- 1. INVESTOR PRESENTATION FEBRUARY 2014 TSX: MBC; OTCQX:MBCFF
WWW.MBACFERT.COM
2. MBAC FERTILIZER CORP. SAFE HARBOUR Disclaimer: The contents
are not to be reproduced or distributed to any third party,
including the public or press. The information contained herein,
while obtained from sources which we believe are reliable, is not
guaranteed as to its accuracy or completeness. The company is a
development stage mineral resource exploration company and many of
its mineral projects have yet to be proven to be economic. Certain
information set out herein in relation to the Companys advanced
projects is based on technical reports that are in compliance with
NI 43-101 that are not yet final. The reader is cautioned that such
information is subject to change, although management does not
anticipate any material deviations. The contents of this
presentation is for informational purposes only and does not
constitute an offer to sell or a or a solicitation to purchase any
securities referred to herein Forward looking statements This
presentation includes certain forward-looking statements about
future events and/or financial results which are forward looking in
nature and subject to risks and uncertainties. Forward-looking
statements include without limitation, statements regarding the
companys plans, goals or objectives and future completion of mine
feasibility studies, mine development programs, capital and
operating costs, production, potential mineralization, resources
and reserves, exploration results and future plans and objectives
of MBAC. Forward-looking statements can generally be identified by
the use of forward-looking terminology such as "may," will,"
"expect," "intend," "estimate," "anticipate," "believe," or
"continue" or the negative thereof or variations thereon or similar
terminology. There can be no assurance that such statements will
prove to be accurate and actual results and future events could
differ materially from those anticipated in such statements.
Important factors that could cause actual results to differ
materially from expectations include risks associated with mining
generally and pre-development stage projects in particular.
Potential investors should conduct their own investigations as to
the suitability of investing in securities of MBAC Fertilizer Corp.
2 3. MBAC FERTILIZER CORP. INVEST IN MBAC 3 To be a significant
integrated producer of phosphate fertilizers and related products
in the Brazilian and Latin American markets Our Focus Optimize
operations Leverage Brazils agriculture sector Organic growth
opportunities 4. MBAC FERTILIZER CORP. Itafs Project development
Santana Pre-feasibility Study Arax Prelim. Economic Assessment
FOCUSED ON VALUE CREATION 4 2012 YEAR OF TRANSITION Itafs
Construction completed Itafs First SSP deliveries Santana
Definitive Feasibility Study Itafs 1st full year of commercial
production Advancement of Santana Refinance Balance Sheet debt 2012
Year of progress 2013 Year of transition 2014 Year of value
realization 2015+ Period of growth Itafs Ongoing production Santana
Production launched Integrated, multi-mine producer 5. MBAC
FERTILIZER CORP. MBAC OVERVIEW 5 SANTANA PHOSPHATE High grade
phosphate deposit strategically located near the border of Para and
Mato Grosso states. Meeting animal feed phosphate and fertilizer
demand in the Center-West Brazil. DFS completed BRAZIL ITAFS
OPERATIONS PHOSPHATE Itafs Arraias SSP Operations - MBACs first
phosphate operation located in the centre of Brazils largest
agricultural region that will provide near-term cash flow Excellent
logistical advantage. ARAX PHOSPHATE /REE/Nb High grade Phosphate
and Rare Earth Elements/Niobium deposit. PEA completed So Paulo Rio
de Janeiro PA MA PI BA GO MT TO AM MG SP Brasilia NEW AGRICULTURE
FRONTIER MBAC is currently operating its Itafs phosphate operations
and has two growth projects in various stages of development 6.
MBAC FERTILIZER CORP. Peter Marrone * Chairman and Founder
Cristiano Melcher President, CEO and Director Antenor Silva Founder
and Director Denis Arsenault, CA Director Alexander Davidson *
Director Brian Hayward Director David Nierenberg * Director Hon.
