Morocco Phosphate Production Boosted as Key Financing Deal Approved

Home  /  Morocco Phosphate Production Boosted as Key Financing Deal Approved

A key financing deal was secured by government owned Office Cherifien des PhosphatesTO GO WITH AFP STORY BY EMILE KOUTON Pi (OCP) last week that boosted Morocco’s phosphate production last month. The said deal is a long-term development strategy for the continuous production growth of phosphate in the Kingdom.
Phosphates represent around a quarter of Morocco’s export revenue, and while efforts to increase production should improve external receipts in the medium to long term, sales have declined by more than 20% this year as a result of lower global mineral prices.
A loan agreement of $271m from the German state-owned development bank KfW in early October poised OCP to embark on extensive capital upgrades. This loan will be use for an 11-year term with a three-year grace period, to finance the construction of two water desalination plants in the key ports of Jorf Lasfar and Safi; Waste water treatment stations at the Khouribga, Youssoufia and Benguérir mine sites will also be developed, alongside water adduction and distribution systems at both mining and industrial facilities.
In 2009, OCP launched a wide-ranging program that targets to double the phosphate rock and derivatives output by 2020.
OPC’s new development strategy includes industrial infrastructure and overhauling mining, alongside installing more efficient water usage systems, is expected to enhance industrial output. The OCP is planning to roll out its development program focusing on the market’s eventual recovery that will occur in 2015.
The OCP aims to boost production of phosphate rock from its current level of 34m tons to 50m by 2020 through its ten-year Dh130bn (€11.56bn) investment program. Plans are also being made to increase annual fertilizer output from 3.5m tons to 10m. In addition, the company has said it aims to reduce production costs by up to 40% by overhauling infrastructure and expanding port operations.