LOCATION & INFRASTRUCTURE
The Project has a JORC-compliant Measured and Indicated Resource of 83Mt grading at 4.11% P205 and another 21.8 Mt grading at 3.6% P205 of Inferred Resource.
This project will consume less than 5% of this Resource. See Future Development below.
In addition Aguia also has a phosphate resource known as the Joca Tavares Project (JT). It is located 41km to the south east from our current TEPP phosphate project and is the second phosphate project where Aguia conducted systematic exploration work and identified an audited Mineral Resource which was announced to the market on 13th July 2016.
The Project has a JORC-compliant Measured and Indicated Resource of 2.75Mt grading at 4.37% P205.
ORGANIC TESTING & CERTIFICATION OF PAMPAFOS
Between 2011 and 2017, Aguia drilled about 3,000 metres at our project (TEPP), where we plan to build the phosphate mine. Consequently, we have many core rock samples from the TEPP research and reserve certification process.
The core was sampled on average at 1-m-intervals and sent to the laboratory for chemical analysis to determine its composition. The assays were largely done by ALS, a global leader in laboratory geochemistry that applies the most modern analytical methods. ALS assayed the samples to identify the composition of the ore, including testing for the presence of major elements, those present in per cent concentrations, and trace elements, those with concentrations in parts per million or billion.
The assays were then certified by ALS and by Aguia in accordance with the international standard Quality Assurance and Quality Controls (QAQC) protocols.
The assays determined that the core rock samples did not contain any element in concentrations that would be toxic, e.g., cadmium, radiometric elements, and others. That is to say, the testing determined that there was no harmful composition present in the rock.
The assays also determined that the product Pampafos contains a number of ingredients that are beneficial to agriculture and, consequently human health, including:
Aguia intends to apply for organic certification of the product Pampafos. This application, however, can only be made when the processing plant has been constructed, and the mine and the processing plant are in operation. The reason for this is that the authorities must be satisfied that no chemicals will be added to the product during processing.
Strictly speaking, Pampafós is inorganic because it comes from the weathering of a phosphate-bearing rock, and rock is inorganic. Aguia will mine the weathered material and then dry and crush it to achieve a commercial grain-size distribution. Nevertheless, Pampafos can and will be certified organic as no chemicals will be added to it, and it is be suitable for organic agriculture and home gardens.
THE AGRICULTURAL PHOSPHATE MARKET IN BRAZIL
The global demand for fertilisers is expected to grow by 60% over the next 30 years.
Brazil is an agricultural powerhouse providing food for about 217m people and is still able to export 49% of its agricultural produce.
We operate in the State of Rio Grande do Sul which is Brazil’s 3rd largest grain producing State. Last year it produced AUD $50 billion worth of grain which represents 40% of the States GDP. The State has 90,000sq kilometres of land under grass fed beef production.
Aguia’s organic phosphate customers is expected to include both grain and cattle farmers. The product is suitable in both conventional and regenerative agriculture.
Aguia owns all of the known reserves of phosphate in this State. Our phosphate mine will be the first in the State and to markets beyond. There is no phosphate being produced in our potential markets to the near south in Uruguay, Paraguay and Northern Argentina. 70% of all Brazil’s phosphate needs and 100% of the State’s phosphate needs are currently imported.
The company originally, and conservatively estimated sales of 10% of the market within a 300 km radius of the mine site- about 300,000 tonnes per annum. We believe that the market has subsequently expanded and now also encapsulates all of the State and countries to the south including Uruguay, Paraguay and Northern Argentina.
As the project has progressed, so has buyer interest. Aguia has engaged a sales team with 35 years experience in agricultural retail and distribution in the State of Rio Grande do Sul.
Scientific testing has determined Aguia’s phosphate to be organic and we will apply for formal international organic certification on completion of construction.
Organic phosphate does not destroy the micro organisms which live in the soil which are vital to the life and health of the soil.
Pampafos has been scientifically proven to be also highly soluble which is one reason why it has been so effective in agronomic testing. The other reason is that it also contains a variety of key naturally occurring macro and micro nutrients.
This natural form of phosphate is known as phosrock which is the base ingredient for the production of synthetic phosphate. Chemicals are added to phosrock to manufacture products such as the widely used ‘superphosphate’ which are essential for mass grain and food production.
Pampafos provides conventional farmers using chemical fertilisers with an opportunity to switch to organic farming over time without risking their financial security.
In order to compete with chemical fertilisers it was necessary for Aguia to prove the effectiveness of Pampafos against commonly used synthetic fertilisers. Independent agronomical testing has been undertaken for over 3 years now by Dr Felipe Carmona a leading academic agronomist with a strong local client base. The testing is ongoing. All results are reported to the ASX.
Agronomical testing is now entering its 4th year and the product has been demonstrated to be as effective or better than chemical fertilisers. It was tested against a range of the most widely used chemical fertilisers and on all major global grain crops.
There are 2 European companies who manufacture and sell chemical phosphate in the State. This involves importing phosrock from Morocco into the local Port near the capital and then undertaking costly chemical manufacture and distribution – at some distance from the market.
By comparison Aguia is producing its competitive product locally and comparatively cheaply in the centre of the market.