Emmerson PLC (AIM:EML), the developer of the Khemisset Potash Project in Morocco, is reviewing its options following a setback to its Environmental and Social Impact Assessment (ESIA) approval process for the planned operation.
After receiving an unfavourable recommendation from Morocco’s Commission Régionale Unifiée de l'Investissement (CRUI) and an appeal to the Wali of the Rabat-Salé-Kénitra region, Emmerson was informed that the CRUI cannot re-examine the submission, and no further appeal options were provided.
Along with the update, the company announced boardroom changes and cash-management strategies to address the impact of permitting delays.
Chairman James Kelly and non-exec Rupert Joy have resigned, with Hayden Locke assuming Kelly's role.
To conserve resources, non-executive directors will forgo cash fees in favour of share-based payments, and CEO Graham Clarke will cut his salary by 40%, partly replaced with shares.
Further cost reductions are planned, including a suspension of most project-development activities, allowing Emmerson to focus on core regulatory and administrative functions until more clarity on the ESIA process is achieved.
Chairman Locke said: "I would like to thank both James and Rupert for their wise counsel and commitment to Emmerson during what has been a very challenging period for the company.
"Both are disappointed with the outcome and are reticent to leave at this important juncture, but they also recognise a restructuring is necessary to preserve optionality for the company, and any remaining potential for value for our stakeholders."