China's Capital Raises the Largest Potash Project in Africa

The largest potash fertilizer base project in Africa, which is mainly participated by China’s capital, has officially started operations in Congo (Brazzaville). The project is located in Mengge Village, Pointe-Noire, Congo (Brook), southwestern port city, with a total investment of more than US$1.3 billion. It is invested by China Spring Holdings Group’s listed company, Canada McGill Mining Co., Ltd. The actual developer is Meg Mine Potash Congo Congo Co., Ltd. (MPC). On July 10, the A-share listed company Donghua Technology announced in the evening that the company and Canadian MagIndustriesCorp. And its MagMinderalsPotassesCongoS, a holding company in the Republic of the Congo. A. (Also called "MAG company") signed a general contract for the construction of a 1200kt/a potash fertilizer project in Congo (Brazzaville) in Beijing, with a product size of 1200 kt/a potassium chloride, including brine extraction and processing plant area The engineering, granulation and packaging projects, thermal power plant projects, office and living area projects, off-site engineering and port engineering are counted as 38 items or systems.

Wang Fuliang, deputy general manager of MPC, told reporters that as the largest potash fertilizer project in Africa and China’s largest industrial production investment project, Mengge potash project was supported by the governments of China and Congo (Brazzaville), including rigid income tax and import Tariff preferential policies. This project will also create nearly 1,000 direct jobs for the local people, which will help promote the diversified development of the Congo (Brazzaville) economy.

The Congo (Brazzaville) Minister of Mines and Geology, Pierre Oba, said at the ceremony that the Mungo Potash Project is one of the major industrial projects in Congo (Brazzaville) and Central Africa, which will increase the employment rate of young people and increase the number of local residents. income.

As the general contractor of the project, as early as March 16 of this year, Donghua Technology and MAG Corporation signed an engineering general contracting directive on the project, and received an advance of US$8.03 million in accordance with the indicative clauses. Preparation for the project construction. The construction period of the project will be from March 10, 2013 to March 31, 2016 (ie, the performance assessment will be passed). The price of the general contract is divided into fixed part and non-fixed part; the price of the fixed part of the main contract of the project part is determined to be 4.79931 billion U.S. dollars, and the fixed price will increase with the subsequent determination of individual new assumptions; Part of the price is 0.24462 billion U.S. dollars, as a reward and punishment for the completion of the contractor's quality and quantity on time.

The total contract price was USD 521,853 million, equivalent to RMB 3,200 million. The performance deadline was about 36 months. The average annual contract price accounted for 34.97% of the company's 2012 audited operating revenue. The smooth performance of the general contract will have a certain impact on the company's 2013-2016 operating income.

A survey by the reporter found that similar Canadian partners, similar potash projects, and A-share listed company Zhongcheng shares had encountered three years ago. On February 1, 2010, Zhongcheng Co., Ltd. issued an announcement announcing the signing of the "Development Framework for Mongolian Potash Fertilizer Project in the Republic of Congo" with MAG Co., Ltd. Zhongcheng Co., Ltd. and MAG Corp. plan to develop potassium in the permit area of ​​the Republic of the Congo. For the mineral project, a potash fertilizer plant with an annual output of 1.2 million tons will be built to produce granular or standard potash fertilizer. The project is expected to not exceed 1.2 billion U.S. dollars. However, a paper announcement on December 22, 2010 by Zhongcheng Co., Ltd. announced that the project has been completely undermined. According to the announcement, MAG issued an announcement in Canada on December 21, 2010, local time, and TSC has signed a letter of intent regarding the acquisition of MAG shares by TSC. MAG has granted TSC exclusive rights, including requirements, in the letter of intent. MAG suspends any negotiations with any third party regarding the content of the letter of intent. After the news was announced, Zhongcheng Co., Ltd. fell at the same day.

However, two years later, MAG also climbed another A-share listed company, Donghua Technology, in the Congo Potash project. In addition, the amount of this project exceeds the previous US$1.2 billion of China Chengcheng’s shares. For Chinese companies, this transaction is an “overpriced” overseas big order. At that time, Donghua Technology was very cautious, emphasizing that "this indicative term is an informal general contract, with significant uncertainty."

According to the plan, the project will be officially put into operation at the end of 2015, with an annual output of 1.2 million tons of potash fertilizer, and the annual sales revenue is expected to exceed US$500 million.