Chile's SQM to buy stake in Australia's Elemental Minerals
SANTIAGO, Sept 1 (Reuters) - Chilean chemical and fertilizer producer SQM said on Thursday that it has agreed to purchase a 17 percent stake in Australia's Elemental Minerals Ltd, giving it a foothold in various potassium deposits in the Republic of Congo.
SQM said that preliminary studies suggest that the projects, which still require definitive feasibility studies, "boast some of the highest grade potassium available and could therefore potentially lead to some of the lowest-cost production in the market."
SQM will subscribe to a $20 million capital increase in Elemental Minerals in exchange for the 17 percent and a right of first refusal for some 20 percent of the company's total potash production.
The deal comes as SQM is facing arbitration procedures in Chile with government-run economic development agency Corfo over leasing payments.
"We are confident that adding this project to our growing portfolio offers real potential long-term growth opportunities for SQM," said SQM's chief executive Patricio de Solminihac. (Reporting by Anthony Esposito; Editing by Chizu Nomiyama)
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