Fertoz Increases Focus on Large Rock Phosphate Deposits in Canada

Fertoz Ltd (ASX:FTZ) (Fertoz or the Company) is pleased to provide an update on its development plans for rock phosphate projects in Canada as it assesses suitability for both the Canadian agricultural market applications (including a high value liquid fertilizer) and the lithium iron phosphate (LFP) battery market.

Highlights

• Fertoz holds some of the largest sedimentary, high-grade (+20% P₂O₅), low impurity rock phosphate assets in Canada, with its Wapiti and Fernie projects located near the Western Prairies of BC and Alberta, a major agricultural region
• Successful bulk mining permitting has occurred in both regions and Fertoz continues to advance applications for two further bulk samples (10,000 tonnes each) and an industrial minerals permit (up to 250,000 tonnes)
• Canada’s Energy and Natural Resources Ministry added phosphate to Canada’s 2024 Critical Minerals List, designating it as a critical mineral for the first time
• Designation is based on its importance to production of fertilizer (phosphorus), necessary for food security, and its growing use in lithium iron phosphate (LFP) battery production, creating a strategic opportunity in North America’s electric vehicle (EV) and battery storage value chain
• Fertoz is reviewing its works program for its Wapiti Project for 2024-25, which contains a combined Inferred and Indicated resource of 1.54Mt at 21.6% P₂O₅ (at a 7% cut off) ^1,2 calculated to a depth of 30m along a strike length of 12.5km.
• Majority of Wapiti’s ~40km strike length is yet to be tested
• Interest received for rock phosphate located at Peace River from manufacturers requiring high-grade rock sourced from Wapiti, BC due to its proximity to the isolated region.
• Fertoz is preparing to test Wapiti rock phosphate core samples from previous drill campaigns for suitability as inclusion into a LFP cathode material for EV batteries and LFP storage batteries.

With the Canadian Government having added phosphate to Canada’s 2024 Critical Minerals List³, Fertoz is reassessing its projects as potential sources of phosphorus for fertilizer, needed for food security, but also for use in lithium iron phosphate (LFP) battery production, which is a growing market.

While it awaits approvals for two 10,000-tonne bulk sample permits and a 150,000t industrial minerals permit, with at least one of these expected to be granted in the current September 2024 quarter, it has begun to prepare core samples produced by previous drilling at Wapiti to determine its suitability for the LFP market as well as a high value liquid phosphate fertilizer.

Fertoz Managing Director and CEO Daniel Gleeson said: “We are in the advantageous position of holding some of Canada’s largest and most advanced sedimentary rock phosphate deposits with resources at a grade that is suitable for organic and regenerative agricultural use and we have demand from customers for this that is growing as we await approval of our permit applications.

However, in parallel with the Canadian Government’s recent decision to add phosphate to its Critical Minerals List, we are also experiencing a high level of inbound enquiries regarding our Wapiti rock phosphate deposit and will commence testing this for its suitability in LFP battery manufacturing – for EV and storage batteries.

With the injection of US$3.5B announced in November 2023 by the U.S. Department of Energy to Strengthen Domestic Battery Manufacturing, the path forward is clear in North America, in particular, securing a supply chain within North America. McKinsey & Company⁴ projected that the entire lithium-ion battery chain, from mining through recycling, could grow by more than 30 percent annually from 2022 to 2030, reaching a value of more than $400 billon and a market size of 4.7 TWh, up from 700GWh in 2022. A significant portion of this is moving towards the inclusion of phosphate within these batteries to provide a much more cost effective, longer life cycle product that is thermally stable, avoiding the current issue of fires often arising in standard lithium-ion batteries.

In addition to this, the production of battery-grade phosphate creates a secondary product that is utilized in the manufacturing of synthetic phosphate fertilizer’s such as MAP and DAP. Currently, the vast majority of Canada’s fertilizer requirements for synthetic phosphate fertilizer production is imported, predominately from the USA, but we see potential in developing our high-grade phosphate deposits to help meet this demand, particularly as shortage concerns continue to grow across North America.

While we have a large, high-grade resource defined at Wapiti, less than a third, or 12.5km, of the estimated 40km strike length of the deposit has been tested to date, providing an opportunity for Fertoz to further grow our phosphate resources, and we are currently determining the way forward to do this. This will include strike extension drilling and potential further depth extension drilling of current resource⁵.”

In May 2015, Fertoz upgraded the existing JORC Compliant Mineral Resource Estimate at Wapiti, BC with 52% of the previously classified Inferred resource moving into the Indicated category. The resource is shallow, having only been tested to a depth of 30m.

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