Emmerson Plc · LSE:EML
Emmerson — Investor Presentation (December 2022)
22 slides from Emmerson's investor presentation, December 2022
Slide 1: Developing a low capex, high margin potash project in Morocco
Developing a low capex, high margin potash project in Morocco Corporate Presentation – December 2022
Slide 2: At a Glance
AT A GLANCE 100% owner of the Khemisset potash project in Morocco Khemisset advancing towards construction • 19 year mine life • Production 735ktpa potash (MoP) amd 1m tpa salt • 25-year mining permit awarded 2020 • JORC Resource 537mt potash • NPV8 of US$1.4bn Listed in UK on AIM (EML.L) with exper
Slide 3: Khemisset Potash Project
KHEMISSET POTASH PROJECT SPAIN ep kenitra f Rabat e Mohammedia Main Cities — Roads FA Marrakesh @ Ports Railways Youssoufia © OCP NPK Blending facility @ OCP Phosphate Mines 1 {J Licence Area 100km_
Slide 4: Global Potash Production
GLOBAL POTASH PRODUCTION 2021 global MOP production was 72Mt of which 27Mt (38%) was from Russia and Belarus (under sanctions and shown in red below). Circles showing volume and location of global MOP mining. Global MOP production 2021: Source: Argusmedia.com 3
Slide 5: Potash Prices v Common Crops
POTASH PRICES v COMMON CROPS Source: Argusmedia.com and uk.investing.com 4
Slide 6: Population + Intensity of Use = Demand Increase (2Mtpa)
POPULATION + INTENSITY OF USE = DEMAND INCREASE (2Mtpa) After Tax NAV1 • Underlying population growth increases demand for crop production and therefore fertiliser demand. • An increase for fertiliser demand of 2Mtpa • Since 1993, CAGR: • Potash fertiliser 2.7%. • Crop production 2.1% • Population g
Slide 7: The Africa Challenge
THE AFRICA CHALLENGE Source: ourworldindata.org Africa will account for the majority of global population growth, but uses very little fertiliser on its cultivated land 6
Slide 8: Reserves and Resources
RESERVES AND RESOURCES Resource Tonnage K2O (%) Classification (Mt) Indicated 9.36 375.2 Inferred 8.96 161.8 Total 9.24 537.0 7
Slide 9: Khemisset Project – Key Metrics
KHEMISSET PROJECT – KEY METRICS 2020 Feasibility Study Mine life 19 years Extraction rate 6.0 million tonnes Average Annual MOP production 735k tonnes Average Salt Production 1.0 million tonnes AISC FOB Casablanca ($/tonne) US158/t Upfront CAPEX US411m MOP price per tonne US$412/t Payback 2.4 years
Slide 10: Lowest Quartile Costs
LOWEST QUARTILE COSTS 300 AISC to CFR Brazil, by operation Khemisset 250 – AISC net Khemisset of US$30/t of salt credits 200 $US/Tonne 150 100 50 0 Mining Processing Royalties, Sustaining Capital, and S,G&A Freight Net of Salt By Product Credit Source: Emmerson Feasibility study (Argus, June 2020) 9
Slide 11: The Geology and Location Are Unique Advantages
THE GEOLOGY AND LOCATION ARE UNIQUE ADVANTAGES Khemisset Project BHP Jansen Project (Canada) Total CAPEX $411m $5.5b Construction Time 2 years to completion 6 years + 2 years ramp up Location 135km from Port of Casablanca 1,800km from Vancouver AISC $158/tonne $115/t Total Transportation Cost $29/t
Slide 12: Significant Equity Upside from Net Asset Value
SIGNIFICANT EQUITY UPSIDE FROM NET ASSET VALUE Emmerson trading well below comparator group for junior potash mines: Market Cap USD Flagship Project Country NPV8 USD Market Cap as % of NPV Emmerson 74m Khemisset Morocco 1,400m 5% Western Resources 71m Milestone Canada 154m 46% Gensource Potash 55m T
Slide 13: Offtake, Finance and Permits
OFFTAKE, FINANCE AND PERMITS Strategic equity: GSM $12m invested plus up to $40m new equity at 8.2p. MOUs signed for 490,000tpa potash + 500,000tpa de-icing salt Bank debt mandates to be confirmed Emmerson is now funded to through to a construction decision 12
Slide 14: Environmental Approval
ENVIRONMENTAL APPROVAL ESIA third draft Environmental approval for the project remains outstanding, however progress has been made on a number of fronts: submitted (including revised water sourcing proposal using waste ESIA first submitted water from local 30 November 2020 treatment facility) Mining
Slide 15: National Economic Contribution
NATIONAL ECONOMIC CONTRIBUTION US$4bn+ Total in-country expenditure over life of mine US$2.5bn 95% US$1.6bn Total OPEX over life of mine of total OPEX can flow through Moroccan of total tax revenue to Morocco over life companies, boosting local and national economy of the project 2,485 jobs created
Slide 16: Appendices
Appendices
Slide 17: Emmerson Plc
EMMERSON PLC Number of Ordinary Percentage of Issued Shareholder Shares Ordinary Shares Market Cap: US$74m Global Sustainable 137,770,563 13.6% Minerals Hargreaves Lansdown 114,213,533 11.3% Nominees Limited Clients Jarvis Investment 104,201,974 10.3% Management Nominees Limited Clients Interactive
Slide 18: Board and CFO
BOARD AND CFO Dr. Robert Wrixon – Executive Director. Graham Clarke – CEO. Highly Founder of Moroccan Salts, Rob has 18 experienced potash mining executive. years’ commercial experience in mining. During a career spanning 35+ years, He is a Director and founding partner of a Graham has gained extens
Slide 19: Management Team Credentials
MANAGEMENT TEAM CREDENTIALS Charles Vaughan (Head of Investor Relations) • Charles spend over ten years working in the City with a focus on raising capital for companies developing natural resources projects, mainly from London based institutional investors. Lahcen Alloubane (General Manager) • A Mo
Slide 20: Emmerson Values
EMMERSON VALUES “Doing the right things, and doing them in the right way” R Respect We respect our environment, our stakeholders and each other. I Integrity We act with integrity and lead by example. G Goals We set challenging goals and embrace innovation and change to achieve them H Health & Safety
Slide 21: Investment Highlights
INVESTMENT HIGHLIGHTS US$1.4bn Potash: Lowest Quartile Technical expertise Long-term demand growth Cost Base After Tax NPV8 Experts in building Medium term supply security and running at 2020 prices underground potash mines Highest Supportive 19 Year Mine Life Contribution Standards Jurisdiction to
Slide 22: Emmerson Plc
4% EMMERSON PLC