Project

Targeting the development of a low capital cost potash mine with potential for high margins – delivering robust investor returns through the potash price cycle.

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Khemisset Project

Emmerson’s primary focus is on developing the Khemisset Potash Project located in Northern Morocco.

The project has a large JORC Resource Estimate (2012) of 311.4Mt @ 10.2% K2O and significant exploration potential with an accelerated development pathway targeting a low capex, high margin mine. A Scoping Study completed by Golder Associates in November 2018 has confirmed robust economics for Khemisset with a post-tax NPV10 of US$795 million and IRR of 29.8% to produce approximately 800,000 tonnes of K60 MOP per annum during steady state operations over the initial 20 year mine life. Importantly, Khemisset has demonstrated an incredibly low pre-production capital cost of US$406 million, less than half of its global peer average capital intensity.

Khemisset is ideally located to benefit from the expected high growth in demand for NPK fertilisers on the African Continent. Its location, close to a number of potential export ports, on the doorstep of European, Brazilian and US markets, means that the project will receive a premium netback price relative to many of its peers. The need to feed the world’s rapidly increasing population is driving demand for potash and Emmerson is well placed to take full advantage of the opportunities this presents.

Khemisset Fast Facts

De-risked

with estimated historical spend of US$20million; 136 drill holes for c. 85,000m and PFS (1974)

Location
Located in one of the fastest growing potash consuming countries in the world (88% CAGR 2015-2017)
JORC Resource
Significant JORC Resource of 311.4Mt @ 10.2% K2O and strong exploration potential
Shallow deposit

Relatively shallow deposit commencing from only 450m below surface

Basin strike

Basin strike extends over 60km by 20km

K60 Product

(saleable grade for standard MOP for agricultural use) aiming for a +20 year mine life

Low Capex
US$406 million - Bottom quartile capital intensity per tonne of product produced – less than half of global peer average capital intensity
ROBUST ECONOMICS
Post-tax NPV10 US$795M; IRR of 29.8%; Cash Margins of 50%; EBITDA Margins of ~64%; Post-tax cashflow of US$184M per annum

Location

The Khemisset Potash Project is located in Northern Morocco. It is approximately 90km from the capital city, Rabat, and the planned bulk port of Kenitra Atlantique and 150km from the port of Mohammedia. It is close to the significant regional town of Khemisset and benefits from outstanding infrastructure including a network of toll roads, and electricity distribution grid and enjoys a supportive local government.  Emmerson has identified pre-production capital cost savings of over US$1.2 billion relative to the average Canadian potash mine development, with cost savings of over 90% on key mine access and infrastructure

 

JORC Resource

JORC Resource Classification Deposit Tonnage (Mt) % K2O Thickness (m)
Inferred East Central 253.2 10.3 2.3
Inferred Southwest 58.2 9.5 2.6
Total 311.4 10.2 2.4

THE SCOPING STUDY DEMONSTRATES A FINANCIALLY ROBUST PROJECT THAT DELIVERS STRONG NPVS & CASHFLOWS THROUGH A RANGE OF POTASH PRICES

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