We all criticise Minbos for failing to keep to the timetable they put forward.
If we look at the history - we had COVID where not much happened world wide, then Russia invaded Ukraine pushing up fertiliser prices which combined with China limiting exports of MAP etc, meant MAP prices went through the roof and was very hard to get hold of. Our EPR needed the import of 16% MAP to enhance our phosphate. At the time our DFS was underway based on EPR. With the above circumstances and favourable plant trials using BPR we changed our strategy mid way through the DFS to produce BPR instead of EPR. In fact the initial flow sheet could produce, Beneficated, granulated or acidulated phosphate. At the time there was a lot of criticism here about the time it was taking to do the DFS, but even with the extra time due to the changes, the DFS didn’t keep up with the way events evolved with a now different flow sheet & different plant location. However they did get on with things while the DFS was being done, fabricating the major equipment.
I think most would agree the current strategy is the right path. That is producing the cheaper BPR rather than EPR. This reduced our capex as well as opex and enabled quick expansion to stage 2 without significant capital. But it did delay the start of construction, the DFS had the civil contractor mobilising to site in March 2023 so we’re about a year behind that timetable. Part of that delay was the reworking of the flow sheet, part the Company’s desire to fund the construction without causing shareholder dilution. This has meant getting offtakes and organising loans etc.
The point of my post is, just as we look back on the brief history I’ve outlined above, I think most would say they’ve done the right thing changing to BPR and reworking the flowsheet. Likewise, I think once they’ve funded the construction & it is properly underway, we’ll look back & think they did the right thing by delaying to avoid dilution. Remember too, interest rates are a lot higher now than when we signed the debt term sheet with the syndicate.
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