REG - Emmerson PLC - Operational Update: Khemisset Potash Project

EmmersonAnnouncement

02/12/2021 07:00

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RNS Number : 2891U  Emmerson PLC  02 December 2021

 

 

 

Emmerson Plc / Ticker: EML / Index: LSE / Sector: Mining

2 December 2021

Emmerson Plc ("Emmerson" or the "Company")

Operational Update: Khemisset Potash Project

 

Emmerson, the Moroccan focused potash development company, is pleased to
provide an update on progress at its world class Khemisset potash project
("Khemisset" or the "Project") in Morocco as it moves into the
pre-construction phase of development.

Overview

·    Awarded the first Basic Engineering contract (the "Contract") to Barr
Engineering for the Mineral Processing Facility

·    The Contract, signed on time and within budget, prioritised to
address the Project's critical path focused on achieving first production
early 2024

·    Expects to select the further contractor(s) for the balance of Basic
Engineering before the end of 2021, signing contract(s) before the end of
January 2022

Graham Clarke, CEO, commented:

"The financing deal we secured with GSM and GQC included an upfront cash
injection so that we could advance the next stage of the Project's
development, the basic engineering. This is part of the upfront capex, rather
than an additional cost, and moves us firmly into the pre-construction phase.
Having already signed The Contract with Barr Engineering for the Mineral
Processing Facility, we have also received bids for the balance of the Basic
Engineering aspects of the Project, comprising highways connection and site
access; portal and declines; mine site infrastructure; tailings storage
facility; electrical power; and water. We expect to be able sign contracts for
these before the end of January 2022 so that this work can be dual tracked
with the due diligence phase of the lending banks syndicate."

Details

Emmerson remains focused on developing Khemisset located in Northern Morocco
towards commencing production in 2024 and taking advantage of the robust
potash market dynamics.  Accordingly, and following the transformational
$46.75m equity financing deal with the Singaporean fund Golden Sustainable
Minerals ("GSM") and Gold Quay Capital ("GQC") announced on 10th November,
Emmerson has rapidly advanced the Basic Engineering contract stage having
awarded the first Basic Engineering contract to Barr Engineering for the
Mineral Processing Facility.

The execution of this contract, which was signed on time and within budget,
was prioritised to address the project critical path. The basic engineering
phase is part of the total pre-production capital; this contract enables the
original timeline to be maintained resulting in achieving the target first
production of early 2024.

Furthermore, the Company is in discussions with various contractors regarding
all other aspects of the Basic Engineering and expects to select the preferred
contractor(s) before the year end, and sign contracts before the end of
January 2022.

Barr Engineering (www.barr.com) is a multi-award-winning engineering and
consulting firm headquartered in Minneapolis, USA.  With a global client
base, its engineers, scientists, and technical specialists work together to
help clients develop, manage, process, and restore natural resources.

**ENDS**

For further information, please visit www.emmersonplc.com
(http://www.emmersonplc.com/) , follow us on Twitter (@emmerson_plc), or
contact:

 Emmerson Plc                                        +44 (0) 20 7236 1177

 Graham Clarke

 Shore Capital (Nominated Adviser and Joint Broker)  +44 (0)20 7408 4090

 Toby Gibbs / John More (Corporate Advisory)

 Shard Capital (Joint Broker)                        +44 (0)20 7186 9927

 Damon Heath / Isabella Pierre

 St Brides Partners (Financial PR/IR)                +44 (0)20 7236 1177

 Susie Geliher / Isabel de Salis

 

Notes to Editors

Emmerson's primary focus is on developing the Khemisset project ("Khemisset"
or the "Project") located in Northern Morocco.  The Project has a large JORC
Resource Estimate (2012) of 537Mt @ 9.24% K2O and significant exploration
potential with an accelerated development pathway targeting a low capex, high
margin mine. Khemisset is perfectly located to capitalise on the expected
growth of African fertiliser consumption whilst also being located on the
doorstep of European markets. This unique positioning means the Project will
receive a premium netback price compared to existing potash producers. The
need to feed the world's rapidly increasing population is driving demand for
potash and Emmerson is well placed to benefit from the opportunities this
presents. The Feasibility Study released in June 2020 indicated Khemisset has
the potential to be among the lowest capital cost development stage potash
projects in the world and also, as a result of its location, one of the
highest margin projects. This delivered outstanding economics including a
post-tax NPV10 of approximately US$1.4 billion using industry expert, Argus',
price forecasts.

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