5 July 2024

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

Q2 2024 Update

Emmerson, the Moroccan-focused potash development company, is pleased to provide an update on activities during Q2 2024 from its 100% owned Khemisset Potash Project ("Khemisset" or the "Project").

Highlights

·    Updated Environmental & Social Impact Assessment (''ESIA'') submitted, incorporating the optimisations from the Khemisset Multi-mineral Process ("KMP"). ESIA currently under review by the Commission Régionale Unifiée de l'Investissement ("CRUI")

·   Initial crop trials completed, successfully demonstrating the effectiveness of KMP products as sources of phosphate. Further trials are planned to confirm the benefits of the additional contained micro-nutrients magnesium and iron

·   Offtake Memorandum of Understanding ("MOU") signed for KMP products, in addition to existing MOUs for potash and salt

·    Patent application for KMP now submitted in Morocco as well as the UK

·    US$2.5 million raised from a placing at 1.75 pence in April 2024, including US$2.2 million from the Company's largest shareholders, and US$0.3 million from an oversubscribed retail offer

Chief Executive Graham Clarke said: "Following the positive news at the end of Q1 that our recourse application for the environmental approval had been upheld and would be referred back to the CRUI for reconsideration, we were delighted to update our ESIA to show the significant improvements brought about by the KMP optimisations in addition to the previous design optimisations. The overall environmental credentials of the Project are now even more robust, and, together with the compelling economics of the KMP update, should mean that we can obtain the necessary approvals and move forward with the Project swiftly.

"While we have been holding back from any major workstreams pending timing clarification of the ESIA approval process, we have nevertheless made some important steps forward on the new KMP products to be marketed.

"The crop trials, which were completed in June, confirmed the effectiveness of the new KMP fertiliser products as sources of phosphate and will be followed up with further trials looking at the benefits of the other micronutrients (magnesium and iron) they contain, as well as their slow-release properties. We have also signed MOUs for the offtake of a significant quantity of the new KMP products, confirming the marketability of these multi-nutrient fertilisers."

Environmental Approval

In March 2024, the Commission Ministérielle de Pilotage (The "Ministerial Committee") invited the Company to update its ESIA to incorporate the optimisations arising from the KMP process changes, which include a significant reduction in water consumption and the elimination of the need to dispose of waste brines, and to resubmit this for review by the CRUI.

In April 2024, the Company completed these updates and resubmitted what it hopes to be the last version of the ESIA.

The Company continues to pursue its engagement with the relevant authorities, and in view of the considerable improvements to the environmental footprint of the Project made not only through the KMP enhancements, but also other enhancements over the previous three years, the Company remains confident that the approval will be forthcoming.

Crop trials

In June 2024, the Company completed the first set of crop trials using two multi-nutrient fertilisers produced from the new KMP optimisations. The trials, which took place over a 10-week period with little gem lettuces in a glass-house test environment, assessed the suitability of struvite and vivianite products as sources of phosphate.

The results were positive as had been expected, as plants fed with both products performed in line with those given traditional phosphate sources, and considerably better than controls given no phosphate.

Further trials are planned to assess the additional benefits from the other nutrients contained by the KMP products (magnesium, iron and nitrogen), as well as the benefit of being slow-release, on various crops and for different soil types, with a view to increasing their market value.

Offtake for KMP products

In June 2024, the Company entered into a non-binding MOU with Hexagon Group AG ("Hexagon") for offtake of some of the new fertiliser products resulting from KMP.

Under the terms of the MOU, Hexagon would take up to 300,000 metric tonnes of struvite-based products and 50,000 tonnes per annum of vivianite-based products   

All other terms of the MOU are in line with the MOUs for potash and salt announced in November 2022, including "take or pay" provisions, and will be delivered Free On Board ("FOB") at Casablanca, Jorf Lasfar, or Safi (unless otherwise mutually agreed).

This MOU is also non-exclusive, meaning the Company can continue to engage in ongoing offtake discussions with other wholesale customers, distributors, and global traders for production from Khemisset for all of its products.

Other

Following the submission of a patent application for the new KMP processes in the UK in September 2023, the Company also submitted an application in Morocco during Q2 2024. These patent applications, which will be extended more widely once approved, give important commercial protections over the intellectual property relating to this valuable innovation.

Equity placing

In April, the Company announced the completion of an equity placing which raised US$2.5 million in gross proceeds at a price of 1.75 pence per share (the "Placing Price").

The bulk of this placing was with Global Sustainable Minerals Pte Ltd ("GSM") and Gold Quay Capital Pte Ltd ("GQC") (together the "Strategic Investors"), whereby GSM subscribed for US$2.0 million and GQC for US$175k of new shares, at the Placing Price. As a result of this placing, GSM received 90,702,948 shares and GQC received 7,936,508, taking their holdings to 20.30% and 2.64% respectively.

The Strategic Investors also received a warrant to subscribe for new Shares ("Warrants") for each new share received in this placing,  at an exercise price of 3 pence and an expiry date of 31 December 2024.

In addition, the Company completed an oversubscribed retail offering on the REX platform, raising a further US$0.3 million (£240k) at the Placing Price.

The funds are to be used by the Company to advance its studies in respect of KMP towards feasibility level alongside the progression of the EIA process in Morocco, as well as for general working capital requirements.

Outlook

The key priority over Q3 remains obtaining environmental approval for the Project. At the same time, the Company is continuing with low cost/high value testwork related to KMP including crop trials, technical workshops, and production optimisations both in Morocco and the UK.

**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. Updated financial estimates published in February 2024 indicated a net present value of US$2.2 billion, with an internal rate of return of approximately 40%.