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Arianne Phosphate Inc.


Founded in 1997 under the name Arianne Resources Inc. and listed on the Toronto Stock Exchange in 2003, Arianne Phosphate Inc. is a Canadian mineral exploration company now focused on developing its Lac Paul resource into a major phosphate rock mine. The company's management and board are comprised of professionals from the mining and fertilizer industries who have significant experience with North American and international markets.

The information provided below is from analysts, newsletters and other contributors. Please contact the company and visit its website before making an investment decision.

Expert Comments:

The Energy Report Interview with Ethan Park (8/26/14) "Arianne Phosphate Inc. has an asset in Quebec with a full feasibility study. It is an igneous deposit, and it is expected to produce a 30% phosphate concentrate at 3 Mmt per year for more than 25 years. . .the company's deposit is an igneous deposit, which means it is lower in grade compared to a sedimentary deposit. But, importantly, an igneous deposit benefits from a much higher concentrate rate than a sedimentary deposit. While igneous deposits only have grades of 58%, they can easily be concentrated up to 39%, which is much higher than what sedimentary deposits can be concentrated up to, generally 29.5%. While the igneous ore grade is lower, the ultimate product is the concentrate. The greater the grade of concentrate, the higher the price." More >

Brien Lundin, Gold Newsletter (Jefferson Financial) (8/7/14) "Arianne Phosphate Inc. took a big step toward proving a phosphate deposit capable of supporting a 50-year mine at Lac a Paul in Quebec. . .to the large Paul deposit (472 Mt of 6.90% P2O5), the company has added the South TraMan zone (146 Mt of 5.30% P2O5) and Traverse (17 Mt of 5.98% P2O5). . .Lac a Paul also hosts the Nicole zone (78 Mt of 5.34% P2O5) and another area that could host as much as 390 Mt ranging from 5.34% to 7.13% P2O5. . .Arianne recently closed on the first tranche of a private placement designed to raise CA$8M. . .to move Lac a Paul along the development curve."

The Mining Report Interview with John Chu (7/29/14) "My favorite North American phosphate project is Arianne Phosphate Inc. and its Lac Paul project in Quebec. We like its management, and we've been impressed with how far it has moved this project along. This is a large, igneous project. There are two types of phosphate deposits: sedimentary and igneous. Igneous is rarer but results in higher phosphate content, up to 40% or more. Sedimentary deposits typically result in phosphate content in the 2535% range. Higher content means higher purity and value. [Arianne announced July 16 a TraMan Inferred mineral resource estimate of 146 Mt at 5.3% P205.] It's good news, but the deposit was pretty big already. In other words, Arianne has firmed up its resources. North America has two or three existing phosphate rock mines expected to come to an end of their mine lives in the next 510 years. This gives confidence to potential phosphate fertilizer producers that they can source phosphate rock from a company like Arianne. The project probably will go into production by H2/18. The major hurdle is, once again, securing funding. With a capex of over $1B, the question is whether Arianne can raise this money by itself or whether it will seek a partner. . .Arianne will have rail access to a port. Quebec has always been helpful in this respect, so I don't expect infrastructure to be a problem. There are several potential partners. One is Agrium, whose Kapuskasing mine in Ontario closed earlier this year, forcing it to source its phosphate rock from Morocco. Mosaic would be another candidate, as some of its phosphate rock mines in Florida are expected to be shuttered in five years or so." More >

Henry Lazenby, Mining Weekly (7/18/14) "Arianne Phosphate Inc., which is developing the Lac Paul project in Quebec, reported that its 2014 drill program had enabled it to significantly lift its flagship projects compliant Inferred resources. . . the added resources at the South TraMan and the Traverse zones of 163 Mmt Inferred grading 5.37% phosphorus pentoxide (P2O5) , along with the 78 Mmt Inferred grading 5.34% P2O5 at the Nicole zone, and a potential mineral target of 260390 Mmt grading 5.34%7.13% P2O5 near the Paul zone, could be of significant benefit to the company's operations and deserve further investigation."

