Research Reports, Taylor Collison

Sierra del Perdón: Another Feather in the Cap (By Taylor Collison)

April 23, 2015

Key Points
• Highfield Resources Limited’s (“Highfield” or “the Company”) is a potash development company with four 100%-owned projects in the potash and halite producing Ebro Basin in northern Spain.
• The Company has released a scoping study on the Sierra del Perdón (“SdP”) Project, located ~10km from Pamplona.
• The SdP Project incorporates the areas adjacent to historic underground potash mines (Potasas de Navarra and Potasas de Subiza) which operated continuously from 1963–1996.
• The economics of SdP are underpinned by the same location, infrastructure and cost advantages as Highfield’s flagship Muga Project.
• SdP has the potential to increase total K60 muriate of potash production rates to ca. 1.672Mtpa by 2020. Additional revenue streams could potentially be generated via commercialisation of salt and magnesium chloride by-products.
• Equity component of SdP Capex could potentially be funded via cash flows from the Muga Project.
• Highfield’s potash project portfolio is strategic. The projects are 100% owned, situated in a brownfield potash producing basin and are located in a developed country. This makes the Company a standout in the ASX junior resource sector and provides its projects with sustainable competitive advantages relative to other proposed potash projects.
• Company is strongly supported by resource-focused EMR Capital and the broader investment community. This will make securing project funding much easier in what is otherwise a challenging sector.

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