Profile: Potash Corporation of Saskatchewan Inc (POT.TO)

POT.TO on Toronto Stock Exchange

41.49CAD
19 Dec 2014
Price Change (% chg)

$0.58 (+1.42%)
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$40.91
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Potash Corporation of Saskatchewan Inc. (PCS), incorporated on May 15, 2002, is an integrated fertilizer and related industrial and feed products company. The Company operates in three segments: potash, phosphate and nitrogen. The Company owns and operates five potash mines in Saskatchewan and one in New Brunswick. Its phosphate operations include the manufacture and sale of solid and liquid phosphate fertilizers, phosphate feed and industrial acid, which is used in food products and industrial processes. The Company also has a phosphate mine and two mineral processing plant complexes in northern Florida and five phosphates feed plants in the United States. It produces phosphoric acid at its Geismar, Louisiana facility. The nitrogen operations involve the production of nitrogen fertilizers and nitrogen feed and industrial products, including ammonia, urea, nitrogen solutions, ammonium nitrate and nitric acid. It has nitrogen facilities in Georgia, Louisiana, Ohio and Trinidad.

Potash Operations

The Company’s potash operations include the mining and production of potash, which is used as fertilizer. All potash produced by the Company in Saskatchewan is in the southern half of the Province, where potash deposits, or Members, are found. The potash ore is contained in a predominantly rock salt formation known as the Prairie Evaporite, which lies about 1,000 meters below the surface. The evaporite deposits, which are bounded by limestone formations, contain the potash beds of approximately 2.4 to 5.1 meters of thickness. Three potash deposits of economic importance occur in the Province: the Esterhazy, Belle Plaine and Patience Lake Members. The Patience Lake Member is mined at the Lanigan, Allan, Patience Lake and Cory mines, and the Esterhazy Member is mined at the Rocanville and Esterhazy mines.

In 2012, its conventional potash operations (excluding Esterhazy) mined 20.999 million tons of ore at an average mineral grade of 22.88% potassium oxide (K2O). In 2012, its potash production from all its operations (including Esterhazy) consisted of 7.724 million tons of potash (KCl or finished product) with an average grade of 61.05% K2O, representing 47% of North American production. In 2012, its capacity represented an estimated 52% of the North American total capacity. The Company allocates production among its mines on the basis of various factors, including cost efficiency and the grades of product that can be produced.

Phosphate Operations

The Company’s mine phosphate ore and manufacture phosphoric acid, solid and liquid fertilizers, animal feed supplements, purified phosphoric acid which is used in food products and industrial processes, hydrofluosilicic acid (HFSA) and silicon tetrafluoride (STF). The Company conducts its phosphate operations primarily at two facilities, one a 75,127-acre facility near Aurora, North Carolina and the other a 99,588-acre facility near White Springs in northern Florida. The Aurora facility includes a 6.0 million ton per-year mining operation, three sulfuric acid plants, four phosphoric acid plants, four purified acid plants, a liquid fertilizer plant, four superphosphoric acid (SPA) plants, a defluorinated phosphate (DFP) or animal feed plant, two granulation plants capable of producing diammonium phosphate (DAP) or monoammonium phosphate (MAP) and four STF plants.

The White Springs facility is the phosphoric acid producer, by capacity, in the United States. The White Springs facility includes a mine and two production facilities, Suwannee River and Swift Creek, with two sulfuric acid plants, one phosphoric acid plant, two MAP plants, a SPA plant, a dicalcium phosphate plant and a DFP plant located at the Suwannee River complex and two sulfuric acid plants and a SPA plant located at the Swift Creek complex. At its Geismar, Louisiana facility, the Company manufacture phosphoric acid. The Geismar facility has a sulfuric acid plant, a phosphoric acid plant and a liquid fertilizer plant. A portion of the phosphoric acid produced at the Geismar facility is sold as feedstock to Innophos, Inc. for use in its neighboring purified acid plant. Its other phosphate properties include: animal feed plants in Marseilles, Illinois; Weeping Water, Nebraska; and Joplin, Missouri; technical and food grade phosphate plant in Cincinnati, Ohio; anda terminal facility at Morehead City, North Carolina.

During 2012, the Aurora facility’s total production of phosphate rock was 4.1 million tons and the White Springs facility’s total production of phosphate rock was 2.7 million tons. The Company’s phosphate operations purchase all of their ammonia at market rates from or through its nitrogen and sales subsidiaries. Phosphoric acid is reacted with ammonia to produce DAP and MAP as well as liquid fertilizers. In addition, ammonia operations include the purchase, sale and terminalling of anhydrous ammonia and much of this ammonia is purchased from third parties. Ammonia to White Springs is supplied through an ammonia tank lease in Tampa, Florida. Ammonia to Aurora is supplied through rail deliveries from its Lima, Ohio production facility and its Geismar, Louisiana storage facility.

The Company produces MGA at its Aurora, White Springs and Geismar facilities. Some MGA is sold to foreign and domestic fertilizer producers and industrial customers. The Company further process the balance of the MGA to make solid fertilizer (DAP and MAP); liquid fertilizers; animal feed supplements for the poultry and livestock markets; and purified phosphoric acid for use in a variety of food, technical and industrial applications.

Nitrogen Operations

The Company’s nitrogen operations include production of nitrogen fertilizers and nitrogen chemicals. These products are used for agricultural, industrial and animal nutrition purposes. The Company has four nitrogen production facilities, of which three are located in the United States and one is located in Trinidad. Nitrogen is taken from the air and reacted with a hydrogen source, usually natural gas reformed with steam, to produce ammonia. The ammonia is used to produce a full line of upgraded nitrogen products, including urea, nitrogen solutions, ammonium nitrate and nitric acid. Ammonia, urea and nitrogen solutions are sold as fertilizers to agricultural customers and to industrial customers for various applications. Nitric acid and ammonium nitrate are sold to industrial customers for various applications. Urea is also sold for animal feed applications.

The Company competes with The Mosaic Company, Agrium Inc., Intrepid Potash, Belarusian Potash Company (BPC), Israel Chemicals Ltd. (ICL), K+S Group, Sociedad Quimica y Minera de Chile S.A. (SQM), CF Industries, Inc., Mississippi Phosphates Corporation, J.R. Simplot Company, Office Cherifien des Phosphates (OCP), Innophos Holdings, Inc. and Koch Industries, Inc.

Company Address

Potash Corporation of Saskatchewan Inc

Suite 500, 122 - 1st Avenue Sout
SASKATOON   SK   S7K 7G3
P: +1306.9338500
F: +1306.9338877

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