DAN:CC - Reliance On Small Number Of Countries A Key Risk Driver For Phosphate Supply – Arianne Phosphate’s Lac à Paul Project Could Be The Answer
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By Meg Flippin, Benzinga
From fertilizer to growcrops to electric batteries to power next-generation vehicles, demandfor phosphate is growing. At the same time, supply is increasinglydisrupted. As it stands, most of the world has a deficit of thisimportant rock, with North America, South America, Western Europe andmuch of Asia forced to import phosphate. North America alone isrunning at an annual deficit of about four million tons, and accordingto a 2022assessment by the EPA “trade disputes, and reliance on asmall number of countries for imports have led to limited supply anddramatically increased price of phosphate rock.”
That poses a potentialrisk to the world’s food supply, with agricultureproduction poised to grow 60% by 2050 . And with the world showingindications of moving toward Lithium-Iron-Phosphate (LFP)batteries to power EVs and store wind and solar energy, the need forphosphate will likely only grow. The global phosphate market is projectedto reach $16.8 billion in 2023 and hit $21.4 billion by2033.
Currently, 85% of all minesproducing phosphate are owned by fertilizer companies yet even withthis, many companies are not self-reliant, including North America’slargest, Mosaic Co. (NYSE: MOS), and are forced to import rock.That carries its own risks. Much of the phosphate rock supply is foundin the Middle East and North Africa or MENA region, which is facingpolitical unrest and economic instability. That makes getting it fromoutside sources costly and unreliable. It is also why AriannePhosphate Inc.’s (OTCMKTS: DRRSF) Lac à Paul Phosphate projectholds promise.
Big And Independent
Lac à Paul is home tothe world’s largest greenfield phosphate phosphate deposit and islocated in mining-friendly, geopolitically-safe Québec, Canada. Thegeology of the project is also rare as it is igneous, as opposed tosedimentary. This geology allows the company to produce a high-qualityphosphate concentrate with little-to-no contaminants. The nature ofthis phosphate also allows for easier and more environmentallyfriendly production of phosphate-based products. Higher purity isimportant, particularly in the European Union, which, as of 2017 haslegislation on the books that limits the level of cadmium allowed in phosphate imported intothe EU. That’s driving more demand for high-purity phosphate such asArianne’s.
Arianne Phosphatereports that Lacà Paul Phosphate is also the only independent large-scaledevelopment project coming on-stream in the next few years, whichindicates its potential to become a big supplier as aresult.
Not Just Fertilizer
Although phosphate is mostly understood as an agriculturalcommodity, today it’s not just for fertilizer. There are severalmarkets Arianne’s mine can serve and, again, due to its raregeological formation, it is ideally suited for all of them. One suchmarket is the lithium-iron-phosphate (“LFP”) battery. The LFP isexpected to be a major driver of demand for phosphate and its marketis expected to exceed$50 billion by the end of the decade. Wood Mackenzie predictslithium iron phosphate will become the leadingbattery chemistry for EVs by 2028 . Arianne’s phosphate hasalready been shown to be ideal for this application.
Location,Location, Location
Location is everything, and the Lac à Paul Phosphate projectis positioned strategically. It is located in a mining andinvestment-friendly jurisdiction with a well-developed infrastructurethat includes clean energy, heavy haul roads, easy access to ports andskilled labor. The mine has received all its major permits to commenceconstruction, has a social license to operate and has a long-standingcommitment to environmental best practices. It will also be a boon tothe local economy. Arianne expects the project will create 1,000jobs during operation and contribute over $12 billion ineconomic benefits to the region. With a life span of more than 26years, Lac à Paul Phosphate could bring economic vitality to the areafor many years to come.
Phosphate isan important ingredient in everything from fertilizer to electricvehicles, but importing it is becoming more difficult. Arianne wantsto change that with its Lac à Paul Phosphate project, providing astable and secure supply of this very important rock to companies bigand small and expanding North America’s share of global production.
ARIANNE PHOSPHATE INC. ( www.arianne-inc.com )owns the Lac à Paul phosphate deposit in Quebec, Canada. Fullypermitted and shovel ready, the asset is among the world’s largestgreenfield deposits, capable of producing an environmentally friendlyphosphate concentrate. Due to the nature of its high-purity,low-contaminant product, Arianne’s phosphate can be used to producefertilizer as well as meeting the technical requirements of specialtyapplications such as the lithium-iron-phosphate (LFP) battery. The Lacà Paul deposit is rare due to its geographic location and geologicalstructure. Arianne Phosphate is listed on both the TSX-V: DAN and the OTCQX: DRRSF .
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Thisinformation contains forward looking statements. All statements, otherthan statements of historical fact, included herein, including withoutlimitation, statements regarding potential mineralisation andreserves, exploration results and future plans and objectives ofArianne Phosphate Inc, are forward-looking statements that involvevarious risks and uncertainties. There can be no assurance that suchstatements will prove to be accurate and actual results and futureevents could differ materially from those anticipated in suchstatements. Important factors that could cause actual results todiffer materially from Arianne Phosphate Inc’s (“AriannePhosphate” or the “Company”) expectations are disclosed underthe heading "Risk Factors" and elsewhere in Arianne PhosphateInc’s documents filed from time-to-time with the TSX Venture andother regulatory authorities.
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