WHO WE ARE POTASSIUM CHLORIDE (KCl ... - Verde Potash

WWW.VERDEPOTASH.COM TSX: NPK
AT-SURFACE POTASH IN THE HEART OF
BRAZIL’S AGRICULTURAL REGION
WHO WE ARE
Verde Potash, a Brazilian fertilizer development company, is
focused on advancing the Cerrado Verde Project located in
the heart of Brazil’s largest agriculture market. Cerrado Verde
hosts a large, at-surface deposit of potash rich rock from
which the company has developed a simple process to
produce potassium chloride (KCl).
POTASSIUM CHLORIDE (KCl)
• A Preliminary Economic Assessment (PEA) for the production
of potassium chloride (KCl) from potash rich rock was
published in February 2012 by SRK Consulting.
• Production process uses off the shelf equipment
similar to that employed in the production of cement
(i.e., standard rotary kiln operating at > 860°C vs. the
cement process at ~1,400°C).
• Process uses simple reagents: salt (NaCl) and
limestone.
Key Economic Highlights:
TOTAL PRODUCTION: 3 MTPY GRANULAR KCl
Phase 1:
0.6 Mtpy
(2015)
Phase 2:
1.6 Mtpy
(2017)
Phase 3:
3.0 Mtpy
(2019)
CERRADO VERDE
A Potash Solution for Brazil’s Growing Potash
Problem
Current 43-101 mineral resource estimate:
TOTAL
INDICATED
TOTAL
INFERRED
CUT-OFF
GRADE (%
K 20)
TRANSPORTATION
ADVANTAGE
TONNA-
GE
(Mt)
AVERAGE
GRADE (% K 20)
7.5 71.08 9.22
7.5 2,763.80 8.91
• Verde has enough material to produce 8 million tons per
yyyear of KCl for more than 36 years.
• Potential mining operation: open pit, friable rock, no
overburden.
• 40,225 m of reverse circulation drilling and 1,717m of
diamond drilling completed over the last three years.
• Our location in Minas Gerais state, Brazil offers a significant
and lasting competitive advantage vs. other suppliers.
• Saskatchewan potash producers face transportation and
logistics costs to blenders in Brazil's Cerrado of US$188
to US$240 per tonne.
• Our privileged location in the Cerrado will provide us with
amongst the lowest delivered cash costs to Brazilian buyers.
Capex per phase
(USD million)
Capex for Total
3 Mtpy production
(USD million)
(excludes sustaining
capital)
Operating Costs
(USD/t KCl)
598 732 1,008
2,338
285
IRR (%) 27.1
After Tax NPV
(USD million), at 10%
discount rate
3,367
1
Average opex for Saskatchewan`s largest potash producer over the trailing 12 months
2
Government of Canada, Ministry of Transportation
PEA was based on the following assumptions:
• Production of 100% granular fertilizer grade KCl (≥60% K20).
• Base case scenario – Total production of 3 Mtpy in three phases:0.6 Mtpy
(start up: H2 2015), 1.6 Mtpy (start up: 2017),3 Mtpy (start up: 2019).
• A total planned production life of 30 years for 3 Mtpy.
3
CRU
4
Santos Port = $43; Paranaguá Port = $26 (Agroconsult)
5
AFRMM = Additional Freight for Renewal of the Merchant Navy : a tax imposed
on inbound Brazilian freight (CRU)
6
Verde Potash Plc estimate
7
Cost to finance one tonne of potash at 5.5% interest for 150 days

KCl (millions of tonnes)
1985
1987
1989
1991
1993
1995
1997
1999
2001
2003
2005
2007
2009
2011
WWW.VERDEPOTASH.COM
TSX: NPK
SYMBOL NPK: TSX
SHARES ISSUED (February 14, 2013) 37,532,430
FULLY DILUTED 41,501,745
52 WEEK: HI/LO C$7.37/C$2.67
3-MONTH DAILY AVERAGE
VOLUME
MARKET CAP (AT $3.04)
CASH POSITION (September 30, 2012)
DEBT $0
29,340
C$114 million
C$21.1 million
POTASH CONSUMPTION PER
FERTILIZER BLENDER DISTRICT
2011
• Approximately 60% of Brazil’s fertilizer consumption
takes place in Minas Gerais and nearby states.
• KCl consumption is expected to grow 5.3% per year in
Brazil through 2020.
(Source: CRU, 2012)
PROJECT LOCATION
BRAZIL’S ANNUAL KCl
CONSUMPTION
9
8
7
6
5
4
3
2
1
0
(Source: FAO, IFA)
DEPENDENCY ON IMPORTED
POTASH
• Brazil was the largest importer of potash in the
world in 2011.
• In 2011, Brazil consumed 8.1 million tonnes of
KCl,.of which 7.5 million tonnes was imported
(ie. imports account for 92% of consumption).
• Brazilian government has a stated goal of
fertilizer independence by 2020.
• Brazil’s potash consumption is forecast by
CRU to reach 12.6 million tonnes of KCl
in 2020.
PRODUCTION FLOWCHART
(Source: CRU Fertilizer Week; FERTECON report
(FERTECON, 2009, /15/); CRU, 2012)
www.verdepotash.com
investor@verdepotash.com
Canada
47 Colborne Street, Suite 307
Toronto, Ontario M5E 1P8
Ph: 1(416)866-2966
Fx: 1(416)866-8829
Brazil
Antônio de Albuquerque, 156, 16º Andar
Savassi – Belo Horizonte-MG, 30112-010
T +55(31)3245-0205
C +55(31)8312-6129
Management
Founder, President & CEO - Cristiano Veloso
Chief Operating Officer – Pedro Ladeira
Chief Financial Officer – Milson Mundim
VP Mining – Rubens Mendonça
VP Engineering – Dr. Patricia Radino-Rouse
VP Corporate Development – Jaret Anderson
Metallurgical Consultant – Dr. Derek Fray
Process Manager – Rodolfo Rezende Silva
Board of Directors
Peter Gundy (Chairman)
Dr. G. Lamartine de P. Fonseca
Dr. Henrique Cavalcanti
Dr. Renato Gomes
Dr. Richard Garnett
Cristiano Veloso
Jed Richardson
Technical Advisory Committee
Ysao Munemassa
Dr. Richard Garnett
Dr. Derek Fray