Name and Location
Kouilou potash mine, Pointe-Noire, Republic of Congo.

Project Description
The project involves the construction and commissioning of a 600 000-t/y potash plant to produce agricultural-grade potash fertilisers to meet the growing demand from markets in South America, South Africa, South Asia and Europe.

Value
The most recent estimate of all-in capital and financing costs for the 600 000-t/y operation was $1,1-billion, of which 70% will likely be funded through debt.

MagIndustries has another $200-million on hand, and will then seek to raise $130-million to $180-million by selling equity. The debt negotiations are under way with a consortium of about ten development finance institutions and export credit agencies.

Duration
The facility is scheduled to start production by the end of 2011, with full production targeted by mid-2012.

Client
MagMinerals Potasses - owned 90% by MagMinerals, a subsidiary of MagIndustries, and 10% by the government of the Republic of Congo.

Key Contracts and Suppliers
BNP Paribas (financial adviser), Morgan Stanley (planned equity raising) and Eni Congo SA (gas supply).

Latest Developments
MagIndustries is continuing to advance and develop its Kouilou potash project. The company has been working with financial adviser BNP Paribas on raising the debt for more than two years, and is now reaching the tail end of the process. The company hopes to finalise the terms soon and then to reach financial close by the end of the northern hemisphere summer.

Separately, Morgan Stanley has been engaged to help with the planned equity raising, and this process is also under way.

Preconstruction work began at Kouilou in October 2008, but full construction of the production facility is only expected to begin once both the debt and equity financing are in place.

Meanwhile, in March 2009, MagMinerals signed a gas supply agreement for the potash project. Under the agreement, Eni Congo SA, a subsidiary of Eni SpA, of Italy, will supply the gas from its treatment plant located 25 km south-west of the project, and MagPotasses is working with the company to complete detailed engineering for the gas pipeline from Djeno to the project site. The agreement represented the last significant cornerstone contract required for the full development of the project.

On Budget and on Time?
Not stated.

Contact Details for Project Information
MagIndustries tel +1 416 368 7911.