Ann: Annual Report to shareholders, page-2

ARs are a recap, nothing we don’t already know, but I trust this reminds the faithful why there has always been deep, unlocked strategic value in this investment. Forget how this trades, HFR is now geopolitically significant and it’s value is finally on the verge of getting unlocked…



The updated project economics resulted in an NPV8 of €1.89 billion and an IRR of 25% over a 30- year mine life, while the sensitivity analysis using December 2021 flat real spot prices for the whole life of mine resulted in a post-tax NPV8 of €2.8 billion and an IRR of 42%.

Richard Crookes going out with a bang: Economic and trade sanctions enacted on Belarus during the year started to restrict the export of MOP from this major producer and exporter, which saw increases in the price of Granular MOP from €230-240/t (cfr Europe) at the start of 2021, to €575-600/t (cfr Europe) by the start of 2022. The recent tragic war in Ukraine and subsequent severe sanctions placed on both Russia and Belarus, have led to circa 40% of global MOP supply no longer reaching its intended customers. As a result, the Granular MOP price has continued to rise to €615-690/t (cfr Europe) by the second week of March 2022. Notwithstanding the disastrous events that have led to this outcome, Highfield is well positioned to benefit, given Muga’s independent position outside of the highly concentrated supply regions of Belarus/Russia and Canada, being ideally located for the key markets of Western Europe, Brazil, US, and Africa. In addition, industry advisors Argus estimate circa 40% of potash capacity expansion projects in the decade ahead are in Russia, which are clearly now at risk. This bodes well for Highfield as the strong bottom line economic benefits of higher pricing will attract stronger support for Muga from financiers, off takers and investors.

Ignacio Salazar sending home the message: Recent events in Russia and Belarus have only increased the awareness of the strategic value of the Muga project for the country and the European Union.