KCl long term price of US$368.65 per tonne CFR Brazil, which is the price reference for Product pricing in terms of K 2O equivalent content.
US Dollar-Brazilian Real exchange rate of US$1 = R$5.30. The PFS is based on the following assumptions:Ī projected mine life of 72 years for the Plant 3 Scenario, 31 years for the 23Mtpy Scenario and 26 years for the 50Mtpy Scenario. The 2017 PFS mining plan was modified, considering the three independent production scenarios of and Product compositions.
The 2017 PFS mineral resource estimate was completed by Bradley Ackroyd (MAIG), an independent “Qualified Person,” in accordance with NI 43-101. The mineral resource for the PFS remains unchanged from the 2017 PFS (effective date March 2014). Table 01: Summary of the financial-economic analysis for the Plant 3 Scenario Tables 01 through 03 show the summary of the financial-economic analysis for the three Scenarios. The Study underpinned the preparation of the PFS and it comprises information about the Product pricing and market share for each composition.įor further information on the Study, please see the press release issued on April 2022: įigures referenced in this news release can be viewed through the following link: Currently, the KCl CFR Brazil port price is approximately US$1,125 per tonne. The PFS relies on a KCl CFR Brazil port price of US$368.65 per tonne, as per the Market Study (the “ Study”) as detailed in the press release of April 21, 2022. The PFS contemplates three distinct production scenarios:Īnnual production of 10Mtpy (“ Plant 3 Scenario”), representing 13.51% of the Brazilian potash market demand projected for 2025.Īnnual production of 23Mtpy (“ 23Mtpy Scenario”), representing 31.07% of the Brazilian potash market demand projected for 2025.Īnnual production of 50Mtpy (“ 50Mtpy Scenario”), representing 54.97% of the Brazilian potash market demand projected for 2030. The Product as a source of potash, sulphur, zinc, boron, copper and manganese (“ K 2 O+S+Micronutrients”) The Product as a source of potash and sulphur (“ K 2 O+S”) The Product as a source of potash (“ K 2 O”) The PFS contemplates three Product compositions: The Committee's findings and recommendations will soon be made publicly available, with the expectation that financing Plant 3 entirely from cashflow will not impact the return of gains to shareholders via dividends, buyback or a combination of both. The Company's Special Committee of the Board of Directors is concluding work on the Paid for Growth strategy, as announced in the press releases dated January 24, 2022, and February 22, 2022, respectively. The capex for Plant 3 is expected to be covered by accumulated cashflow generated by sales up to Q2 2023, without need for equity or debt financing. Plant 3's post-tax net present value (“ NPV”) is projected at US$2.91 billion (8% discount rate) with an internal rate of return (“ IRR”) of 427.17%, assuming a potash price at less than a third of current Potassium Chloride (“ KCl”) prices and those adopted by Verde. Plant 3's capex is estimated by the PFS at US$52.77 million.
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