Charlotte McLeod, Resource Investing News (7/16/14) "Arianne Phosphate Inc. announced that it's added 146 Mmt at 5.3% P2O5 with a 3.5% P2O5 cutoff grade to the Inferred category at its Quebec-based Lac a Paul project's TraMan zone. . .the company has also identified a new Inferred resource of 17 Mmt at 5.98% P2O5 at a 3.5% cutoff grade at the Traverse zone, also at Lac a Paul."

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The Mining Report Interview with Michael Berry (6/17/14) "One company of interest to us is Arianne Phosphate Inc. Arianne has developed a very large and unique phosphate resource in Quebec. The economics here are very compelling and as the major phosphate producers begin to scour the globe to add additional resources, Arianne must be on their radar. The company is greatly derisked in a number of ways and has shown the ability to deliver extremely attractive economics." More >

Thibaut Lepouttre, Caesars Report (6/6/14) "Arianne Phosphate Inc. has released a maiden resource estimate on the Nicole zone of its phosphate project in Qubec. The company has added an additional 78 Mmt grading 5.34% P2O5 to its resources and is now aiming to expand this resource at the Nicole zone to anywhere between 260 Mmt and 390 Mmt. This could prove to be instrumental to increase the value of the Lac Paul project. . .as the mineralization at the Nicole zone is close to surface, adding the resource estimate to the mine plan might reduce the expected strip ratio and thus enhance the economics of the project."

Simon Rees, Mining Weekly (5/20/14) "Arianne Phosphate Inc. is one junior hoping to reap the rewards for its work over the last several years at its Lac Paul phosphate project. . .the scope is broad, and the scale extensive. . .in the short term, Arianne will soon be unveiling results from a recent drill campaign, while further drilling will continue over summer. . .another objective is to continue advancing the project's environmental status. Arianne submitted its environmental impact assessment last year to Quebec's Ministry of Sustainable Development, Environment, Wildlife and Parks and this is now in the review stage."

Chris Berry, Disruptive Discoveries Journal (5/16/14) "Arianne Phosphate Inc. announced a mineral resource estimate for the Nicole zone of the Lac Paul phosphate project and the addition of the Inferred resource should be beneficial to the company, as it can positively affect the already promising project economics. . .I continue to reiterate that this unique igneous deposit must already be on the radar of end users. . .the deposit is substantially de-risked on the back of a published, bankable feasibility study; coupled with a sound share structure, these are two facts that the market is currently overlooking."

Brien Lundin, Gold Newsletter (Jefferson Financial) (5/1/14) "Arianne Phosphate Inc. has divested two non-core assets to Virginia Mines Inc. . .the deal was valued at approximately $180K and will allow Arianne to focus its full attention on getting Lac Paul, its large, high-grade phosphate deposit, into production. . .I continue to like this company as a development-stage play on phosphate and the world's ever expanding need for more food."

The Energy Report Interview with Michael Berry (4/17/14) "There's an advanced phosphate developer in Quebec that I like called Arianne Phosphate Inc. It currently has an NI 43-101 feasibility study completed. Arianne has a very high-grade phosphate deposit at Lac Paul in Quebec. The feasibility study shows a 25-year mine life with annual production of 3 million tonnes of phosphate concentrate with a grade of 38.6% P2O5. There are many zones still to explore that will expand the resource. The feasibility study shows that after beneficiation, the resource will provide among the highest P2O5 grades in the world. I think the company is an attractive takeover target given its location in Quebec, the vertical integration of the phosphate market and the very strong economics of the project.

[Permitting] should be a very important catalyst. The stock went up to CA$1.69, and it's backed off to CA$1.15. I think it's way too cheap right now. I think it's a stock that you want to own now. It's a big resource of 590 Mt of 7.13% Measured and Indicated ore. I don't think it will have any major problems on the permitting side. The one area it's going to have to deal with is the capitalization of the project. It may require a capex of $1.21 billion. On the other hand, it certainly has a really strong following, with a very low estimated production cost of $93.70 per tonne. The average selling price will likely be around $200 per tonne. This is a wonderful margin. Furthermore, it's a commodity that is relatively scarce in North America." More >

The Investment Doctor, Seeking Alpha (3/17/14) "Arianne Phosphate Inc. owns the only advanced stage phosphate project in Canada. Canada and the U.S. are net importers of phosphate, so the company is in an excellent position. . .the mine life could easily be extended by at least another decade, emphasizing the long-term potential of this asset. . .I strongly believe 2014 will be a pivotal year for the company as it expects to finalize the final permitting steps and start to secure funding for the Lac Paul project."

