Q4 Update

8 January 2024

Emmerson PLC ("Emmerson" or the "Company")

Q4 2023 Update

Emmerson, which is developing the world class Khemisset Potash Project in Morocco ("Khemisset" or the "Project"), is pleased to provide an update on activities during Q4 2023.

Highlights

·    Emmerson is still awaiting the session of the Commission Ministérielle de Pilotage (''Ministerial Committee'' or the ''Committee'') to obtain environmental approval

·   Bank mandates extended for a further 12 months with a syndicate of international and Moroccan banks, demonstrating the ongoing support for the Khemisset Project

·   Important process optimisation work on the Project under final review with a potential for significant environmental and economic upside

·     Other technical work reduced to a minimum

Environmental Approval

The next step with regards to obtaining approval for the Environmental & Social Impact Assessment (''ESIA'') for the Khemisset Project remains a meeting of the Ministerial Committee, chaired by the Moroccan Head of Government. This Committee was unable to meet during the second half of 2023. The Company understands that this was a result of a number of matters taking priority at governmental level, not least the co-ordination of relief efforts related to the earthquake in September 2023.

The Company continues to lobby to ensure this meeting takes place as soon as possible, and that its application will be considered favourably, while at all times respecting due protocols and procedures.

The Company has repeatedly been assured that the meeting will take place soon, and that no further significant issues remain. However, the timing of the meeting and its outcomes are not within the Company's control. Any substantive updates on the approval process will be reported without delay.

Bank Mandates

In December 2023, the Company announced the extension of the appointment of a syndicate of leading international and Moroccan banks as initial mandated lead arrangers ("MLAs") to co-ordinate and fund dual-tranche debt financing facilities for the development of the Project for a further 12 months until 31 December 2024.

The debt facility under discussion amounts to US$310 million, including an ECA-covered tranche of US$230 million supported by UK Export Finance, and a dual currency (US$ and Moroccan Dirham) commercial tranche of US$80 million.

The extension of the mandates demonstrates the ongoing support for the Khemisset Project by the syndicate.

Other Workstreams

The basic engineering workstreams for the Khemisset Project are now at the stage where only the final documents are expected. No further exploration or engineering work in respect of the basic design is being undertaken pending the ESIA approval.

Separately, the Company has continued to examine process design and optimisations with a specific focus on improving the Project's environmental footprint, which also offer considerable economic upside. Details of these enhancements are being finalised and will be announced in due course. 

Chief Executive Graham Clarke said: "The final quarter of 2023 has been frustrating in that we continue to await the session of the Ministerial Committee, which is the next step towards the approval of our environmental permit. Discussions with various parties and advisors have continued to be positive, offering understanding for our frustration while explaining that governmental attention has been focused on various other matters. We believe the matter will be dealt with soon, based on feedback, but we are unable to provide any confirmed dates as the matter is in the hands of the government.

"The extension of the bank mandates was a positive development, and a reminder of the fact that we continue to enjoy the support of international and Moroccan banks, the UK government (both through UK Export Finance and the work of the British Embassy in Rabat), and our largest shareholder Global Sustainable Minerals Pte Ltd.

"While we have been continuing with our lobbying activities, we have limited our technical activities appropriately in order to preserve the Company's cash for as long as possible, although some important work has been undertaken to examine opportunities for further optimising and enhancing the project economically and more importantly, environmentally.

"Once we have the ESIA approval, we will be in a position to move forward quickly with fundraising and technical work. We will of course provide updates as soon as we are able in all these matters.

"In the meantime, I am grateful to our shareholders for their continued support, particularly in the context of unforgiving market conditions."

**ENDS**

For further information, please visit www.emmersonplc.com, follow us on Twitter (@emmerson_plc), or contact:

Notes to Editors

Emmerson is focused on advancing the Khemisset project ("Khemisset" or the "Project") in Morocco into a low cost, high margin supplier of potash, and the first primary producer on the African continent. With an initial 19-year life of mine, the development of Khemisset is expected to deliver long-term investment and financial contributions to Morocco including the creation of permanent employment, taxation, and a plethora of ancillary benefits. As a UK-Moroccan partnership, the Company is committed to bringing in significant international investment over the life of the mine.

Morocco is widely recognised as one of the leading phosphate producers globally, ranking third in the world in terms of tonnes produced annually, and the development of this mine is set to consolidate its position as the most important fertiliser producer in Africa. The Project has a large JORC Resource Estimate (2012) of 537Mt @ 9.24% K2O, with significant exploration potential, and is perfectly located to support the expected growth of African fertiliser consumption whilst also being located on the doorstep of European markets. The need to feed the world's rapidly increasing population is driving demand for potash and Khemisset is well placed to benefit from the opportunities this presents. The Feasibility Study released in June 2020 indicated the Project has the potential to be among the lowest capital cost development stage potash projects in the world and also, as a result of its location, one of the highest margin projects. This delivered outstanding economics, including a post-tax NPV₈ of approximately US$1.4 billion using industry expert Argus' price forecasts.