Twitter

Potash/Phosphate

Potash Corp. sues over alleged flaws in construction of $2.2-billion New Brunswick mine – by Drew Hasselback and Peter Koven (Financial Post – January 22, 2016)

http://business.financialpost.com/

Potash Corp. of Saskatchewan Inc. is suing the engineering company that built part of its $2.2 billion Picadilly mine in New Brunswick, alleging that construction flaws have resulted in the “complete failure” of a mine shaft.

The Saskatoon-based miner seeks unspecified damages from Cementation Canada Inc., which was hired in 2008 to oversee the design and construction of two 900-metre deep shafts at the mine in Penobsquis, N.B.

The timing of this suit is notable, because Potash Corp. announced on Tuesday that it is halting production in New Brunswick and laying off up to 430 workers.

Potash Corp. spokesman Randy Burton said the filing of the lawsuit and the announcement of the production suspension is just a coincidence.

Read more

PotashCorp mine closure in Sussex was unexpected, reporter says (CBC News New Brunswick – January 20, 2016)

http://www.cbc.ca/news/canada/new-brunswick/

Mining reporter Ian McGugan says government intervention would not have stopped the layoffs

The sudden closure of the Picadilly mine operation in Sussex was unexpected even though there were signs the potash industry was in trouble, according to an industry reporter.

Potash Corporation of Saskatchewan announced on Tuesday it was indefinitely closing the Picadilly mine operation and cutting 430 jobs.

Ian McGugan, a mining industry reporter for the Globe and Mail. told Information Morning Moncton on Wednesday there may be hope for the potash industry in the next few years. McGugan says government intervention would not have stopped the layoffs.

Read more

Potash Corp. closes N.B. mine as prices plummet, stock falls – by Ian McGugal (Globe and Mail – January 20, 2016)

http://www.theglobeandmail.com/

In a sign of just how quickly global commodity markets have deteriorated, Potash Corp. of Saskatchewan Inc. is mothballing one of its newest mines – a $2-billion New Brunswick operation that was in production for little more than a year.

The suspension of potash production at the Picadilly, N.B., mine will throw 420 to 430 people out of work. That comes on top of the permanent closing of Potash Corp.’s Penobsquis mine in November, which cost 140 contract jobs in the province.

Plummeting potash prices are mainly to blame. The crop nutrient began its swoon four years ago as weak crop prices and currency declines pinched demand. Prices also suffered from increased competition following the breakup in 2013 of a Russian-Belarussian marketing cartel that previously helped limit supply.

Read more

Potash Corp suspends Picadilly mine in N.B., cuts 430 jobs (CBC News New Brunswick – January 19, 2016)

http://www.cbc.ca/news/canada/new-brunswick/

Saskatchewan company says mining near community of Sussex is suspended indefinitely

Potash Corporation of Saskatchewan is indefinitely suspending its Picadilly mine operation near Sussex, N.B. The move is expected to result in the loss of 420 to 430 jobs.

Mark Fracchia, the president of PCS Potash and a former general manager for the New Brunswick mine, told a news conference that the decision to suspend operations at the mine was “extremely difficult.”

“This is just a very sad day for all of us. Most of all to the people who have given us so many years of loyal service, for the community of Sussex, for the province generally and certainly for all of us at PotashCorp,” Fracchia told reporters.

Read more

Mosaic hopes for Wingate Mine expansion by spring – by Matt M. Johnson (Bradenton Herald – January 2, 2016)

http://www.bradenton.com/

DUETTE — Mosaic Co., world’s largest manufacturer of phosphate-based chemical fertilizers, expects to be approved to begin digging up 3,700 acres of East Manatee County farmland next summer.

The acreage, an extension of mining operations at the company’s 11,000-acre Wingate Creek phosphate mine on the border with Hardee County, is part of a shift of Mosaic’s business to south central Florida and Manatee County in particular. If approved, a rezone for the company’s so-called Wingate East lands would sustain mining there for another two decades.

Mosaic plans have an even bigger presence in Manatee County in the coming years. Its planned 40,000-acre DeSoto mine straddles DeSoto County and southeastern Manatee County.

Read more

Mines to stacks, Mosaic seeks to redefine environmental legacy – by Matt M. Johnson (Bradenton Herald – January 2, 2016)

http://www.bradenton.com/

DUETTE — The Mosaic Co. is the biggest player in an industry with a reputation for polluting and scarring the land. While company officials acknowledge the phosphate mining legacy, they say they are also trying to redefine that environmental legacy.

