Site visit: Muga and SDP support; price target lifted (By GMP)

Site visit: Muga and SDP support >2Mtpa potash, price target lifted and cheap at current price Muga 1Q15 DFS should impress: ~1.1Mtpa The Muga 2Q14 PFS outlined 860ktpa potash for US$308m capex, but 2014 drilling lifted M&I resources 52% to 239Mt, leading to submission of a mining application for 800tph or ~1.1Mtpa potash. Lifting the run rate, increasing extraction to 80% with backfill and using the weaker euro lifts 1xNPV10% from US$538m to US$960m in our model, with GMPe capex of US$400m.

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