David Peterson Director Leonardo Marques da Silva Director Carlos
Braga VP, Technical Services Rodrigo Pinto, CA VP, Finance and CFO
Steve Burleton VP, Corporate Development BMO Capital Markets Joel
Jackson Canaccord Genuity Keith Carpenter GMP Securities Anoop
Prihar National Bank Financial Greg Colman Paradigm Capital Spencer
Churchill Raymond James Steve Hansen CORPORATE OVERVIEW 6 Directors
& Management Research Coverage Current Capital Structure
Symbol/Exchange TSX: MBC Management & Directors ~20% Current
Share Price $1.12 52 wk High/Low $3.43-$0.90 Market Capitalization
($ millions) $170.3 170.32M * Member of the Executive Committee
Basic Shares 152.03M Options 12.21M Warrants 6.08M Basic Shares
Options Warrants 0.8 1.2 1.6 2.0 2.4 2.8 3.2 3.6 $/Share Stock
Chart 52 Week (MBC.TO) 7. MBAC FERTILIZER CORP. FROM PURCHASE TO
PRODUCTION 7 Beginning of Construction October 2011 Purchase of
Itafs RNP Operations October 2008 Resource estimate & PFS March
2010 Beginning of Operations August 2013 In less than 5 years 8.
MBAC FERTILIZER CORP. STRONG FUNDAMENTALS 8 Global food production
must increase 50% by 2030 according to UN Brazil is fast becoming
the bread basket to the world Agribusiness sector continues to be
major driver of Brazilian economy Brazil is 4th largest in
Agribusiness exports globally Grain prices remain at high levels
relative to historical prices Key driver of fertilizer prices
Cropping land area in Brazil has increased 3.2% per annum over the
past 12 years Source: ANDA; Ministry of Agriculture; MBAC team
analysis * Yearly average values used in calculating growth for
last 12 years 0 100 200 300 400 500 600 700 90 91 92 93 94 95 96 97
98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 US$/MetricTonne
Historical Soybeans & Maize Prices Soybeans Maize (corn) 9.
MBAC FERTILIZER CORP. Fertilizer demand in Brazil continues to grow
at a faster pace than developed countries Consumption has grown at
CAGR 5.5% from 20 to 31 million tonnes between 2005 and 2013
Imports supply ~70% of the demand New Agricultural Frontier
(MaPiToBa) continues to lead the growth in agriculture in Brazil
Fertilizer consumption grew between 2005 and 2012 at CAGR of 10.4%
Transportation costs continue to rise in Brazil Due to decreased
fuel subsidies and increased regulations Strengthens logistic
advantage for our projects STRONG FUNDAMENTALS 9Source: ANDA;
Ministry of Agriculture; MBAC team analysis 0.00 0.50 1.00 1.50
2.00 2.50 3.00 3.50 2005 2006 2007 2008 2009 2010 2011
2012MillionTonnes Fertilizer Delivered to Customers in MaPiToBa
Region 0 5 10 15 20 25 30 35 2005 2006 2007 2008 2009 2010 2011
2012 2013 MillionTonnes Fertilizer Delivered to Customers in Brazil
10. MBAC FERTILIZER CORP. LOGISTICS PROVIDES COST ADVANTAGE
10Source: ANDA; Ministry of Agriculture; MBAC team analysis SSP
TARGET MARKET OVERVIEW (BRAZIL) Itaqu Port Fortaleza Port GO
Paranagu Port (Main fertilizer Port in BR) Santos Port Scale: in
Kilometeres 1000 PI PA MT TO AM MA Aratu PortMG BA Legend Other
Domestic Competitor Closest Competitor Domestic Supply Import
Supply Arax Project New Agriculture Frontier Both MBAC phosphate
operations and projects have a significant competitive advantage
resulting from logistics Closest competitor ( ) has to transport
its rock from over 1,000 km to its industrial site Other domestic
competitors are located at minimum of 700 km away Closest ports are
more than 1,000 km away Inland transportation costs of approx. 6 -
7 cents per tonne km expected to increase new regulations /
decreased fuel subsidies Araxa 2000 Santana Itafos 500 Km 1000 Km
750 Km 11. MBAC FERTILIZER CORP. PRICE TRENDS 11 Global phosphate
fertilizer prices starting to recover after 3 year bear market DAP
prices up 39% since lows in Nov 2013 TSP prices up 32% since lows
in Nov 2013 Source: Independent Fertilizer Sources TSP can be used
as a proxy for SSP price trends Forecasts show TSP prices
rebounding starting in 2014 Falling input prices to support margins
Company expects 2014 SSP prices to average $235 - $245 / tonne
Slightly below average price in 2013 300 310 320 330 340 350 360
370 380 390 400 2013 2014 E 2015 E 2016 E $/Tonne TSP Prices FOB
North Africa - 100 200 300 400 500 600 700 800 Jan-2010 Jan-2011
Jan-2012 Jan-2013 Jan-2014 $/Tonne FOB Morocco Historical Phosphate
Fertilizer and Phosphate Rock Trends DAP TSP 12. MBAC FERTILIZER
CORP. ITAFS ARRAIAS PHOSPHATE OPERATIONS 13. MBAC FERTILIZER CORP.
OPERATIONS UPDATE 13 World Class Scale 14. MBAC FERTILIZER CORP.
ITAFS MINE & OPERATIONS 14Note: (1) Conventional contact
process (2) KTPA Thousand Tonnes Per Annum Resource Estimate
(January 2012) : Measured & Indicated Resource Tonnes (Grade%)
75.8 M Tonnes (5.0% P2O5) Inferred Resource Tonnes (Grade%) 12.3 M
Tonnes (3.9% P2O5) Reserves (Proven & Probable) (March 2013)
64.8 M Tonnes (5.1% P2O5) Recovery Rate (Target) 51% Average
Beneficiated Rock Grade 28% Name Plate Capacity 500,000 TPA
Sustaining Capex $6 M/Year Sulphur Yard Sulphuric Acid Plant
Fertilizer Plant Beneficiation Plant Phosphate Yard 15. MBAC
FERTILIZER CORP. ITAFS SSP PRODUCTION 15 Acidulation Required: ~6
KTPA Annual Prod.: 500 KTPA Annual Prod.: 500 KTPA Mill Plant Mine
Beneficiation Sulphur Sulphuric Acid Annual Prod.: 3,000 KTPA Av.
