Business
2019 CEO Review
2019 CEO Review.
About this update from Emmerson Plc
[{"type":"text","content":"\n \nRNS Number : 1821Y Emmerson PLC 30 December 2019 \n\nEmmerson Plc / Ticker: EML / Index: LSE / Sector: Mining\n30 December 2019\nEmmerson Newsletter - 2019 CEO Review\n \n2019 was a year of significant progress by the Emmerson Plc (\"Emmerson\" or \"the Company\"), substantially de-risking the Khemisset Potash Project (\"Khemisset\" or \"the Project\"), increasing its inherent value and moving the Company closer to its goal of becoming a potash producer. \n \nThe Scoping Study for Khemisset in November of 2018 showed its potentially world class attributes including a long mine life, industry leading low capital cost to production, high margins and compelling economics, including a post-tax NPV10 of US$1.14 billion based on industry expert price forecasts and an average EBITDA over the 20 year life of mine of over US$230 million per annum. \n \nDuring the year, we delivered preliminary studies on two additional projects which are both accretive to the already exceptional economics at Khemisset - the sale of salt by product and the production of sulphate of potash (\"SOP\"). Including these projects takes the total attributable NPV10 for Emmerson to over US$1.8 billion, with life of mine average annual post tax free cash of around US$300 million per annum. This compares extremely favourably to a current market capitalisation for the Company of c.£26m.\n \nIn January and February, we commenced the environmental baseline study to ensure that there were no fatal flaws in the development of Khemisset. The results received in March were positive and confirmed there were no issues with respect to the development contemplated in the Scoping Study. \nIn March and April, we announced two important partnerships with a memorandum of understanding with Afriquia Gaz and a heads of agreement for offtake with a large fertiliser industry player. These partnerships are fundamental to the eventual financing of the Project and position Emmerson well for future financing discussions particularly in terms of debt.\n \nIn June, we announced that we had been approached by a large European commercial bank with an indicative offer for debt financing for Khemisset. The indication was based on highly conservative assumptions applied by the bank, including a delivered potash price in Brazil of US$235/tonn...