MBAC Fertilizer Corp. has entered into an agreement with IFC, a member of the World Bank Group, pursuant to which IFC has agreed to invest approximately C$33.6 million to acquire 10,829,900 common shares of MBAC at a price of C$3.10/share.
Upon completion of the IFC placement, IFC will hold an interest representing approximately 11.1% on a non-diluted basis and 10.3% on a fully-diluted basis of the common shares outstanding. The proceeds from the IFC investment will be used by MBAC for the development of the Itafós-Arraias SSP project.
In October 2008, MBAC Fertilizer purchased 100% of the shares of Itafós Mineração Ltda, located in central Brazil, near the border of Goiás and Tocantins states. The company operates a small-scale mine and processing facility which has a production capacity of approximately 100,000 mt/y. The current operation processes rock phosphate which is sold to local farmers for direct application.
MBAC is focused on development of a higher volume and much larger mining operation, which is expected to be in place by mid-2012. The Itafós Arraias SSP pro-
ject will include a new mine and mill facility, a sulphuric acid plant, an SSP plant and a granulation plant. At full capacity, the proposed beneficiation plant is expected to generate 330,000 mt/y of phosphate rock concentrate at 28% P2O5. This phosphate concentrate will be used to produce 500,000 mt/y of SSP. Beyond this proposed first phase of development, the company said it is also actively investigating the potential for a second phase of development which could double production and potentially be in place as early as 2015.