Grade: 5.4% P2O5 Annual Prod.: 330 KTPA Av. Grade: 28% P2O5
Required: ~75 KTPA Annual Prod.: 220 KTPA (1) Sulphuric Acid Plant
Generated: 6 MW Energy Granulated SSP GSSP Annual Prod.: 500 KTPA
Granulation Ammonia Note: (1) Conventional contact process (2) KTPA
Thousand Tonnes Per Annum 16. MBAC FERTILIZER CORP. ITAFS CURRENT
STATUS 16 The operations have started Continue to refine the
production processes and optimize efficiency The mine is operating
according to plan Mined grade in Q3 was 6.7% which is a little
higher than the average grade Beneficiation plant has undergone
modest mechanical and process modifications Improved recoveries
experienced Expect to be able to meet 2014 demand within the region
The sulphuric acid plant and granulation plants are meeting
expectations 17. MBAC FERTILIZER CORP. ITAFS MARKET 17 MBAC is
focused on industrial sales (traders, blenders, distributors, large
farm co-ops) Focused on securing 2014 strategic sales agreements
Have signed a strategic sales agreement for 70 KTPA with a regional
blender Continuing to negotiate additional agreements Overview of
Customers Significant Potential Customers Yara, Heringer (2nd
largest blender in Brazil) and Fertilizantes Tocantins (largest
blender in TO State) Customer Locations In negotiation with
potential customers who have their blending plants and/or their
warehouses located close to the Itafs site ( ) 18. MBAC FERTILIZER
CORP. BALANCE SHEET 181818 Itafs capital spending completed Focus
remains on managing working capital position Additional working
capital facilities received Working capital raised through prepaid
sales Looking at monetizing receivables and tax credits Company now
exploring the restructuring of its debt Better position to
negotiate more beneficial terms as an operating company Better
align debt repayments and cash flows 19. MBAC FERTILIZER CORP.
DEVELOPMENT PROJECTS 20. MBAC FERTILIZER CORP. SANTANA PROJECT
OVERVIEW 20 Santana contains one of the highest grade phosphate
resources in Brazil Flexibility to produce higher value-added
products (TSP, MAP and DCP) Area is one of the largest agricultural
markets in Brazil Mato Grosso state is the largest fertilizer
consumer in Brazil The municipality of So Felix do Xingu (PA) has
the largest number of cattle in Brazil Plan View of The Mineralized
Domain 21. MBAC FERTILIZER CORP. SANTANA - DFS 21 Robust project -
NPV of US$396 million and IRR of 19.9% Lessons learned from Itafs
were incorporated into the Santana design and cost estimate A more
compact footprint - will reduce the use of materials; Design
improvements will also reduce the use of materials; Will get its
water supply directly from a river and will not require the a dam;
and The high grade of the deposit will allow for a smaller
beneficiation plant. EPCM contract will provide independent
oversight and reduce cost risk Santana Itafs Reserves Million
Tonnes 45.5 64.8 Grades % 12.9% 5.1% Mine Life Years 32 19
Production (SSP) Tonnes per year 500,000 500,000 Total Capex BRL
Million 1,211.8 (1) 750.7 Total Capex US$ Million 426 (1) 340 (2)
(1) Includes a contingency reserve of US$50 million (2) Converted
at 2.2 BRL/US$ 22. MBAC FERTILIZER CORP. NEXT STEPS - SANTANA 22
Executive Committee continues to carry out a detailed review of the
project Will undertake detailed engineering prior to giving its
formal approval of the project Minimize scope changes Provide
greater certainty on capex and opex Better evaluate funding options
Board will provide construction decision after detailed review
Discussions with lenders and financial institutions for project
financing will be finalized Company also in discussion with
interested partied regarding a sale of minority stake Company
intends to rely on financing options that are least dilutive to
shareholders 23. MBAC FERTILIZER CORP. ARAX PROJECT OVERVIEW 23 One
of the highest grade REO deposits in the world M&I of 6.3 Mt @
5.0% TREO and 1.02% Nb2O5 Advantaged location Area is surrounded by
two large operations: Vale fertilizer mine/plant CBMM Niobium
mine/plant Developed infrastructure PEA completed in October, 2012
Capex $406 million NPV $967 million IRR 30% CBMM MINE Arax Project
VALE Mine Arax, MG Project Location REE Deposit Itafos Santana 24.
MBAC FERTILIZER CORP. NEXT STEPS - ARAX 24 Phase 2 pilot plant
tests for bulk concentrate have been completed Have produced 200
kgs of 98% REO bulk concentrate Continued discussions with
potential off-take partners Will start Phase 3 pilot plant tests
for REO separation Q4 2013 The asset has been determined to be
non-core Company is reviewing options to sell all or part of the
asset 25. MBAC FERTILIZER CORP. PILOT PLANT 25 Homogenization
Milling and Classification Drying Process Filter Press REO Filter
Cake Solvent Extraction 26. MBAC FERTILIZER CORP. WWW.MBACFERT.COM
27. MBAC FERTILIZER CORP. APPENDICES
