10 Reasons
1) Richard makes what I believe to be a very profound financial forecast about potash juniors. .” I think about 100 worldwide projects are being considered in potash, both public and private. I would say 10?15% of them have a hope of getting financing, and of that, I think perhaps three or four might actually get financing
2) He also confirms what Bill Doyle CEO Potash Corp. has been telling us for years now…”(BHP Billiton Ltd.) Jansen Project in Saskatchewan needs average long-term potash prices of about $500-$550/t really to make a go of it, and from “my work” the long-term international price is about $410-$425/t. Not good if you need potash to sustain $500 per ton in order to secure long term debt financing…good news if you can make good profits with potash selling at $350 per ton if there is a market downturn in the future…or a glut of potash put onto the market from BHP and Potash Corp…predictions of 25 million new tons in Sask. in the next 10 years… according to both companies. We also know that BHP makes millions from its other mines and can afford to build out Janzen and its other 5 Sask. Properties. It obvious that BHP has a much longer term plan underway.
3) He elaborates on our PEA that is due our within 4 weeks time: he believes it “will “solidify” the measured and indicated resource” With the results pending from the 8 infill drill holes I believe we should move from our 673m tons M/I to over 1 billion tons M/I.
4) He predicts that the PEA: “… will be quite clear that the area will support not just a million tons per year (Mtpa), but 2.0-2.5 Mtpa.” Being able to ramp up to 2.5 m tons per year changes the financial numbers in a big way.
He estimates that “If it's open-pit, opex will be $40-$50/t If it is a solution mine it'll be $65-$70. A typical solution mine with natural gas or coal evaporation costs would be close to $90-$100/t.” That is very material going forward and as we know…the real ongoing costs effect the bottom line. “you'll get a good idea of whether Allana can go to an open-pit or solution or both. More than everything else it'll firm up the opex and capex.
5) He suspects that the PEA will shed some light on Allana having the ability to produce between 20% - 30% of our KCL as SOP…this is a big deal because that could equal 500,000 tons – 750,000 tons of SOP per year from a 2.5 m ton per year mine. Remember, the current world production of SOP is a very tight 6 m tons per year…that means AAA could produce between 8% - 13% of Global Production…
6) Out of all the companies he mentions in the article and after due diligence :Richard Kelertas: I personally and/or my family own shares of the following companies mentioned in this interview: Allana Potash Corp. I personally and/or my family am paid by the following companies mentioned in this interview: None
7) Since the Potash One Deal last year…potash was selling at $350 per ton MOP and is selling for 40% more or $490 per ton MOP.
Add up a revised NI Resource Estimate in a months time with 1 billion tons M+I at 20% KCL + a mine capacity of 2.0-2.5 million tons per year + Operating Costs in the lowest global range of $40 -$70 per ton = a very profitable mine…
8) Longer Term we will find out “who” is going to provide the potash to the 4 million hectares of Domestic Ethiopian Land Leases under development?
9) I believe that we will all hear in due course that Allana has secured an Offtake Agreement with China or Chinese Ag. with dynamics similar to the original agreement with a 20% discounted production for 35% capex costs.
10) Aberdeen (Forbes Manhattan), Liberty (Boston) and IFC (World Bank) have all done their due diligence on AAA and are still invested long term. The last two have also expressed a desire to assist with our project financing….time will tell all. $50 million in the bank and money to pay for our Bankable Feasibility Study due out next year.
courtesy of karmanow via stockhouse
AI