Brian Ostroff, Windermere Capital (3/8/14) "There have been a lot of good reasons to own Arianne Phosphate Inc. . .the prospect to grow the asset, the high quality of the phosphate it produces, the location of the asset and the high-quality team associated with the company have culminated in a very positive feasibility study. . .the company's Lac Paul deposit along is worth roughly $2B and yet its stock currently trades at a $100M market cap. . .arguably, this is the best macro environment that Arianne has ever faced so, to use [an] agricultural saying: When the sun is shining. . ."

Brien Lundin, Gold Newsletter (Jefferson Financial) (3/1/14) "The ore type at Arianne Phosphate Inc.'s Lac a Paul project will, once processed, generate a phosphate concentrate significantly richer than the market standard. This fact, along with the project's very appealing economics, continues to make the company an attractive long-term play on the planet's ever-growing demand for food."

The Energy Report Interview with Bob Moriarty (2/13/14) "Arianne Phosphate Inc. in Canada has the largest, undeveloped phosphate project in the world. Its market cap is 5% of NPV. In this space, takeovers are generally done at 3550% of NPV. This is a stock that could go up seven to tenfold, based on today's prices." More >

Chris Berry, Disruptive Discoveries Journal (1/31/14) "The overwhelming investment proposition for Arianne Phosphate Inc. is security of supply. It is this secure supply of high-quality phosphate rock that will become increasingly important to end users. . .the company is substantially derisked based on a published bankable feasibility study demonstrating strong economics, a sound balance sheet, strong insider and institutional holders and a deposit in a favorable jurisdiction."

Bob Moriarty, 321 Gold (1/22/14) "The only thing holding Arianne Phosphate Inc. back is the overhang of 4M shares. When we pass February 1, the overhang is gone and it would be perfectly natural for the shares to roar higher. The company is a takeover target. Typically with phosphate companies, takeover offers are in the .35% to .5% range. That means $7 to $10.50 a share. You don't get this kind of opportunity often. It may be on sale now but it wont be for long."

The Mining Report Interview with Amanda Van Dyke (1/21/14) "I'm quite fond of Arianne Phosphate Inc. It has a beautiful deposit in Quebec, a fully bankable feasibility study and a good IRR in a safe jurisdiction. We don't know when Lac Paul will be green-lighted, but it is a great long-term investment. I have no doubt that eventually it be a significant part of the phosphate mix in North America." More >

Brien Lundin, Gold Newsletter (Jefferson Financial) (12/19/13) "Arianne Phosphate Inc. released the feasibility study on its Lac a Paul project. . .given the size and high grade of the phosphate rock at Lac a Paul, I anticipated that the numbers would be good and that the company's share price would spike as a result. Both those predictions proved accurate. .as its management team moves this high-profile phosphate project towards production, the market is eventually going to wake up to the fact that Arianne is sitting on a gold mine here (OK, a phosphate mine)."

Jay Taylor, Gold, Energy & Tech Stocks (12/13/13) "I continue to believe Arianne Phosphate Inc.'s phosphate mine in Quebec is not being given the respect it deserves. With phosphate shortages taking shape around the world, it seems very likely to me that one and hopefully two or three of the major fertilizer companies will view this as a must-have asset."

Chris Berry, Disruptive Discoveries Journal (12/13/13) "A supply of phosphate from a geopolitically stable part of the world will become increasingly important against the backdrop of shrinking arable land and growing populations. One example is Arianne Phosphate Inc., which is developing a high-grade phosphate deposit in Quebec; the project is substantially derisked to the point of having a prefeasibility study published demonstrating strong economics."

