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Highlights
- 10-year lease secures access to a key fertiliser plant.
- Staggered payment plan funds necessary capital works.
- Production scheduled for Q3 2025 with expansion prospects.
Aguia Resources (ASX:AGR) has taken a significant stride in advancing its Brazilian phosphate strategy by finalising an agreement to utilise a local fertiliser plant. The binding 10-year lease—with an option to extend for an additional decade—provides the company with prompt access to a processing facility situated approximately 110 kilometres from its Três Estradas phosphate mine site in Brazil.
Under this arrangement, Aguia Resources will benefit from the existing infrastructure at the plant, which currently has the capacity to process around 100,000 tonnes of phosphate per annum. This facility now becomes a cornerstone in the company’s broader plan to ramp up production in a region that is traditionally dependent on costly phosphate imports.
To support the transition and necessary improvements, the agreement outlines a structured payment plan totalling $1.4 million. The plan is designed to cover both planned capital works and costs related to ceasing previous operations at the facility. Payments will be made in six staggered instalments: an initial $34,000 followed by two instalments of $154,000 at the end of March and April, two further instalments of $336,000 at the end of May and June, and a final payment of $386,000 at the close of July. This carefully phased approach aims to manage capital expenditure efficiently while ensuring that the plant is upgraded to meet Aguia Resources’ operational requirements.
In addition to the capital works, a monthly lease fee of $43,000 will commence on 1 August 2025. The facility is being prepared for production, with processing of Pampafos ore anticipated to begin in the third quarter of 2025. Concurrently, the company is fast-tracking evaluations of nearby deposits at Mato Grande and Passo Feio, located less than 3 km and approximately 8 km from the plant respectively. These efforts indicate a clear roadmap toward increased production capacity potentially as early as early 2026, contingent on market dynamics.
This strategic move comes at a time when the local phosphate market presents a compelling opportunity. With Rio Grande do Sul heavily reliant on imports priced at around $344 per tonne, the high-grade product processed at this facility is expected to be competitively priced between $150 and $160 per tonne. By securing this processing asset, Aguia Resources is well positioned to carve out a meaningful market presence in southern Brazil’s pre-eminent agricultural region, paving the way for sustained growth in the phosphate sector.