Given what mining has left behind, burnishing a questionable legacy may be the toughest thing the company hopes to do.

The first century of phosphate mining in Florida left vast open mining pits on rural lands. Concentrated hazardous waste created in processing phosphate into agricultural fertilizers could remain a threat to the health of people and the environment for hundreds or thousands of years.

Read more

What is phosphate? – by Matt M. Johnson (Bradenton Herald – January 2, 2016)

http://www.bradenton.com/

DUETTE — At its Wingate Creek and Four Corners mines in Manatee County, Mosaic is digging phosphate rock out of the earth for use as the primary component in the agricultural fertilizers it manufactures.

Rich in an essential plant nutrient, phosphorous, the rock lies beneath the surface in deposits throughout central Florida. Left behind when sea water receded from Florida about 15 million years ago, much of the phosphate collected is in a formation known as the Bone Valley. The 1.3-million acre formation stretches between modern-day Polk, Hillsborough, Desoto and Manatee counties.

Florida is now home to 27 phosphate mines covering more than 491,900 acres, according to the Florida Department of Environmental Protection.

Read more

NEWS RELEASE: ARIANNE PHOSPHATE RECEIVES MINISTERIAL DECREE FOR ITS LAC À PAUL PROJECT [QUEBEC]

http://www.arianne-inc.com/en/

Saguenay, Quebec – December 22, 2015 – (TSX VENTURE: DAN) (FRANKFURT: JE9N) (OTCBB: DRRSF), a development-stage phosphate mining company, advancing the Lac à Paul project in Quebec’s Saguenay-Lac-Saint-Jean region, is today pleased to announce that its project has received approval from the Cabinet of the Government of Quebec.

“There could not have been a better way to end the year for Arianne and the region as a whole,” remarked Jean-Sebastien David, Arianne’s COO. “The Ministerial Decree represents the most significant milestone to date for the project and with it, Arianne now has the permission it needs to go ahead with the development of its proposed $ 1.2 billion phosphate project.

The board and the Arianne team want to thank the Government of Quebec for the confidence they have shown in this project through the issuance of the Decree and, of course, greatly appreciate the support we have received from the municipalities and organizations that have been behind this project.

Read more

PotashCorp, Canpotex optimistic, despite potash price drop – by Bruce Johnstone (Regina Leader-Post – December 6, 2015)

http://leaderpost.com/

With last week’s meeting of OPEC in Vienna, market watchers are watching Saudi Arabia — OPEC’s leader and one of the world’s largest producers of oil — to see if oil prices continue to fall.

But another commodity with importance to Saskatchewan has also seen some price slippage recently — potash. While not as sharp as oil’s plunge, potash prices have fallen US$15 per tonne to US$282 per tonne from US$297 since March.

Some commentators suggest that Canpotex, the offshore marketing agency for Saskatchewan’s three major potash producers, is like the OPEC of potash and PotashCorp its Saudi Arabia.

Read more

On-again, off-again Vale potash project at Kronau off again – by Bruce Johnstone (Regina Leader-Post – November 20, 2015)

http://leaderpost.com/

Vale Potash’s proposed $3.5-billion solution potash mine at Kronau is being put on hold as the Brazilian mining giant waits for market conditions in the potash industry to improve, says a spokesman for Vale Potash in Regina.

The company announced the decision to suspend work on the mine in a public letter to the community of Kronau, 28 km southeast of Regina, and the surrounding rural municipality. Vale says the recent feasibility study still shows a compelling case for a mine in Kronau someday, but market conditions make it difficult to finance the project right now.

“Give the global economic conditions, I don’t think it’s a big surprise,” said Matthew Wood, senior project leader for Vale Potash, in an interview Thursday.

Read more

Stung by weak prices, potash miners look to specialty products – by Rod Nickel (Reuters U.S. – Novmeber 18, 2015)

http://www.reuters.com/

WINNIPEG, MANITOBA – Nov 18 Potash miners, facing another round of tough negotiations with big buyers in China and India, are looking to support sinking profits by boosting sales of higher-margin specialty products, according to top executives.

The pink fertilizer’s price has fallen sharply this year, under pressure from bloated capacity, soft grain prices and weak currencies in Brazil and India, spurring Potash Corp of Saskatchewan, Mosaic Co and Belaruskali to slice output.

Miners face further pressure as they start talks in coming weeks with China’s Sinofert Holdings Ltd for a 2016 supply contract, which generally sets a global price floor.

