TRES ESTRADAS PROJECT
Aguia’s Três Estradas Phosphate Project (TEPP) is a low capital expenditure (CAPEX) and low operating expenditure (OPEX) project that will produce a natural phosphate fertiliser product which has achieved yields of up to 98% of those returned using significantly more expensive conventional phosphate fertilisers.
Aguia is aiming to have the TEPP in production by Q1 2022.
PROJECT HIGHLIGHTS
LOW CAPEX
Low CAPEX (A$7.37 million, A$8.11 million with contingency).
LOW OPEX
Low OPEX (A$11.00 per tonne) natural phosphate fertiliser product.
PRODUCTION BY Q1 2022
Aiming to be in production by Q1 2022.
POST-TAX NPV A$70.4 MILLION
Post-tax NPV of A$70.4 million at an 8% discount rate.
PROJECTED IRR OF 61%
A project IRR of 61% and a quick 2.6-year payback period.
A$14.04 MILLION PA
EBITDA (average for years 1 to 18) of A$14.04 million per year.
306,000 TONNES PA PRODUCTION
Aguia is planning to produce 306,000 tonnes of Pampafos® (our natural phosphate fertiliser) per annum from the TEPP site.
DEMAND FOR 2,440,000 TONNES PA IN A 300KM RADIUS
There is demand for 2,440,000 tonnes of phosphate fertiliser per annum (10% P₂O₅) within a 300km radius of the TEPP site.
18 YEAR MINE LIFE
18 year life of mine (without expansion).
PAMPAFOS® – $72 PER TONNE
Aguia expects to sell Pampafos® for A$72 per tonne. This is very competitive compared to Aguia’s competitors who are selling imported and more expensive conventional fertiliser products.
TEPP PAMPAFOS® YIELDS 98%
Agronomic testing on soybean and corn (maize) (the state’s two biggest crops) has confirmed the high quality of Pampafos®. Yields have been returned that are up to 98% of those achieved using conventional phosphate fertilisers.
PROJECT EXPANSION
Aguia holds claims over other phosphate targets (totalling 12,812 hectares) that are in close proximity and display similar geophysical characteristics to the TEPP deposit. Potential to add resource upside to the project.
TIMELINE & KEY MILESTONES
KEY ACTIVITIES
Blue boxes – key activities, Green boxes – company actions completed, Grey boxes – ongoing actions, Yellow boxes – planned actions, Orange boxes – milestones
FINANCIAL METRICS
On 17 December 2020, Aguia released an independent Bankable Feasibility Study for the Três Estradas Phosphate Project (TEPP) compliant with JORC (2012) that reaffirmed the excellent economics reported in the independent Scoping Study released on 12 February 2020.
The Study was conducted by independent consulting firm GE21 Consultoria Mineral Ltda (GE21) in Brazil and included:
- Pit optimisation and design
- Mine scheduling
- Project infrastructure
- Metallurgical tests
- Market studies
- Capital expenditure (CAPEX)
- Operating expenditure (OPEX)
The economic analysis of the Study is based on a Mineral Resource of 5.02Mt at 8.79% P2O5. This represents the oxidised portion (Saprolite) of the Três Estradas phosphate deposit.
The Study returned the following financial metrics:
- A post-tax NPV (at an 8% discount rate) of A$70.4 million
- A post-tax internal rate of return (IRR) of 61%
- A very low CAPEX of A$8.11 million with contingency (including land acquisition)
- A very low OPEX of A$11.00/tonne of Pampafos®
- An average EBITDA for years 1 to 18 of A$14.04 million/year
- There are currently 333,942,440 shares on issue. This EBITDA would equate to annual earnings per share of 4.20 cents
PROJECT FINANCE
The independent Bankable Feasibility Study released on 17 December 2020 confirmed that the Três Estradas Phosphate Project (TEPP) will have a very low capital expenditure (CAPEX) of A$8.11 million (with contingency).
The CAPEX does not include land acquisition (approximately A$2.22 million) as it is a deferred cost.
Aguia plans to fund the CAPEX through a mix of debt and equity.
On 8 June 2021, Aguia announced that the Development Bank of Southern Brazil (Banco Regional de Desenvolvimento do Extremo Sul) (BRDE) had approved a development loan to Aguia of A$3.75 million (R$15 million) for the purpose of CAPEX funding for the TEPP.
BRDE is a recognised and well-respected Brazilian institution that promotes economic and sustainable development in southern Brazil. Following an extensive review of the project, BRDE confirmed that the TEPP met its investment criteria.
At 31 May 2021, combined with cash at bank of A$4.48 million, Aguia has sufficient capital to fund the A$7.37 million (A$8.77 million with contingency) CAPEX for construction of the TEPP.