27th Feb 2025 13:07
(Alliance News) - Kore Potash PLC on Thursday estimated the costs to building its Kola project in Republic of Congo at USD2.0 billion.
The London-based company said capital cost on a signed fixed price engineering, procurement & construction contract amounts to USD2.07 billion.
Kore signed the engineering, procurement & construction contract for Kola with PowerChina International Group Ltd in November last year.
It warned that there is no certainty that Kore will be able to raise the required funding when needed and it is possible that such funding may only be available on terms that may be highly dilutive or adversely affect its shareholders.
Kore also said it expects Kola construction to start date of January 1, 2026, with a construction period of 43 months.
Kola was designed with a nameplate capacity of 2.2 million tonnes per annum of potash on average. Average cost of potash delivered to Brazil is USD128 per tonne.
Average annual earnings before interest, taxes, depreciation and amortisation is about USD733 million, Kore said.
"The Kola project is of global significance as the security of the world's food supply is at the mercy of global disruptions to fertilizer supply," Kore Chief Executive Officer Andre Baya said.
Recent geopolitical events have highlighted this risk as potash production is concentrated among a small number of companies and countries, Baya said.
Kore estimates more than half a billion tonnes of sylvinite in the measured and indicated categories at a grade of 35% potassium chloride or KCl, which is on par with the highest grade operating potash mines globally.
In London Thursday afternoon, Kore shares rose 3.1% to 2.68 pence, but they remained flat at 64 rand cents in Johannesburg.
By Artwell Dlamini, Alliance News reporter
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