Morocco-focused potash development company Emmerson has recorded progress on various work streams that are under way following the release of a feasibility study into its Khemisset potash project.
The company has now shifted its focus to moving Khemisset to “shovel ready” status including operational capability build-out, front-end engineering and design (FEED), detailed design and financing.
The permitting process is well under way, including stakeholder engagement, socioeconomic impact assessments and the environmental- and social-impact assessment (Esia).
The feasibility study, which confirmed a post-tax net present value (NPV) of $1.4-billion and robust financials including over $300-million a year in earnings before interest, taxes, depreciation and amortisation, provides the catalyst for engagement with various potential financing groups to begin detailed due diligence, notes the company.
Emmerson is examining detailed complementary growth options, including developing a scope of work for a prefeasibility study (PFS) for Emmerson’s sulphate of potash (SoP) project, which could take the combined post-tax NPV for the company’s suite of projects to more than $1.8-billion.
Moreover, it is considering the technical and market impact of upscaled production of the salt by-product in the first five years of operations at Khemisset.
It is also exploring bringing the vast remaining resources at Khemisset into the mine plan by extending the overall mine life or increasing production in the first five years of operation.
“We are pleased with the results of the feasibility study, but now our attention must turn to the next phase of development as we seek to move the project one step further towards our goal of becoming an independent potash producer.
“Despite the impacts of the coronavirus pandemic, we continue to make progress with our Esia, which is one of the key work streams required to be completed prior to our application for a mining permit at Khemisset.
"Our objective is to have it ready for final submission to the government authorities by the end of the third quarter, in line with our original schedule. While we know this will be a challenge, our team has proven itself to be adept at continuing to move key work streams forward regardless of the circumstances and I am sure this will be no exception.
"Once the Esia is signed off by the government, we will be able to apply for our mining permits,” comments Emmerson CEO Hayden Locke.
He adds that financing will continue to be a focus for Emmerson.
“The feasibility study is the catalyst for various discussions, across debt, equity and non-traditional financing products, to commence in earnest. Over the last two years, we have engaged with numerous potential funding partners and have identified several which we believe would make excellent partners for the company in the development of Khemisset,” he says.
“Building out a team with the operational capability to construct and operate a large scale mine is a challenge for any junior mining company, and I see this as one of the main execution risks to address. We will look to add additional members to our team in the coming months as we start this especially important next phase of our development,” Locke notes.