Emmerson Plc · LSE:EML
Emmerson — Investor Presentation (May 2022)
21 slides from Emmerson's investor presentation, May 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 – May 2022
Slide 2: Investment Highlights
INVESTMENT HIGHLIGHTS US$1.4bn Potash: Lowest Quartile Technical expertise Long-term demand growth Cost Base After Tax NPV8 Experts in building Medium term supply security and running at 2020 prices underground potash mines Highest Supportive 19 Year Mine Life Contribution Standards Jurisdiction to
Slide 3: Khemisset Potash Project
KHEMISSET POTASH PROJECT SPAIN ep kenitra f Rabat e Mohammedia Main Cities — Roads FA Marrakesh @ Ports Railways Youssoufia © OCP NPK Blending facility @ OCP Phosphate Mines 1 {J Licence Area 100km_
Slide 4: Khemisset Project – Key Metrics
KHEMISSET PROJECT – KEY METRICS 2020 Feasibility Study Mine life 19 years Extraction rate 6.0 million tonnes Average Annual MOP production 735k tonnes Average Salt Production 1.0 million tonnes AISC FOB Casablanca ($/tonne) US$158t Upfront CAPEX US$411m Original 2020 MOP prices Restated at US$800/t
Slide 5: Reserves and Resources
RESERVES AND RESOURCES Resource Thickness Tonnage K20 (%) Classification (m) (Mt) Indicated 2.64 9.36 375.2 Inferred 2.05 8.96 161.8 Total 2.46 9.24 537.0 Reserve K20 (%) Tonnage (Mt) Classification Probable 9.06 80.5 Inventory 8.03 15.4 Unclassified 6.07 13.3 Total 8.55 109.2 4
Slide 6: What is Potash
WHAT IS POTASH Potash (MOP) is a fertiliser used to increase crop yields and improve the quality of plants • There are three key plant macronutrients: potassium (K), nitrogen (N) and phosphate (P). • MOP is the most important K fertiliser product in the world, accounts for c 95% of global demand. •
Slide 7: Potash Prices
POTASH PRICES USS/Bushel 1,800 1,800 1,600 1,600 1,400 1,400 1,200 1,200 1,000 1,000 800 800 600 600 400 400 200 200 0 0 May 2017 Nov 2017 May 2018 Nov 2018 May 2019 Nov 2019 May 2020 Nov 2020 May 2021 Nov 2021 May 2022 Date Wheat Corn Soybeans emmmm=Potash USS/t
Slide 8: Global Potash Production
GLOBAL POTASH PRODUCTION 2021 global MOP production was 72Mt of which 27Mt (38%) was from Russia and Belarus Global MOP production 2021: Saskatoon 7
Slide 9: 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 10: The Africa Challenge
THE AFRICA CHALLENGE Africa will account for the majority of global population growth, but uses very little fertiliser on its cultivated land 9
Slide 11: The Geology and Location Are Unique Advantages
THE GEOLOGY AND LOCATION ARE UNIQUE ADVANTAGES Khemisset Project BHP Jansent Project (Canada) Total CAPEX $411m $5.5b Construction Time 2 years to completion 6 years + 2 years ramp up Location 185km from Port of Casablanca 2000km from Vancouver AISC $158/tonne $115/t Total Transportation Cost $29/t
Slide 12: 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) 1
Slide 13: 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 102m Khemisset Morocco 1,400m 7% Western Resources 59m Milestone Canada 154m 38% Gensource Potash 100m
Slide 14: 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 15: Appendices
Appendices
Slide 16: Emmerson Plc
EMMERSON PLC Number of Ordinary Percentage of Issued Shareholder Shares Ordinary Shares Market Cap: US$117m Hargreaves Lansdown 114,213,533 12.48% Nominees Limited Clients Jarvis Investment 104,201,974 11.39% Management Nominees Limited Clients Interactive Investor 61,505,928 6.72% Services Nominees
Slide 17: 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 18: Management Team Credentials
MANAGEMENT TEAM CREDENTIALS Charles Vaughan (Chief Commercial Officer) • 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 Moro
Slide 19: Ongoing Site Works to Support Basic Engineering
ONGOING SITE WORKS TO SUPPORT BASIC ENGINEERING Deep Drilling (Decline Alignment) Campaign Surface / Shallow Geological Investigations Core Logging, Testing & Storing The drilling campaign of 200m (DA-1), 400m This program has finished. The campaign Local to the site, there is a well managed (DA-2),
Slide 20: Mission Statement
MISSION STATEMENT We will strive to “always do the right thing and always do it 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 achiev
Slide 21: Emmerson Plc
4% EMMERSON PLC