Rum ready to fire, page-4

courtesy of ozelectro over at the RWD thread


'IMO this is fantastic news for the junior potash industry, in particular for junior SOP explorers.

http://www.*.com/c...s-with-investment-from-emr-capital-61439.html

EPM Mining secures huge boost to potash ambitions with investment from EMR Capital

9:13 am by Alessandro Bruno

EPM Mining Ventures (CVE:EPK) (OTCQX: EPKMF) received a massive boost to its ambition to become a significant player in the sulfate of potash (SOP) market this morning with the announcement that specialist private equity firm EMR Capital Resources has committed a minimum of C$85 million to support its development work.
“This is a significant milestone toward advancing the Project,” said EPM Chief Executive Officer Lance D’Ambrosio. “EMR has a team with a proven history of developing and operating resource properties that will benefit EPM’s ability to fast-track our efforts as we evolve from development phase to construction-ready stage.”
With the EMR investment, EPM now has two very capable major shareholders to help move the project forward, not to mention considerable validation that the company’s SOP project has serious merit. Tata Chemicals, part of the huge Tata Industrial Group, already owns a large stake in EPM, its interest starting in 2010. Tata owns interests in soil nutrient, fertilizer and chemical businesses and enjoys ready access to markets in India and Africa.
SOP is a value added, specialty fertilizer, suitable for use with soils used to grow fruit, nuts, potatoes and other vegetables. SOP has shown advantages when administered to drought and/or chloride sensitive crops and is increasingly used for these purposes. SOP commands a price premium versus the more common muriate of potash. It is worth noting that since the release of EPM’s PFS, prices of SOP have continued to rise, supporting the unique position SOP holds in the world of commodities. According to Compass Minerals (NYSE: CPM) recent first quarter 2015 earnings release, SOP pricing maintained its robustness, increasing to $803 per metric ton versus $750 in the fourth quarter of 2014, a gain of 7% quarter-on-quarter.
“Potash is one of our four preferred commodities and we see our EPM investment as dovetailing very well with our MOP (muriate of potash) investment Highfield Resources (ASX:HFR),” said EMR Chairman Owen Hegarty. “EPM shares the same criteria that compelled our investment in Highfield: promising resource, lowest quartile CapEx and OpEx, great jurisdiction, proven production process, access to existing infrastructure and excellent management.”
EMP Mining’s Sevier Playa SOP Project in Utah boasts significant environmental and economic advantages compared with many other potash projects, in part due to its close proximity to other brine potash operations, and the unique nature of how SOP is produced.
Sevier Playa consists of a pool rich in potassium brine which is ideal for solar evaporation. Solar evaporation is a proven extraction method most commonly associated with salt and lithium mining. Extraction work is effectively performed by the wind and sun, evaporating water from shallow pools, leaving the SOP behind ready to be collected, washed, drained and refined. Utah is well known for evaporation mining and the technique has been used successfully by Compass Minerals(NYSE:CMP) and Intrepid Potash (NYSE:IPI).
EPM produced a pre-feasibility study in October 2013 that forecast average annual SOP production of 300,000 metric tons with an estimated Net Present Value (“NPV”) of $629 million (after tax, inflated, 8% discount rate) and an estimated Internal Rate of Return (“IRR”) of 20% (after tax, inflated). The PFS included an updated Mineral Resource Estimate of 31.486 million tonnes of SOP in the Measured and Indicated categories.
EMR Capital’s investment will be made in three stages, the first valued at C$10.35 million, with EPM issuing 34,516,129 units at a price of C$0.30 – a significant premium to where the company’s shares have traded in the first quarter of 2015.
The second tranche would be triggered by the achievement of certain milestones by EPM and involve the exercise of the warrants. With the warrant exercise price set at $0.4243 per share, this would bring in C$14.64 million.
The third stage of the investment would be an equity commitment of not less than C$60 million or one-third of project equity based on the net present value to be determined by EPM’s forthcoming feasibility study.
The placement, which is subject to the approval of the Toronto Venture Exchange and EPM shareholders, is expected to close no later than June 30, 2015.
With the investment from EMR Capital, EPM Mining finds itself in the enviable position of being able to focus on advancing its project through the various milestones to development, rather than attempting to secure fresh capital for survival, a predicament many of its peers have been in for the last few years. Additionally, the EMR investment represents the achievement of a significant funding milestone and considerable de-risking of the investment proposition.'