Encanto Potash Corp has recently completed the foundation for an evolutionary offtake agreement with the National Federation of Farmers’ Procurement, Processing and Retailing Cooperatives of India Ltd ("NACOF"). The terms of the offtake agreement are summarized in a memorandum of agreement (the "MOA") that provides for a minimum supply of 5 million tonnes per year for a minimum 20 year term, pending final negotiations related to the offtake agreement.
NACOF is a national farming cooperative under the Indian Ministry of Agriculture, Government of India representing farmers in 25 states across India. NACOF also enters into joint marketing and exchange agreements with Cooperative Institutions and Public Sector Undertakings such as Metal Mineral Trading Company of India ("MMTC") or other Government agencies in India and abroad.
The MOA with NACOF now positions Encanto for the transition of the previously announced memorandum of understanding between Encanto and MMTC (the "MMTC MOU") into a Commercial Marketing and Distribution Agreement to provide for the sale of an additional minimum of 2 million tonnes of potash annually, as MMTC was appointed Encanto’s exclusive worldwide potash marketing agent. Under the MMTC MOU, MMTC has the ability to sell potash sourced by Encanto into India or beyond.