The Gold Report Interview with James West (12/11/13) "Arianne Phosphate Inc. is currently the subject of takeover talks. The company just came out with a $2 billion net present value on its Lac Paul deposit. I'm forecasting a takeout price of $811/share. It's currently trading at $1.60/share." More >

Bob Moriarty, 321 Gold (11/30/13) "For those who still hate gold and silver, Arianne Phosphate Inc. is an excellent option. The company released an NI 43-101 about two weeks ago showing a NPV of $1.9B. For a company with a market cap of $120M, that isn't going to last all that long."

Engineering and Mining Journal (11/5/13) "Arianne Phosphate Inc.'s property is an example of innovative partnerships with engineering and finance players to maximize operational value. For its bankable feasibility study, started in August 2012, the company enlisted the engineering expertise of Cegertec WorleyParsons."

Resource Investing News Interview with Brian Ostroff (11/5/13) "Arianne Phosphate Inc. has been gifted with an igneous deposit. . .the company is able to produce a 39% phosphate concentrate which sells at a very premium price. . .as for the right location, it's perfect. . .here is this deposit in Quebec that makes a very pure concentrate, it has a very large resource, close to infrastructure including a deep-sea port right in the heart of where there is a shortage. It is also in a good jurisdiction when it comes to permitting, social acceptance, familiarity with mining and sourcing of investment. . .a lot of people throw around the word 'world class,' but this asset is just that."

James West, Midas Letter (10/29/13) "Arianne Phosphate Inc. is a company that certainly bears having a closer look at now. . .I believe there is growing impetus from shareholders seeking to monetize their investment sooner rather than later. This could be accomplished by putting the company into play and selling it to either Agrium Inc. or The Mosaic Co. or some other major player in the space."

John Chu, Alta Corp Capital (10/28/13) "Arianne Phosphate Inc. released the highlights for the feasibility study (FS) on its Lac Paul phosphate rock project. . .highlights from the FS include robust economics: an NPV of $1.9B based on an 8% discount rate. This results in an internal rate of return of 20.7% and a payback period of 4.4 years. . .with the company reaching a key milestone, we believe this makes it more attractive to potential strategic partners."

Anoop Prihar, GMP Securities (10/28/13) "On Oct. 24, Arianne Phosphate Inc. released its feasibility study for the Lac Paul phosphate concentrate project. . .the study suggests that Lac Paul has the potential to produce 3 Mtp/year 0.6% P2O5 concentrate. This would be amongst the highest-grade phosphate concentrates produced globally. . .we believe potentially significant valuation upside does exist."

Thibaut Lepouttre, Caesars Report (10/28/13) "Arianne Phosphate Inc. has announced the results of the feasibility study on its fully owned Lac Paul phosphate project in Qubec, Canada. This is the first time the additional resources are incorporated in the mine plan and the mine life has increased from 17 years to almost 26 years. . .as the U.S. and Canada are net importers of phosphate, we can imagine large fertilizer producers such as Mosaic Co. or Agrium Inc. might be very interested in a source of premium quality phosphate in Canada and could be willing to provide financing for the project in return for a (minority) stake in Lac Paul."

Bob Moriarty, 321 Gold (10/28/13) "Arianne Phosphate Inc.'s bankable feasibility study is a giant step forward; it removes most of the financial uncertainty that a major phosphate company would want removed before taking a run at the company. The numbers are beyond incredible. You will see projects with longer lifetime or lower capex or a higher internal rate of return, but never in your life will you see a company with a resource of this quality in a politically safe country selling for 6% of its NPV."

Robert Winslow, National Bank Financial (10/27/13) "Arianne Phosphate Inc.'s bankable feasibility study for its high-grade Lac Paul phosphate project is a partial derisking event. . .project capacity is still 3 Mtp/year 38%+ P2O5 concentrate for an ~26-year life of mine. The project economics remain attractive, with an after-tax internal rate of return estimated near 17%."

Brien Lundin, Gold Newsletter (Jefferson Financial) (10/24/13) "Arianne Phosphate Inc. is a solid long-term play on population growth and the increasing food demand that comes with it. . .the deposits on the companys Lac Paul are capable of producing a concentrate with a higher percentage of phosphate than the typical deposit in Morocco (or most otherlocales, for that matter). . .the key development for Arianne is its feasibility study for Lac Paul. . .the report is expected to be positive."

