On Monday, Emmerson PLC (LSE:EML) revealed a metallurgical test work programme was underway at its Khemisset Potash Project in Morocco. The programme will be carried out by the Saskatoon Research Council (SRC) under the supervision of one of the world’s leading potash experts, Don Larmour. After reviewing the existing Scoping Study, Larmour was able to highlight opportunities to optimise the project’s design. As a result, the company has managed to significantly reduce the projected capital expenditure and operating costs for Khemisset. The $7.5m saving identified by Larmour is achievable by utilizing storage and loading facilities at the Port of Casablanca.
The scoping study for Khemisset confirmed that it has the potential to be among the lowest capital cost, highest margin potash projects in the world. Now Emmerson, in consultation with Larmour, is preparing a full Feasibility Study for the project.
The project has a large JORC Resource Estimate of 311.4Mt @ 10.2% K2O with significant exploration potential to extend the resource. The Scoping Study completed in November 2018 suggested a post-tax Net Present Value (NPV10) of US$795 million for the project with an Investment Rate of Return (IRR) of 29.8pc.
Khemisset is ideally located in Morocco with a strong growing local market in addition to good access to Europe, Brazil, and the vast potential of the African continent.
MiningMaven recently spoke about the project with Hayden Locke, Chief Executive Officer of Emmerson, in our 100th episode of the MiningMaven podcast.
Locke, commenting on today’s announcement, said:
"The commencement of metallurgical testing is another important de-risking step towards our goal of becoming a highly profitable potash producer. The results of the Programme will be used to confirm, adjust and optimise the process flow sheet in the upcoming Feasibility Study.
"The results of the Met Testing will also form a key part the technical due diligence any debt or financial partners will perform when assessing the financeability of the Project.
"Don and SRC have an extensive history working together and we expect that the programme will be completed to a very high standard which will be beneficial to the long-term future of the Project.
"We look forward to continuing to deliver on our many development objectives and timelines during this transformational year for the Company as we advance the world-class Khemisset Project towards production."
Author: Stuart Langelaan