Verdant Minerals Ltd (ASX:VRM) has signed a non-binding memorandum of understanding (MoU) with one of Australia’s leading fertiliser companies, Ameropa Australia.
The MoU is regarding future offtake of up to 100,000 tonnes per annum of phosphate rock concentrate or other phosphate products from the Ammaroo Phosphate Project, Northern Territory.
Ameropa currently imports over 100,000 tonnes of phosphate rock into Hobart, Tasmania for conversion to single super phosphate.
Recent positive feasibility study results for Ammaroo
Last week Verdant received positive feasibility study results from its 100%-owned Ammaroo Phosphate Project in the Northern Territory.
The study was based on a staged development with an initial 20-year open pit mine life.
Base case estimates suggest a project net present value (NPV) of $344 million based on life-of-mine net cash flows of $1.97 billion.
READ: Verdant Minerals feasibility study values phosphate project at $344 million
Verdant’s managing director Chris Tziolis said: “The establishment of an offtake MoU for supply to one of Australia’s leading fertiliser manufacturers and marketers, is another important step in the process of establishing firm markets for Ammaroo phosphate rock.
“Now that the feasibility study is complete and the process to obtain a licence to operate in its final phases, product analysis and discussions also continue with a number of other buyers of phosphate rock in the Asia Pacific region with a view of working towards other off-take MoUs and binding agreements.”
MoU is to govern flow of information, engagement and negotiations
The purpose of the MoU is to formalise ongoing information flow and engagement regarding the progression of the Ammaroo Phosphate Project.
Also, to conduct negotiations in good faith regarding the potential for Verdant to supply phosphate products to Ameropa Australia’s Hobart production facilities.
Ameropa Australia is a 100% owned subsidiary of Ameropa AG, a Swiss-based privately owned agribusiness producing and marketing fertilisers and grains globally.