Itafos's Brazilian Bet Solidified by Robust Economic Assessment for Arraias Phosphate Project

HOUSTON, TX – February 09, 2026 – Itafos Inc. has solidified its strategic ambitions in South America by filing a key technical report that underscores the compelling economic potential of its Arraias phosphate project in Tocantins, Brazil. The filing of the National Instrument 43-101 (NI 43-101) compliant report provides a detailed, third-party validated blueprint for the project, signaling a significant step forward in the company's plan to become a key supplier to Brazil's vast agricultural sector.

The report, prepared by the respected engineering firm WSP Canada Inc., outlines an updated Preliminary Economic Assessment (PEA) for Arraias. The findings reveal a highly attractive investment profile, projecting a rapid payback period and a substantial rate of return, which could significantly de-risk the project's next phases of development and financing.

This move comes as Brazil, an agricultural superpower, continues to seek greater self-sufficiency in fertilizers to reduce its heavy reliance on imports. By advancing the Arraias project, Itafos is positioning itself not just as a business enterprise, but as a strategic partner in bolstering the nation's food security and agricultural independence.

The Economic Blueprint for Profitability

The updated PEA paints a powerful picture of financial viability. The assessment highlights a post-tax Internal Rate of Return (IRR) of an impressive 85%, a metric that is bound to capture the attention of investors. This is complemented by an after-tax Net Present Value (NPV) of US$70.7 million, calculated using an 8% discount rate. Perhaps most striking is the projected payback period of approximately two years, suggesting a swift return on the required capital investment.

That capital investment is notably modest. The PEA estimates that only US$8.0 million in capital expenditures (CAPEX) will be needed for crucial upgrades to the site's beneficiation plant. This upgrade is the centerpiece of the project's next phase, enabling the production of Single Superphosphate (SSP), a widely used and effective phosphate fertilizer.

The project's economics are underpinned by a solid mineral resource base. The NI 43-101 report details measured and indicated resources totaling 2 million tonnes, with an additional 3 million tonnes classified as inferred resources. The mine plan, which has a current life of approximately 14 years, involves continued mining at the Domingos deposit while blending material from other nearby deposits—Cana Brava, Coite, and Near Mine—to ensure a consistent and optimal grade of phosphate rock is fed to the plant. This resource base provides a firm foundation for the long-term production goals outlined in the assessment.

From Report to Reality: De-Risking a Key Asset

The filing of a comprehensive NI 43-101 technical report is more than a regulatory formality; it is a critical milestone in de-risking a major capital project. By subjecting the Arraias project's data, assumptions, and financial models to the scrutiny of an independent firm like WSP Canada, Itafos provides the market with a transparent and credible validation of its plans.

This third-party endorsement is crucial for securing future financing, attracting partners, and building shareholder confidence. It demonstrates that the project is not just a concept but a technically sound and economically vetted opportunity. The report consolidates all project work to date, creating a single source of truth for stakeholders evaluating the project's progression from its current state toward full-scale SSP production.

Company leadership has expressed significant satisfaction with the PEA's findings, noting that the results strongly support the fertilizer restart strategy at Arraias. The successful operation of the mine in recent years, coupled with this positive economic assessment, paves the way for subsequent development stages. The focus for 2026 will be a transitional period dedicated to implementing the beneficiation circuit upgrades required to produce SSP.

A Strategic Pivot for a Growing Market

The decision to invest in SSP production represents a significant strategic pivot for Itafos at the Arraias site. The company has already found success since 2023 by mining and selling Direct Application Product (DAPR) and Partially Acidulated Product (PAPR). In fact, 2025 was a record year for profitability at the site, proving the operational viability of mining the breccia and conglomerate deposits.

However, the shift to SSP production opens a much larger and more established market. SSP is a cornerstone fertilizer in Brazilian agriculture, and by producing it domestically, Itafos can offer a competitive alternative to imported products. This move aligns perfectly with Brazil's national strategy to reduce its dependence on foreign fertilizer supplies, which can be subject to volatile pricing and geopolitical disruptions.

The Arraias operation is designed as a vertically integrated business. With an existing gross sulfuric acid production capacity of 220 kilotonnes per year, the facility is well-equipped to support the SSP production process. The PEA targets an annual production capacity of approximately 500 kilotonnes of SSP and SSP with micronutrients, alongside about 40 kilotonnes of excess sulfuric acid for sale, adding another revenue stream.

With the upgrades planned for 2026, Itafos aims to begin selling its SSP products into the Brazilian market in 2027. This timeline provides a clear path for the company to capitalize on the robust demand from one of the world's most important agricultural economies, transforming the Arraias project into a cornerstone of its global portfolio.