Kore Potash PLC (LON:KP2) has revealed the results of a definitive feasibility study for the Kola potash project in the Republic of Congo.
The project’s post-tax NPV at a 10% discount rings in at a chunky US$1.45bn and offers a real ungeared internal rate of return of 17% on an attributable basis.
READ: Kore Potash identifies potential for up to 75% resource boost at Sintoukola
Life-of-mine average Muriate of Potash (MOP) prices has been modelled at US$360 per tonne for granular and US$350 per tonne standard.
The operating cash margin is set to average 75%, while the average annual EBITDA is likely to be around US$585mln.
Average annual free cash flow, post-tax, post commissioning, will be approximately US$500mln.
The French Consortium which undertook the DFS is contracted to deliver a proposal for an Engineering, Procurement and Construction (EPC) contract within three months of DFS completion.
“Kola is designed to deliver potash to markets in Latin America and Africa at a significantly lower cost than other potash producers over a long timeframe,” said Kore chief executive Brad Sampson.
“It stands out globally as a project that needs to be brought into operation to meet the growing global demand for MOP."