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Gensource Potash Corporation (TSXV: GSP,OTC:AGCCF) ("Gensource" or the "Company"), a fertilizer development company focused on a sustainable and modular approach to potash production, is pleased to announce the next strategic milestone for its 100% owned Tugaske Project ("Tugaske") located in Saskatchewan.
The Company has executed an Exclusivity Agreement ("EA") with respect to the Tugaske Project with a large and diversified ASEAN conglomerate ("ASEAN Partner").
The EA establishes a framework for a comprehensive partnership that would combine a long-term supply agreement, brought to the project by the ASEAN Partner, with a proposed investment structure to fully fund the construction and commissioning of the Tugaske Project. The completion of the EA represents the next step in realization of Gensource's direct-to-market strategy and its goal to create bespoke and independent supply chains for potash through the development of its unique modular production approach.
Strategic Highlights:
Project Funding Structure: The EA contemplates investment at the asset level sufficient to fund the Tugaske Project through procurement, construction, commissioning, and startup at a target production capacity of 500,000 t/a.
Alignment with Food Security: The agreement is strategically aligned with Gensource's objectives of enhancing regional food security through a secure supply chain of potash from an economic, safe and environmentally responsible Canadian source.
Path to Final Investment Decision: The execution of definitive agreements pursuant to the EA is subject to the ASEAN Partner's completion of a detailed due diligence process and a Tugaske Project Technical Update, an engineering scope of work that will update technical details of the project to match ASEAN Partner requirements and update costs and construction budgets for a minimum 500,000 t/a facility. The process is intended to lead to definitive, binding agreements and a Final Investment Decision ("FID") by all parties. Gensource is fully engaged in facilitating and managing this comprehensive review and update.
The EA entered into by Gensource was negotiated with the ASEAN Partner following an initial due diligence process and grants exclusive negotiation rights for the ASEAN Partner to ultimately develop Tugaske. The ASEAN Partner is committed to fund the Technical Update phase of work leading to FID.
Management Commentary:
"We are extremely encouraged to have reached this strategic milestone with our ASEAN Partner, based on alignment on the issues of food security and environmental sustainability," said Mike Ferguson, President & CEO of Gensource. "The framework for a 500,000 t/a facility underscores the scalability and credibility of the Tugaske Project."
"This proposed agreement goes beyond a typical sales contract," added Stephen Dyer, Chairman of the Gensource Board of Directors. "The supply volume of 500,000 t/a represents a cornerstone commitment for our modular project and validates our model. We welcome the detailed due diligence process and look forward to demonstrating the robustness of the Tugaske Project as we complete the Technical Update and work towards definitive agreements."
Next Steps:
The Company will work closely with the ASEAN Partner to support the detailed due diligence process, while managing the Technical Update work, which is critical to reaching FID for the Tugaske Project. Progress updates will be provided as material developments occur. The focus remains on reaching FID for the Tugaske Project.
About Gensource Potash Corporation:
| For further information on Gensource Potash Corporation, please contact: Mike Ferguson - President & CEO | +1-306-974-6414 |
Further information on Gensource Potash Corporation can be found at www.gensourcepotash.ca
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Caution Regarding Forward-Looking Statements
This news release may contain forward looking information and Gensource cautions readers that forward-looking information is based on certain assumptions and risk factors that could cause actual results to differ materially from the expectations of Gensource included in this news release. This news release includes certain "forward-looking statements", which often, but not always, can be identified by the use of words such as "believes", "anticipates", "expects", "estimates", "may", "could", "would", "will", or "plan". These statements are based on information currently available to Gensource and Gensource provides no assurance that the actual results will meet management's expectations.
Forward looking statements include estimates and statements with respect to Gensource's future plans, objectives or goals, to the effect that Gensource or management expects a stated condition or result to occur, including any offering of securities by Gensource. Since forward-looking statements are based on assumptions and address future events and conditions, by their very nature they involve inherent risks and uncertainties. Actual results could differ materially from those currently anticipated in such statements for many reasons such as: failure to finance the Tugaske Project or other projects on terms which are economic or at all; failure to settle a definitive joint venture agreement with a party and advance and finance the Tugaske Project; changes in general economic conditions and conditions in the financial markets; the ability to find and source off-take agreements; changes in demand and prices for potash; litigation, legislative, environmental and other judicial, regulatory, political and competitive developments; technological and operational difficulties encountered in connection with Gensource's activities; and other matters discussed in this news release and in filings made with securities regulators. This list is not exhaustive of the factors that may affect any of Gensource's forward-looking statements. These and other factors should be considered carefully, and readers should not place undue reliance on Gensource's forward-looking statements. Gensource does not undertake to update any forward-looking statement that may be made from time to time by Gensource or on its behalf, except in accordance with applicable securities laws.
To view the source version of this press release, please visit https://www.newsfilecorp.com/release/283155
