PhosCo Ltd reports significant progress at its Gasaat Phosphate Project in Tunisia, backed by a €1 million EBRD grant and promising drilling outcomes at KM and SAB deposits. The company is well positioned amid rising global phosphate demand and tightening supply.
- Gasaat hosts a substantial 146.4Mt JORC phosphate resource at 20.6% P2O5
- Maiden resource estimates underway for KM and SAB deposits with assays pending
- €1 million grant awarded by EBRD to optimise project ahead of feasibility study
- Phosphate now classified as a US critical mineral, boosting market demand outlook
- PhosCo secures option agreement with EBRD for potential $7.5 million investment
Strategic Progress at Gasaat
PhosCo Ltd (ASX, PHO) has marked a pivotal quarter advancing its Gasaat Phosphate Project in Tunisia, reinforcing its ambition to become a globally significant fertiliser producer. The project boasts a robust JORC-compliant resource of 146.4 million tonnes at an impressive 20.6% phosphate content (P2O5), underpinning a long-life, low-cost operation.
Recent drilling campaigns at the KM and SAB prospects have delivered consistently thick and high-grade phosphate intersections, with some intercepts exceeding 50 metres. While assay results are pending, preliminary measurements suggest grades comparable to earlier successful drill holes, supporting the potential for enhanced upfront project economics due to lower strip ratios and proximity to the planned processing plant.
Market Tailwinds from Critical Mineral Status
The phosphate market is undergoing a structural shift as phosphate rock has been added to the US Critical Minerals List, reflecting growing concerns over supply chain vulnerabilities and food security. This designation aligns with similar moves in Europe, the UK, and India, signalling increased governmental support and incentives for phosphate projects worldwide.
PhosCo is well positioned to capitalise on these dynamics, especially as China tightens export restrictions amid rising domestic demand and mine depletion. With global phosphate imports expected to surge, particularly in the US and China, Gasaat’s scale and competitive cost base could meet a significant portion of this growing demand.
EBRD Partnership and Funding Milestones
In a notable development, PhosCo secured a €1 million (A$1.8 million) grant from the European Bank for Reconstruction and Development (EBRD) to support technical work aimed at optimising the Gasaat project. This funding is earmarked for enhancing project economics, particularly through targeting low-strip ratio deposits that can accelerate early production phases.
Alongside the grant, PhosCo formalised an option agreement granting EBRD the right to invest up to A$7.5 million at 5 cents per share, contingent on the release of an updated Scoping Study incorporating new discoveries. This potential investment would significantly contribute to financing the upcoming Bankable Feasibility Study, a critical step toward project development.
Legal and Corporate Developments
PhosCo also reported a successful legal outcome enforcing an arbitral award against its former joint venture partner, Tunisian Mining Services SARL (TMS), related to a legacy project. While recovery of damages remains uncertain, the decision reinforces PhosCo’s control over its assets and clears the path for unencumbered development of the Gasaat project.
Financially, PhosCo ended the quarter with approximately A$2.3 million in cash and undrawn grant funds, maintaining a solid position to advance exploration and development activities. Managing Director Taz Aldaoud demonstrated confidence by exercising options to invest an additional $1.1 million into the company.
Looking Ahead
PhosCo is targeting completion of maiden resource estimates for the KM and SAB deposits in early 2026, feeding into an updated Scoping Study due in the second quarter. This will set the stage for commencing the Bankable Feasibility Study later in the year. The company is also exploring opportunities to optimise processing flowsheets and infrastructure logistics, including potential downstream fertiliser processing collaborations.
With phosphate’s critical mineral status and tightening global supply, Gasaat’s development trajectory positions PhosCo as a key player in securing future fertiliser supply chains.
Bottom Line?
PhosCo’s Gasaat project is gaining momentum amid favourable market shifts and strategic funding, but upcoming assay results and feasibility outcomes will be crucial to validate its global ambitions.
Questions in the middle?
- How will pending assay results from KM and SAB deposits impact the overall resource and project economics?
- What are the prospects and timelines for EBRD exercising its investment options following the updated Scoping Study?
- How might evolving phosphate export policies in China and other key markets influence Gasaat’s export strategy and pricing?