Ann: Premium Grade Water Soluble Sulphate of Potash Produced, page-18

I think you are on to something with capital intensity.

Again referring to APC, they quote bore field and pond capex at A$48M & 26M respectively.
If we were to ignore MOP conversion, to achieve 150Ktpa we can probably assume that the capex costs above would rise to 62M & 39M respectively. This ignores the fact that they probably can't accomodate the extra pond area.

Using these figures the capital intensity for APC rises to $1633/T. It is fair to suggest that MOP conversion is about reducing capital costs.
Furthermore by just using their resource without MOP conversion they would reduce their mine life significantly.

If we look at the KLL(base case) and APC operating costs at US$208 & 262 respectively, are we to really believe that APC can import around 43Ktpa of MOP and only increase operating costs by US$54/T above KLL costs?

The annual difference in operating costs (assuming equal outputs of 150Ktpa) is US$8.1M extra for APC (150M x 54). This equates to a MOP cost of approx US$188/T (43ktpa, 8.1M/43000).

How are they able to import MOP, truck and convert for US$188/T. APC must be making significant savings elsewhere?

The project with the lowest capital intensity is RWD, they also have a FOB cost less than APC.

I think it is actually becoming harder to compare these projects because of the 'clever' financial modelling and accounting going on.