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PLYMOUTH, Minn., May 2, 2011 /PRNewswire/ -- The Mosaic Company (NYSE: MOS) announced today that it has notified Potash Corporation of Saskatchewan Inc. ("PCS") that Mosaic has satisfied its obligation to produce potash for PCS from its mine in Esterhazy, Saskatchewan.
Mosaic has been providing PCS with potash from the Esterhazy mine at cost for forty years under a tolling agreement. Over the life of the agreement, PCS has requested and received substantially more potash than has been mined from PCS's reserves. Mosaic has supplied the excess from its own reserves. In recent years, PCS has elected to receive approximately one million tonnes per year.
Based on Mosaic's calculations, the amount of potash mined for PCS from Mosaic's reserves is now equal to the amount expected to be mined from the remaining PCS reserves. As a result, Mosaic believes that it has no further obligation to deliver potash to PCS from the Esterhazy mine, other than PCS's remaining inventory.
Mosaic has conducted a thorough analysis to estimate the amount of remaining PCS reserves. This analysis relies on Mosaic's 50 years of Esterhazy mining experience and was developed using the latest and most scientifically advanced technologies, including 3D seismic imaging.
Mosaic and PCS are currently in litigation concerning their respective rights and obligations at the Esterhazy mine, including the amount of potash Mosaic is required to deliver to PCS. Mosaic has offered to continue to ship additional product to PCS at market-based prices during the next 60 days, and Mosaic has also offered other alternatives to allow continued potash shipments to PCS until the conclusion of trial, currently scheduled to begin in January 2012. Should PCS not pursue any alternative, Mosaic intends to cease additional potash shipments on July 1, 2011.
About The Mosaic Company
The Mosaic Company is one of the world's leading producers and marketers of concentrated phosphate and potash crop nutrients. Mosaic is a single source provider of phosphate and potash fertilizers and feed ingredients for the global agriculture industry. More information on the company is available website
Safe Harbor Statement
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements include, but are not limited to, statements about future strategic plans and other statements about future financial and operating results. Such statements are based upon the current beliefs and expectations of The Mosaic Company's management and are subject to significant risks and uncertainties. These risks and uncertainties include but are not limited to risks and uncertainties arising from the predictability and volatility of, and customer expectations about, agriculture, fertilizer, raw material, energy and transportation markets that are subject to competitive and other pressures and economic and credit market conditions; the level of inventories in the distribution channels for crop nutrients; changes in foreign currency and exchange rates; international trade risks; changes in government policy; changes in environmental and other governmental regulation, including greenhouse gas regulation and implementation of the U.S. Environmental Protection Agency's numeric water quality standards for the discharge of nutrients into Florida lakes and streams; further developments in the lawsuit involving the federal wetlands permit for the extension of the Company's South Fort Meade, Florida, mine into Hardee County, including settlement, orders, rulings, injunctions or other actions by the court, the plaintiffs, the Army Corps of Engineers or others in relation to the lawsuit, or any actions the Company may identify and implement in an effort to mitigate the effects of the lawsuit; other difficulties or delays in receiving, or increased costs of, or revocation of, necessary governmental permits or approvals; further developments in the lawsuit involving the tolling agreement at the Company's Esterhazy, Saskatchewan, potash mine, including settlement or orders, rulings, injunctions or other actions by the court, the plaintiff or others in relation to the lawsuit; the effectiveness of the Company's processes for managing its strategic priorities; adverse weather conditions affecting operations in Central Florida or the Gulf Coast of the United States, including potential hurricanes or excess rainfall; actual costs of various items differing from management's current estimates, including, among others, asset retirement, environmental remediation, reclamation or other environmental obligations, or Canadian resource taxes and royalties; accidents and other disruptions involving Mosaic's operations, including brine inflows at its Esterhazy, Saskatchewan, potash mine and other potential mine fires, floods, explosions, seismic events or releases of hazardous or volatile chemicals; and other risks and uncertainties reported from time to time in The Mosaic Company's reports filed with the Securities and Exchange Commission. Actual results may differ from those set forth in the forward-looking statements.
SOURCE The Mosaic Company
For further information: Media, Rob Litt, +1-763-577-6187, or Investors, Laura Gagnon, +1-763-577-8213, both of The Mosaic Company