Read more

NEWS RELEASE: Q3: PotashCorp Reports 2015 Third-Quarter Earnings of $0.34 per Share (October 29, 2015)

http://www.potashcorp.com/

Key Highlights

  • Third-quarter earnings of $0.34 per share1, including $0.03 per share related to notable non-cash charges, primarily in phosphate
  • Annual earnings guidance adjusted to $1.55 – $1.65 per share
  • Preparing for closure of Penobsquis mine and inventory shutdowns at Cory, Allan and Lanigan

CEO Commentary

“Broader emerging market concerns have weighed on customer sentiment, contributing to a weaker fertilizer environment in the second half of 2015,” said PotashCorp President and Chief Executive Officer Jochen Tilk. “In response, we are moving forward the permanent closure date of our Penobsquis, New Brunswick mine and planning inventory shutdowns in December at three of our Saskatchewan mines.

Read more

RPT-UPDATE 2-Potash Corp withdraws $8.9 bln takeover bid for German peer K+S – by Greg Roumeliotis and Arno Schuetze (Reuters U.S. – October 5, 2015)

http://www.reuters.com/

NEW YORK/FRANKFURT, Oct 5 (Reuters) – Potash Corp of Saskatchewan said on Monday it had withdrawn its 7.9 billion euro ($8.9 bln) offer for German potash producer K+S , citing a decline in global commodity and equity markets and a lack of engagement by K+S management.

K+S shares dropped 24 percent after Potash announced its decision in a statement, wiping almost 1.5 billion euros off the company’s market value.

An acquisition of K+S would have given Potash Corp an opportunity to realize savings from selling potash within North America from its own Western Canada mines and from K+S’s Legacy mine, which is under construction in the region.

However, senior K+S executives dismissed the Canadian company’s 41-euro-per-share cash bid — which represented a 59 percent premium to the volume-weighted average of K+S’s share price during the prior 12 months — as too low and refused to negotiate.

Since Potash Corp made its offer to K+S privately at the end of May, shares of K+S peers have dropped by around 40 percent amid concerns over weakening demand from China, the world’s largest consumer of potash.

Read more

Potash Corp.’s K+S Bid Helped by Commodity Slide, Analysts Say – by Scott Deveau and Jack Kaskey (Bloomberg News – September 24, 2015)

http://www.bloomberg.com/

Potash Corp. of Saskatchewan’s 7.85 billion-euro ($8.77 billion) proposal to acquire its largest European competitor is more attractive after price declines in the Canadian company’s namesake crop nutrient, according to two analysts.

Potash Corp.’s cash offer made in June was rejected by K+S AG of Germany as too low. Since then, spot prices for potash in the U.S. have dropped 12 percent and there have been forecasts for further declines on the export market. On Monday, Mosaic Co., the largest U.S. producer, said it was cutting output and blamed weaker demand.

Share prices of potash miners have fallen accordingly. K+S is down 9.3 percent this month and closed at 30.22 euros in Frankfurt on Wednesday. That makes Potash Corp.’s 41-euros-a-share bid attractive, said Nils-Peter Gehrmann, an analyst with Hauck & Aufhauser, and Jeffrey Stafford at Morningstar Equity Research.

“While we’re certain management believes EUR 41 per share undervalues K+S, we think the offer considerably overvalues the company,” Chicago-based Stafford said in a note Tuesday. He said his fair value estimate for K+S is 24 euros a share.

Read more

Potash Pessimism Clouds Prospects for BHP’s Jansen Project – by David Stringer (Bloomberg News – September 21, 2015)

http://www.bloomberg.com/

BHP Billiton Ltd.’s prospects of building potash into the fifth pillar of its portfolio of big-ticket businesses is looking a long way off. That’s the view of Macquarie Group Ltd., which has a “very pessimistic view” of the market.

The world’s biggest miner’s Jansen project in Canada, which has already consumed about $3.8 billion in capital, is unlikely to be developed unless prices rise, according to Macquarie. The bank has cut its long-term price forecast by 16 percent to $280 a metric ton.

“Our base-case scenario for BHP assumes the indefinite deferral of Jansen’s development,” Macquarie analysts wrote in a note to clients dated Sept. 21. The company will probably favor development of less capital intensive petroleum and copper projects, they said.

Mosaic Co., the largest U.S. producer of potash fertilizer, said Monday it plans to reduce output as low crop prices continue to erode farmer demand for agricultural products.

Read more