The Gold Report Interview with Brian Ostroff (10/2/13) "The largest holding in our fund is Arianne Phosphate Inc. Since we last talked, the company has been very busy. Additional drilling has tripled the resource in just its Lac Paul pit. It now has 750 Mt phosphate rock grading a little over 7%. That makes it the biggest undeveloped phosphate asset in the world. It is a unique deposit. Ninety percent of the world's phosphate deposits are sedimentary, which often has a higher in situ grade, but cannot be turned into as high of concentrate grade. Sedimentary deposits, such as those in Morocco or in Florida where Mosaic has most of its production, also tend to include contaminants like uranium, thorium and cadmium, which pose environmental issues. Arianne has an igneous deposit, similar to several Russian deposits. Although a lower grade in situ, it can make a very pure concentrate. Arianne's metallurgical tests show it produces a 39% concentrate. That gives it roughly 30% more phosphate content than a typical Moroccan style concentrate.

". . .In addition to tripling its resource and confirming its metallurgy, Arianne has made some additions to its board and management; these are some pretty serious guys. Steven Pinney was former head of fertilizers at Cargill and then senior vice president of phosphates at The Mosaic Co. Dominique Bouchard was the president of Rio Tinto Iron Ore and Titanium. Dominique has a great understanding of bulk commodities and how to transport them. Brian Kenny, a seasoned mine builder, joined as CEO. He built Falconbridge Ltd.'s New Caledonia mine and spent the last few years in the Middle East with Dubai Aluminium Co. Ltd. . .Pierre Fitzgibbon, who has held very senior positions with National Bank and sat on the board of the Caisse de Depot et Placement du Quebec. . .the company will put out its bankable feasibility study (BFS) sometime around mid- to late October. That will tell a lot. A prefeasibility study released a year-and-a-half ago estimated a capital expense (capex) of about $800M to build a mine. In my experience, it is not uncommon for a BFS to see a 50% increase." More >

Brien Lundin, Gold Newsletter (Jefferson Financial) (9/26/13) "I am recommending Arianne Phosphate Inc. at this time because this company has the right resource at the right time and in the right location. . .with Arianne's Lac Paul project on the verge of having a feasibility study generated for it, now is the perfect time to get positioned in this potential takeout target. . .it's a Strong Buy at these trading levels."

Brien Lundin, Gold Newsletter (Jefferson Financial) (9/20/13) "Arianne Phosphate Inc. is a company that seems to have the right resource at the right time and in the right location. . .with the company's Lac Paul project on the verge of having a feasibility study completed, perhaps within a few weeks, now is the perfect time to get positioned in this potential takeout target. If the numbers come in like I expect on the feasibility study, the project will show the ability to generate 3 Mmt of phosphate concentrate per year for 25 years. . .add in proximity to power and an available port just 300km away, and you have all the makings of a project that can easily get greenlighted even in the current environment."

James West, Midas Letter (9/8/13) "Arianne Phosphate Inc. has accomplished a number of notable goals this year, including changing its name from Arianne Resources Inc. to to reflect its single-project commitment and hiring Brian Kenny as CEO, who is a seasoned project development executive. . .with all the buzz, it just might be the takeover target of the year."

Anoop Prihar, GMP Securities (7/3/13) "On June 26, 2013, Arianne Phosphate Inc. announced that Brian Kenny would succeed the retiring Bernard Lapointe as CEO effective July 3, 2013. Mr. Kenny has 30+ years of experience in the mining and engineering sectors. . .we view the recent personnel additions as positive, as the accumulated experience of the individuals should aid in the ongoing derisking of the Lac Paul project. . .not only does Lac Paul have the potential to become a 3 Mtpa open-pit phosphate mine, but the 39% P2O5 concentrate would be among the highest quality phosphate concentrates produced globally."

Carolyn Dennis, Dundee Capital Markets (3/13/13) "We are initiating coverage of Arianne Phospate Inc. with a Buy rating. . .the company is developing its 100%-owned Lac Paul project in Quebec. . .initial metallurgical tests indicate high-grade concentrate and high recovery. . .Arianne should benefit from existing infrastructure and is ~300km by road to the Saguenay Port, allowing access to international markets, notably Europe."

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