A1. Offer Document (Clean) PDF

THIS DOCUMENT IS IMPORTANT.
IF YOU ARE IN ANY DOUBT AS TO

THE ACTION YOU SHOULD TAKE, YOU SHOULD CONSULT YOUR
LEGAL, FINANCIAL, TAX OR OTHER PROFESSIONAL ADVISER(S).
United Overseas Bank Limited (the Sponsor) has made an application to the Singapore
Exchange Securities Trading Limited (the SGX-ST) for permission to deal in and for quotation
of, all the ordinary shares (the Shares) in the capital of AsiaPhos Limited (the Company)
already issued (including the Vendor Shares (as defned herein)), and the New Shares (as
defned herein) which are the subject of this Invitation (as defned herein) on Catalist (as defned
herein) and the Shares which may be issued under the AsiaPhos Performance Share Plan to
be listed for quotation on Catalist. Acceptance of applications will be conditional upon, inter
alia, the issue of the New Shares and permission being granted by the SGX-ST for the listing
and quotation of all our existing issued Shares (including the Vendor Shares), the New Shares
and the Shares which may be issued under the AsiaPhos Performance Share Plan on Catalist.
Monies paid in respect of any application accepted will be returned to you at your own risk,
without interest or any share of revenue or other beneft arising therefrom, and you will not have
any claim against our Company, the Sponsor and Underwriter, the Placement Agent or the
Vendors (each as defned herein) if the admission and listing do not proceed. The dealing in
and quotation of our Shares will be in Singapore dollars.
Companies listed on Catalist may carry higher investment risk when compared with larger or
more established companies listed on the Mainboard of the SGX-ST. In particular, companies
may list on Catalist without a track record of proftability and there is no assurance that there
will be a liquid market in the shares or units of shares traded on Catalist. You should be aware
of the risks of investing in such companies and should make the decision to invest only after
careful consideration and, if appropriate, consultation with your professional adviser(s).
Neither the Monetary Authority of Singapore (the Authority) nor the SGX-ST has examined or
approved the contents of this Offer Document. Neither the Authority nor the SGX-ST assumes
any responsibility for the contents of this Offer Document, including the correctness of any of
the statements or opinions made or reports contained in this Offer Document. The SGX-ST
does not normally review the application for admission but relies on the Sponsor confrming
that the Company is suitable to be listed and complies with the Catalist Rules (as defned
herein). Neither the Authority nor the SGX-ST has in any way considered the merits of the
Shares or units of Shares being offered for investment. The registration of this Offer Document
by the SGX-ST does not imply that the SFA (as defned herein), or any other legal or regulatory
requirements or requirements under the SGX-STs listing rules, have been complied with.
This offer is made in or accompanied by this Offer Document that has been registered by the
SGX-ST acting as agent on behalf of the Authority. We have not lodged or registered this Offer
Document in any other jurisdiction.
In the event the Placement Agent receives valid applications and payment for less than
85% of the Placement Shares by 12.00 noon on 2 October 2013 (or such later date and
time as may be decided by the Placement Agent), the Placement Agent shall have the
right to terminate the Placement Agreement (by notice in writing to the Company and
the Vendors). The Management and Underwriting Agreement is conditional upon the
Placement Agreement not being terminated or rescinded. In the event of termination
of the Placement Agreement, the Management and Underwriting Agreement will
also terminate. In the event the Management and Underwriting Agreement and/ or
the Placement Agreement are terminated, our Company and the Vendors reserves
the right, in our and their absolute discretion, to cancel the Invitation, upon which all
application monies will be returned to subscribers and/ or purchasers without interest
or any share of revenue or other beneft arising there from and at their own risk, and
subscribers and/or purchasers will not have any claim against our Company, the
Vendors, the Sponsor and Underwriter or the Placement Agent.
The investment in our Shares involves risks which are described in the section entitled
Risk Factors of this Offer Document. After the expiration of six (6) months from
the date of registration of this Offer Document by the SGX-ST acting as agent on
behalf of the Authority, no person shall make an offer of securities, or allot, issue or
sell or allocate any securities, on the basis of this Offer Document, and no offcer or
equivalent person or promoter of the Company will authorise or permit the offer of any
securities or the allotment, issue or sale or allocation of any securities, on the basis of
this Offer Document.
Sponsor and Underwriter

UNITED OVERSEAS BANK LIMITED
(Company Registration No. 193500026Z)
(Incorporated in the Republic of Singapore)
A Singapore-headquartered mineral resources company focused on
exploring and mining phosphate in the PRC
ASIAPhOS LIMITeD
(Company Registration Number: 201200335G)
(Incorporated in the Republic of Singapore on 3 January 2012)
Placement Agent

