MBAC Fertilizer completes study for Brazil phosphate project

17 October 2013 20:53  [Source: ICIS news]

HOUSTON (ICIS)--MBAC Fertilizer has received positive results from the feasibility study completed for its Santana phosphate project in Brazil, the company said on Thursday.

Located in the southeastern portion of the state of Para, the high-grade phosphate project is expected to provide supplies of the crop nutrient to the area, which is considered one of Brazil’s fastest growing agricultural regions.

The study showed that the project site has calculated mineral reserves of 45.5m tonnes with an estimated mine life of 32 years. It is expected that by the first year of full operations in 2017 that there could be average production of 500,000 tonnes/year of Single Super Phosphate (SSP).

MBAC estimates that it will have operating cost of $113/tonne (€84/tonne) with granulated SSP selling at an estimated price of $345/tonne.

Toronto-based MBAC said it holds eight exploration claims and has three more under application for a total of almost 98,000 ha. The producer plans on targeting fertilizer markets within the region of Para and neighboring state Mato Grosso, which is the dominant agricultural market within Brazil for both crop production and fertilizer use.

MBAC officials said SSP demand in Mato Grosso is approximately 1.5m tonnes/year and is expected to grow by 2015 to a range of 1.8-1.9m tonnes/year. As a country Brazil imports roughly 67% of its fertilizer needs, and as its agricultural economy continues to grow, so does the need for supplies of fertilizer.

Currently there is no phosphate production in the Santana project area, leaving farmers to depend on product being shipped from other domestic sources or rely on imports. MBAC said this gives the project a great advantage to meet nutrient demand and lessening the cost currently incurred by the area growers.

The Canadian phosphate and potash producer is already active in Brazil as the company’s Itafos Arraias project in Cerrado began operations in July producing granulated SSP. That facility is the first large-scale fertilizer facility in the booming agricultural region of Cerrado.

MBAC previously said at full capacity the annual production rate at Itafos will be 330,000 tonnes of phosphate rock concentrate, which will be used to create approximately 550,000 tonnes/year of SSP.

The company is currently looking at a second phase of development that could potentially double the production by 2015. The open pit operation is estimated to have a mine life of 19 years with reserves measuring at 64.8m tonnes.

“The company continues to search for additional fertilizer opportunities in the Brazilian and other Latin American markets, where strong agricultural fundamentals and unique opportunities are expected to provide attractive growth opportunities in the near future,” said MBAC.

By: Mark Milam
+1 713 525 2653

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