Emmerson PLC - Project Update
("Emmerson" or "the Company")
The highlights of the update are:
· Multiple workstreams in progress to further de-risk the project and provide confidence in the ongoing project finance and due diligence processes
· Permitting process on track, with main permits targeted to be in place in H1 2021
· Investigation of options for staged development to reduce upfront capital costs and provide financing flexibility
· Engagement with potential strategic partners, debt providers and anchor investors proceeding well
● Company vision: In setting out to define, design, permit and build the
● Stakeholder Engagement: The Company values are summarised by the phrase "doing the right things and doing them in the right way" so Emmerson is committed to bringing positive impact to local stakeholders, particularly the direct effects of the Project and the mitigation of negative outcomes. The underlying belief is to consider wider benefits to the society and recognise that effective inclusion of the community, partners in the value-chain, and the broader range of stakeholders ultimately leverages sustainable benefits for the Project and the related entities. This is done through new jobs, development of infrastructure, and the mining project being a catalyst for overall development in the region. The benefits that the project will bring were recently confirmed in the Socio-economic Study.
● Team: The team that has been working on the project have achieved exceptional progress but as the project moves towards construction new and additional skills will be required to ensure the speed of progress is maintained. The process of building the team has commenced and will continue over the coming months to ensure all the appropriate roles are covered, but as has been the case it is intended to keep the team lean with the roles filled by committed and talented people.
● Risk Analysis: A detailed risk analysis has been completed to identify the areas that need further work to mitigate the risks and prepare the project for funding due diligence. This work is now being completed and guides the priorities for expenditure - using existing funds to maximise impact and to be fully prepared for a high level of due diligence from funding partners.
● Work underway: Workstreams that have commenced using the existing funds include geological work that will prepare for and finalise the scope of general site investigation and de-risking of the declines, a further seismic survey and additional drilling to further prove out the early mining blocks. Ventilation modelling, cuttability testing and a technical review of the mine plan are being undertaken and further process work is also underway. Where necessary, independent experts have been engaged.
● Adding flexibility: Work is currently being done to confirm the opportunities for phased development of the project which will present an advantage in financing talks. The options being assessed have the potential to materially reduce the upfront capital cost with the flexibility around potentially phased development meaning financing can be considered at different levels. Furthermore, because the valuable product off-take has not yet been allocated, in a potash market dominated by a handful of majors, this independence of supply is a major attraction to various potential partners.
· SOP: The Company is engaging with external consultants to further investigate the potential for producing SOP (Potassium Sulphate). Work is ongoing towards delivering a Preliminary Feasibility Study ('PFS') to outline the economics of this alternative and confirm the potential for significant value to be added to the project. The Scoping Study on the SOP project indicated a post tax NPV of
· Salt: The strategy is still in place for marketing the de-icing salt, which is a by-product of mining the potash. The target market for this salt is the
· Resource: A mining consultant has been engaged to investigate an expansion of the mineable potash resource. The aim of this is to secure a much longer mine plan, rather than an increase in the production rate, which would be helpful for all stakeholders in the medium and long term.
· Environmental: The permitting process remains on track for completion the of ESIA in the coming weeks with submission of the application in Q4 2020 and successful granting of the permit in H1 2021. Emmerson is focused on doing the right thing in the right way. The decision was made to produce an environmental survey that is much more robust than the minimum standard required, at a level set out by the IFC Performance Standards and Equator Principles. It may take some time, but Emmerson is confident that the outcome will be very satisfactory to all stakeholders.
· Mining: The Company is currently investigating the opportunity to speed up the process of securing the mining permit to ensure that this is successfully granted in H1 along with the environmental permit.
· Authorities: The Moroccan mining ministry and other relevant authorities are proving to be helpful in dealing with the permitting process, providing confidence that Emmerson will successfully achieve the target of having both the environmental and mining permits in place during H1 2021.
● Funding: Engagement with potential strategic partners, debt providers and anchor investors has been proceeding well. As mentioned above, there are multiple opportunities being investigated and due diligence processes are now underway.
● Advisors: Additional advisors assisting with this process include
For further information, please visit www.emmersonplc.com, follow us on Twitter (@emmerson_plc), or contact:
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+44 (0) 207 236 1177
+44 (0)20 7408 4090
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+44 (0) 207 628 3396
+44 (0)20 7236 1177
Notes to Editors
Emmerson's primary focus is on developing the Project located in
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