ASIASONS WFG CAPITAL PTE. LTD.
(Company Registration No. 200002789M)
(Incorporated in the Republic of Singapore)
Invitation in respect of 122,000,000 Invitation Shares
comprising 97,600,000 New Shares and 24,400,000 Vendor
Shares as follows:
(1) 2,000,000 Offer Shares at S$0.25 for each Offer Share
by way of public offer; and
(2) 120,000,000 Placement Shares at S$0.25 for each
Placement Share by way of placement,
payable in full on application.
OFFER DOCUMENT DATED 25 SEPTEMBER 2013
(Registered by the singapore exchange securities trading Limited acting as agent on behalf of the monetary Authority of singapore on 25 september 2013)
A Singapore-headquartered mineral resources company focused on
exploring and mining phosphate in the PRC
ASIAPhOS LIMITeD
(Company Registration Number: 201200335G)
(Incorporated in the Republic of Singapore on 3 January 2012)
This overview section is qualifed in its entirety by, and should be read in conjunction with, the full text of this Offer Document. Meanings of
capitalised terms used may be found in the sections entitled Defnitions and Glossary of Technical Terms of this Offer Document.
CORPORATE PROFILE
We are the frst mineral resources company to be listed on
the SGX-ST which is solely focused on exploring and mining
phosphate in the PRC with the ability to manufacture and produce
phosphate-based chemical products.
To make full use of this valuable and non-renewable natural
resource, we are adopting a vertically-integrated strategy which
will comprise mining of our phosphate rocks and the production of
Led by a management team with more than 10 years of relevant
experience in their respective felds, we currently own exploration
and mining rights to our two mines and have recently completed
construction of a P
4
plant. As part of our future plans, we intend to
construct more processing facilities.
Although our operations were disrupted by the Wenchuan
Earthquake in 2008, we have since embarked on a rebuilding
programme.

Phosphate
Rocks
P4
Thermal
Phosphoric
Acid
STPP
(food/non food
grade)
SHMP
(food/non food
grade)
OUR VERTICALLY-INTEGRATED STRATEGY
Upon completion of our Rebuilding Programme, our vertically-integrated business model will involve the following:
Mining OPeRATiOns
Mining
Rights to explore and mine phosphate from our two mines located in Qing Ping Town,
Mianzhu City, Sichuan Province, the PRC
As at 31 December 2012, 22.2 million tonnes of measured and indicated phosphorite
resources; 18.8 million tonnes of inferred phosphorite resources*
Current mining licence periods are up to 2015 and 2020 (licences are renewable)
* WGM Technical Report dated 28 February 2013 prepared in accordance with NI 43-101 relating to the mineral resources.
CheMiCAl PROduCTiOn OPeRATiOns
P4 Processing
Processing of phosphate rocks to P4
Trial production of P4 commenced in FY2013
Plant is designed to withstand earthquakes of up to 7.0 on the Richter magnitude scale
Acid Manufacturing
Manufacturing into thermal phosphoric acid from P4
Planned construction of new thermal phosphoric acid plant with designed capacity of
30,000 tonnes per year
SHMP and STPP Manufacturing
Further processing of thermal phosphoric acid into other phosphate-based chemical
products such as shmP and stPP
Completed temporary relocation of one STPP plant with designed capacity of 30,000
tonnes per year, from old premises to New Gongxing Site
Planned construction of one SHMP plant with designed capacity of 20,000 tonnes per year
PHOSPHATE An Essential Mineral for Life
Phosphorus, phosphates and phosphate-based chemical products are used in, or in the manufacturing process for, many
everyday products, such as:
oral hygiene
products
Paint LCd panels and
plasma screens
Food and beverage
products
ASIAPhOS LIMITeD
COMPETITIVE STRENGTHS
Experienced management team from
Singapore and the PRC
DrOngHianEng,CEOandExecutiveDirector,
has extensive knowledge of, and experience in,
the phosphate industry
Ateamofexperiencedandcompetentkey
executives many of whom have more than
10 years of relevant experience in their
respective felds
Relatively higher quality phosphate rocks
Ourphosphaterocksareofrelativelyhigher
quality than other phosphate rocks mined in the
PRC (higher levels of P2O5)

