TORONTO, Sept. 23, 2013 /CNW/ - Verde Potash (TSX: "NPK") ("Verde" or the "Company") is pleased to announce that the
Company has been selected by Inova Agro, a special financing progam of
the Brazilian government, to advance to the next round of evaluation in
the process to secure financing for Phase 1 of the Cerrado Verde
project. Phase 1 of the Cerrado Verde project consists of a 1,000 tpd
plant capable of producing ThermoPotash and also of seeking performance
guarantees for a large scale KCl kiln. Inova Agro is a Brazilian
government program intended to fund innovative projects in the
agriculture sector, including those focused on fertilizers. Total funds
to be distributed by Inova Agro are budgeted at R$1 billion
(approximately C$450 million), with funding allocation decisions to be
announced in February 2014. Selected projects will be considered for
subsidized interest rates, equity investment and non-reimbursable
project investment grants from the Brazilian Development Bank ("BNDES")
and/or the Financing Agency for Studies and Projects ("FINEP"), both of
which are arms of the Brazilian government with a mandate to support
domestic projects.
Inova Agro
Inova Agro is an initiative of the Brazilian government aimed at
coordinating the resources of BNDES and FINEP to provide financial
subsidies to innovative projects in the agriculture sector. The Inova
Agro support program involves a specific set of criteria and a schedule
for the distribution of funds. Verde submitted its application and
support documentation to the Inova Agro program in August 2013 and has
been notified of its selection to advance to the program's next round
of evaluation. On January 31, 2014, Inova Agro is scheduled to release
the names of projects chosen to receive funding. Companies and projects
that are successful in securing financial support from Inova Agro will
have funding plans set in February 2014.
The Inova Agro program targets three business sectors for funding:
agribusiness inputs, food industry processing and agribusiness
equipment. The Company's Cerrado Verde project expects to significantly
contribute to Brazil's production of potash fertilizers and therefore
fits into the inputs for agribusiness (fertilizers) portion of the
program.
Inova Agro is part of the larger Inova Empresa program, which spans a
number of sectors. The total budget for Inova Empresa is R$32.9 billion
(approximately C$15.0 billion). While the budget for Inova Agro
provides for R$1 billion in funding, this figure could increase at the
discretion of the funding institutions (BNDES and FINEP).
Management believes that access to debt funding from the Inova Agro
program could act as a significant advantage for the Cerrado Verde
project. The Company looks forward to working with the Inova Agro
Evaluation Committee over the coming months.
About BNDES
The Brazilian Development Bank (BNDES), a state-owned company, is the
main financing institution for development in Brazil. Since its
foundation in 1952, the BNDES has played a fundamental role in
stimulating the expansion of industry and infrastructure in the
country. Over the course of the Bank's history, its operations have
evolved in accordance with the Brazilian socio-economic challenges;
today they include support for exports, technological innovation,
sustainable socio-environmental development and the modernization of
public administration.
The Bank offers several financial support mechanisms to Brazilian
companies of all sizes as well as public administration entities,
enabling investments in all economic sectors. In any supported
undertaking, from the analysis phase up to the monitoring, the BNDES
emphasizes three factors it considers strategic: innovation, local
development and socio-environmental development.
About FINEP
The Financing Agency for Studies and Projects (FINEP) is a state-owned
company under the Brazilian Ministry of Science and Technology that
promotes economic and social development by fostering innovation in
public and private companies, universities, technological institutes
and other public and private institutions in the country.
Founded in 1967, the organization has funded thousands of successful
initiatives, including the development of Embrapa, Brazilian
agribusiness projects, oil exploration and development of the aircraft
Embraer Tucano.
Management Appointment
The Company is pleased to announce the appointment of Mr. Tim Slater as
Chief Financial Officer. Mr. Slater is the Managing Director of Harmer
Slater Chartered Accountants in the United Kingdom, and has been
involved in the preparation of all of the Company's financial
statements and audit materials since 2007. Mr. Slater has acted as
Finance Director for a range of companies in the UK.
The Company also wishes to announce the retirement of Mr. Henrique
Cavalcanti as a Director of the Company. Mr. Cavalcanti has served the
Board diligently over the past four years. He is retiring from public
company duties at the age of 84 after a long and distinguished career
that included service as Brazil's Minister of the Environment (1994),
Deputy Minister of Mines (1967-69) and Deputy Minister of Interior
(1969-1974).
About Verde Potash
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 is the source of a
potash-rich deposit from which the Company intends to produce both
ThermoPotash and potassium chloride (KCl). ThermoPotash is a
controlled-release, non-chloride, multi-nutrient fertilizer that is
ideally suited for Brazilian soils. In addition, the Company is
developing its Calcario limestone project, limestone being a key raw
material in the Company's process to produce both ThermoPotash and KCl.
About the Cerrado Verde Potash Project
Cerrado Verde is a unique project: 1) its high grade potash rock
outcrops and is amenable to strip mining, allowing fast construction of
a scalable operation; 2) it is located in the midst of the world's
third largest and fastest growing fertilizer market; 3) it connects to
Brazil's largest fertilizer distribution districts via existing and
high quality infrastructure; 4) it has the potential to supply both
ThermoPotash and KCl to Brazil's local agriculture market from its
large potash-rich deposit.
Forward Looking Information
This news release contains certain forward-looking information, which
includes but is not limited to, statements with respect to the
Company's strategy, funding of the Cerrado Verde project, the
commercial production of ThermoPotash and KCl, design and building of a
Flex Plant, timing and completion of a prefeasibility study, receipt of
environmental permits, and the generation of cash flow from Phase 1 of
the new strategy. Forward-looking information involves known and
unknown risks, uncertainties and other factors which may cause actual
results, performance or achievements of the Company to differ
materially from the forward-looking information. Material risk factors
that could cause actual results to differ materially from such
forward-looking information include, but are not limited to, the
failure to obtain necessary regulatory approvals, failure to receive
funding from Inova Agro, failure to obtain financing on acceptable
terms, risks associated with the mining industry in general (e.g.,
operational risks in development, exploration and production; delays or
changes in plans with respect to exploration or development projects or
capital expenditures; the uncertainty of estimates and projections
relating to production, costs and expenses, and health, safety and
environmental risks), commodity price, demand for ThermoPotash and KCl
in Brazil, exchange rate fluctuations and other risk factors set out in
the Company's most recently filed Annual Information Form under the
heading "Risk Factors". Currently, ThermoPotash is not commercially
produced or sold in Brazil. As a consequence, there is no current
market for this product. Should commercial demand for ThermoPotash fail
to develop, the Company's business model may not be appropriate.
Accordingly, readers should not place undue reliance on such
forward-looking information. Material factors or assumptions used to
develop such forward-looking information include, but are not limited
to, the demand for ThermoPotash and KCl in Brazil, the ability to
secure necessary environmental and mining permits, the ability to
secure financing, and other assumptions set out in the Company's
current technical report. The Company does not currently intend to
update forward-looking information in this news release except where
required by law.
|
SOURCE Verde Potash Plc
