Emmerson (EML) has completed the preliminary cost estimates for the electricity and gas supply at its Khemisset Potash Project in northern Morocco.
The work was completed by independent consultant Golder Associates, as part of the scoping study which the Company expects to be completed in early Q1 2019.
The budgeted cost for construction of connection to existing electrical infrastructure is approximately US$5.7 million, which includes a 30% contingency. While an onsite gas (LPG) storage facility can be constructed at supplier's expense, with zero capex required by Emmerson.
These results have confirmed the potential for significant capital cost savings for the Project thanks to its proximity to excellent infrastructure.
In a previous announcement, it confirmed the cost of connecting the Khemisset site to existing highway infrastructure was approximately US$1.25 million, which also included a 30% contingency.
Hayden Locke, CEO of Emmerson said: “Morocco has invested heavily in electrical generation and transmission capacity throughout the country. As a result, the Project is within close proximity of numerous sites to connect to the electrical grid.”
He added: "Our discussions with one of the largest gas suppliers in Morocco confirm that it is willing to design, build and maintain the gas storage infrastructure required for the mine and processing. This saves us considerable capex which would otherwise be required to construct either a pipeline or onsite storage, at our own expense.”
The Khemisset project has a JORC Resource Estimate (2012) of 311.4Mt @ 10.2% K2O and significant exploration potential, close to European and African markets, which is expected to experience significant growth in fertiliser consumption.
The company has thus far announced, low capital expenditures for mine access, logistics access, as well as gas and supply access, bringing estimated capital cost savings for Emmerson over US$1.1 billion when compared to benchmark projects.
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