Gensource Announces Corporate Update
SASKATOON, Saskatchewan – May 18, 2017 – Gensource Potash Corporation (“Gensource” or the “Company”) (TSX.V: GSP) is pleased to provide the following corporate update.
The Company has now received confirmation of approval of the first payment of the Initial Contribution financing to its Joint Venture company, Vanguard Potash Corp. (“Vanguard”) from its joint venture partner, Essel Group ME (“EGME”). Pursuant to the executed definitive Shareholder Agreement for Vanguard, announced in a news release April 4, 2017, the financing for the Vanguard One project is a commitment in two tranches: and Initial Contribution of $US 5M and Construction Financing, currently estimated at $US 200M. Further payments will complete the required $US 5M Initial Contribution before construction financing is required to advance the project through construction. Construction financing is also a commitment within the definitive Shareholder Agreement and initial meetings have been held to begin to structure the project financing package.
The feasibility study for Vanguard One continues to progress well and is expected to be substantially complete by the end of May, with the report being published in June. To date, the feasibility study has progressed smoothly, uncovering no major deviations from previous engineering study work.
Efforts continue on the environmental permitting front as well. A detailed Project Proposal submission to the Province of Saskatchewan’s Environmental Assessment Branch is expected in the first half of June this year.
As announced April 27, 2017, the Company is completing a brokered private placement with Industrial Alliance Securities and announces that the closing date is being extended from May 25, 2017 to May 30, 2017.
Mike Ferguson, President & CEO, commented, “The first months of 2017 have been extremely busy and productive for Gensource and its joint venture partner. Milestones have been set and achieved and each new step brings us closer to realizing our main goal of creating new and independent potash production and doing so in an environmentally and economically responsible manner. We look forward to the completion of the feasibility study and the next concrete steps for the Vanguard One project”.
About Vanguard Potash Corp.
The Vanguard joint venture company was created as the vehicle that will own, construct and operate the Vanguard One project to be located on a portion of Gensource’s KL 245 subsurface mineral lease. Vanguard will advance the project with a currently planned first production date in mid-2019. The Vanguard One project will be the first of its kind, utilizing the expertise within Gensource to implement a unique, but proven, mining and processing technology. Vanguard One is planned to produce just 250,000 tonnes/year of white high grade potash – small by potash industry standards, but tremendously cost efficient, competing with any producer in the world on operating cost. Perhaps most significantly, the project will demonstrate the expected reduced environmental and community footprint this unique technology promises, as compared to conventional potash production, setting a new bar for the industry. Pursuant to the Vanguard Shareholder’s Agreement, the parties will use their best efforts to subsequently expand the Vanguard One project from its initial 250,000 t/year production to a target production rate of 1.0 M t/year.
Gensource is based in Saskatoon, Saskatchewan and is focused on developing the next potash production facility in that province. Gensource’s President and CEO, Mike Ferguson, P.Eng., has assembled a management and technical team with direct and specific expertise and experience in potash development in Saskatchewan.
Gensource operates under a business plan that has two key components – vertical integration with the market to ensure that all production capacity built is directed to a specific market, eliminating market-side risk; and, technical innovation which will allow for a small and economic potash production facility, the output of which can then be directed to a single, specific market.
As a reminder, Gensource is in the detailed development phase of the Vanguard One project. The feasibility study, expected to conclude in second quarter 2017, will determine the technical and economic viability of the project.
For further information please contact:
Gensource Potash Corporation:
Mike Ferguson, President & CEO
Telephone: (306) 974-6414