Salt Lake Potash Limited Binding Offtake With Mitsui & Co. (3819D)
19 Febbraio 2020 - 08:00AM
UK Regulatory
TIDMSO4
RNS Number : 3819D
Salt Lake Potash Limited
19 February 2020
19 February 2020 AIM/ASX Code: SO4
SALT LAKE POTASH LIMITED
-------------------------
BINDING OFFTAKE WITH MITSUI & CO.
Salt Lake Potash Limited (SO4 or the Company) is pleased to
announce it has signed a binding term-sheet with Mitsui & Co.
for the sale of premium water soluble Sulphate of Potash (SOP) from
its Lake Way Project in Wiluna, Western Australia. Mitsui is a
major global manufacturer and distributor of fertilisers and will
deliver the product into key Asian markets. The Company has now
secured offtake for 224kt per annum of the 245kt per annum Lake Way
production, with the remaining tonnes expected to be sold into
local and spot markets.
HIGHLIGHTS
-- The agreement with Mitsui & Co. is for the sale of SOP
into Bangladesh, Cambodia, Japan, Malaysia, Philippines, South
Korea, Sri Lanka and Taiwan over a period of five years.
-- SO4 will initially provide 4kt per annum of SOP to Mitsui.
Mitsui and SO4 are developing a further agreement for additional
tonnes of water soluble SOP to be sold into emerging markets.
-- The water soluble market provides premiums of up to 20% above
standard SOP pricing. The production of water soluble SOP by SO4 is
a key competitive advantage in the seabourne SOP market.
-- The agreement represents a further endorsement from a major
global fertiliser distributor for both the Lake Way Project and its
premium SOP products.
-- The Company now has a global portfolio of five offtake
partners covering sales across six continents.
OFFTAKE TERM SHEET
Mitsui & Co., Ltd. is one of the largest trading and
investment companies in the world with over 42,000 employees
(consolidated). Its Nutrition & Agriculture Business Unit is
involved in the manufacture and sales of agrochemicals and
fertilisers, as well as providing global logistics services for
fertiliser resources and raw materials, alongside Animal and Human
nutrition business lines.
The Binding Term Sheet signed between Salt Lake Potash and
Mitsui is for 4,000 tonnes of SOP per annum for five years from the
date on which the Project becomes operational.
Table 1: Mitsui Term Sheet - Key Terms
Terms
===================== ==============================================================
Counterparty Mitsui & Co. (Asia Pacific) PTE. LTD.
===================== ==============================================================
Conditions Precedent Effective upon Lake Way Project becoming operational.
===================== ==============================================================
Product Lake Way SOP representative of the typical
values in the following specifications:
* Fertigation Grade - Water soluble SOP
o K 44%
o K(2) O 53%
o Cl <0.1%
o Insolubles <0.09%
o Solubility 11.9g/100gH(2) O
o Dissolution >95% in 1 minute
===================== ==============================================================
Term 5 years from the date on which the Lake Way
Project becomes operational
===================== ==============================================================
Territory Bangladesh, Cambodia, Japan, Malaysia, Philippines,
South Korea, Sri Lanka, Taiwan
===================== ==============================================================
Quantity 4,000 tonnes per annum
===================== ==============================================================
Price Quarterly pricing mechanism with defined fall
back price
===================== ==============================================================
LAKE WAY OFFTAKE PORTFOLIO
Salt Lake Potash has now secured offtake for 224kt of its 245kt
capacity from its Lake Way Project, with the remaining 21kt
expected to be sold as additional volume to the offtake partners
and into the local and spot markets.
For further information please visit www.so4.com.au or
contact:
Tony Swiericzuk / Richard Knights Salt Lake Potash Limited Tel: +61 8 6559 5800
Colin Aaronson / Richard Tonthat / Seamus Grant Thornton UK LLP (Nominated Adviser) Tel: +44 (0) 20 7383 5100
Fricker
Derrick Lee / Peter Lynch Cenkos Securities plc (Joint Broker) Tel: +44 (0) 131 220 6939
Rupert Fane / Ernest Bell Hannam & Partners (Joint Broker) Tel: +44 (0) 20 7907 8500
The information contained within this announcement is deemed to
constitute inside information as stipulated under the Market Abuse
Regulations (EU) No. 596/2014. Upon the publication of this
announcement, this inside information is now considered to be in
the public domain.
Appendix A - Competent Person Statement and Disclaimer
Competent Persons Statement
The information in this announcement that relates to Production
Targets and Ore Reserves for Lake Way is extracted from the
announcement entitled 'Outstanding Bankable Feasibility Results for
Lake Way' dated 11 October 2019. This announcement is available to
view on www.so4.com.au. The information in the original
Announcement that related to Production Targets and Ore Reserves
was based on, and fairly represents, information compiled by Mr Ben
Jeuken, who is a member of the Australasian Institute of Mining and
Metallurgy and a member of the International Association of
Hydrogeologists, and Mr Robert Kinnell, who is a member of the
Australasian Institute of Mining and Metallurgy and a Fellow of the
Geological Society of London. Mr Jeuken is employed by Groundwater
Science Pty Ltd, an independent consulting company. Mr Kinnell is a
full time employee of Salt Lake Potash Limited. Mr Jeuken and Mr
Kinnell have sufficient experience, which is relevant to the style
of mineralisation and type of deposit under consideration and to
the activity, which they are undertaking to qualify as a Competent
Person as defined in the 2012 Edition of the 'Australasian Code for
Reporting of Exploration Results, Mineral Resources and Ore
Reserves'. Salt Lake Potash Limited confirms that it is not aware
of any new information or data that materially affects the
information included in the original market announcement. Salt Lake
Potash Limited confirms that the form and context in which the
Competent Person's findings are presented have not been materially
modified from the original market announcement.
Production Target
The Lake Way 245ktpa Production Target stated in this
presentation is based on the Company's Bankable Feasibility Study
as released on 11 October 2019. The information in relation to the
Production Target that the Company is required to include in a
public report in accordance with ASX Listing Rule 5.16 and 5.17 was
included in the Company's Announcement released on 11 October 2019.
The Company confirms that the material assumptions underpinning the
Production Target referenced in the 11 October 2019 release
continue to apply and have not materially changed.
Forward Looking Statements
This announcement may include forward-looking statements. These
forward-looking statements are based on Salt Lake Potash Limited's
expectations and beliefs concerning future events. Forward looking
statements are necessarily subject to risks, uncertainties and
other factors, many of which are outside the control of Salt Lake
Potash Limited, which could cause actual results to differ
materially from such statements. Salt Lake Potash Limited makes no
undertaking to subsequently update or revise the forward-looking
statements made in this announcement, to reflect the circumstances
or events after the date of that announcement.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
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February 19, 2020 02:00 ET (07:00 GMT)
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