Emmerson (EML) may have identified further capital expenditure savings at their Khemisset Potash project, announcing an inquiry into the use of the Port of Casablanca for exporting their product from Morocco.
According to the potash development company’s scoping study of various port options, using the Port of Casablanca could result in a potential capex saving of around $7.5 million.
Additionally, utilising the existing storage and loading facilities at the Port of Casablanca would reduce total transportation and logistics costs, which constitute a “significant proportion” of the delivered costs to the customers.
Mine-to-port logistics cost quotes issues by the Moroccan National Rail Company reiterated these savings by demonstrating that there would also be no change in operating cost for Emmerson.
There would, however, be access to a far wider range and quantity of vessels available at the Port of Casablanca, which could reduce “overall bulk shipping costs to target markets, including Brazil.”
This new avenue further bolsters the financial soundness of the Khemisset Project, which has been confirmed by a scoping study to be among “the lowest capital cost, highest margin potash projects in the world with outstanding economics, including forecasted EBITDA margins in excess of 60% and a post-tax NPV10 of over US$1.1bn based on industry expert price forecasts.”
The use of the Port of Casablanca has the potential to elevate Khemisset’s economic status even further.
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