Lower production costs for our Chemical
Production Operations
We currently enjoy relatively lower costs of
production due to:
vertically-integratedbusinessmodelwhich
ensures low costs of quality raw material
without supply volatility, barring unforeseen
circumstances
production effciencies due to phosphate
rocks with relatively high P2O5 content from
our two mines, which have lower impurities
and fewer processing issues, and construction
of new production facilities which incorporate
current technology
improved logistics and transportation
with, inter alia, the completion of the Mian
MaoHighwaywhichwillincreaseaccessibility
between our two mines and production facilities,
and is expected to reduce transportation costs
Close proximity between our two mines and
processing facilities and to customers
Theshortdistanceofapproximately40km
between our two mines and processing facilities
helps to minimise transportation costs for
rock delivery
Wehavequickaccesstomanyofourcustomers
PROSPECTS AND TREND
INFORMATION
Growing demand for phosphate rocks expected
Worldphosphaterockconsumptionisexpected
to achieve a compound annual growth rate
(CAGR) of 1.8% per year (from 2012 to 2022).
The 2022 forecast for such consumption is 227.6
million tonnes
(1)
Chinawillremainastheworldslargestphosphate
rock consumer and its consumption is forecast
to be fat going forward to 2022
(2)
Pricesofphosphaterocksareexpectedtotrend
upwards in the near-term based on past average
sale prices of our phosphate rocks
Prices of fertilisers, a main application of
phosphates, are expected to trend upwards due to
an increasing demand for food from an increasing
world population and limitations in the amount of
arable land for farming

Demand for elemental phosphorus will increase
modestly over the next ten years
Overallgrowthforphosphorusdependent
derivatives is expected to increase at about
4.5%peryearfrom2012to2022
(3)
ChineseSTPPdemandinsectors(otherthan
detergents) such as food applications, water
treatment and metal treatment is forecast to
grow above GDP growth of the PRC
(4)
Pricesofphosphate-basedchemicalproducts
are expected to remain steady
(1), (2), (3), (4)
Source: CRU Industry Report
FINANCIAL HIGHLIGHTS
(Financial Year ended 31 december)
Pharmaceutical
products
Fertilisers Fire retardants Animal feed
Revenue by Geographical Locations of
Our Customers (%)
FY2012 FY2011 FY2010 FP2013*
100
80
60
40
20
0
%
S$million FY2010 FY2011 FY2012 FP2013*
Upstream Segment
Downstream Segment
Revenue
0.4
2.4
2.8
1.5
3.0
4.5
3.7
1.2
4.9
1.0
0.3
1.3
Net Proft after Tax (1.2) 2.9 1.2 (0.7)
* for 3 months ended 31 March
Mining Output
Revenue and Proft
100
80
60
40
20
0
FY2010
4.2
FY2011
30.2
93.0
FY2012
60.1
6 months ended
30 June 2013
Tonnes (000)
BUSINESS STRATEGIES AND FUTURE PLANS
Further mining and
exploration activities
Carryoutfurther
exploration works to
locate new deposits
within permitted areas,
to convert exploration
rights into mining rights
Increasethenumberof
producing adits by up
to 5
Investinmining-related
infrastructure and
equipment:
> haulage systems and
related equipment for
new adits
> additional works
and safety
enhancements to
existing adits
> maintain and repair
roads to improve
accessibility to our
mines and adits
Rebuild, enhance and
increase the capacity
of our Chemical
Production Operations
Commencedtrial
production of P4 in
FY2013
Constructastorage
facility to collect and use
fue gas, a by-product of
P4 processing
Constructandupgrade
processing facilities to
enhance our processing
and manufacturing
capabilities
Increase our
portfolio of
phosphate-based
chemical products
Diversifyourportfolio
of phosphate-based
chemical products
by establishing an
in-house research
and development
team and/or through
outsourcing
Expand through
acquisitions, joint
ventures and
strategic alliances
Enterinto
acquisitions, joint
ventures or strategic
alliances with, inter
alia, parties who
create synergistic
values with our
existing business
Adopt a vertically-
integrated strategy
Withthecompletionof
our production facilities,
our vertically-integrated
operations will give
us raw materials price
and supply stability,
raw materials quality
assurance, and sales
and production
fexibility
Overseas
Overseas markets include Canada, India, New Zealand, Pakistan, Philippines,
South Korea, Spain, Switzerland, United Arab Emirates, USA and Vietnam.
PRC
* for 3 months ended 31 march
89
11
54
46
45
55
91
9
INDEPENDENT VALUATION
Based on the independent valuation report by Jones Lang LaSalle Corporate Appraisal and Advisory
Limited, prepared and presented in accordance with the VALMIN Code, the fair market value of our two
mines and P4 plant was approximately between RMB 1.0 billion (or approximately S$207.6 million*) and
RMB 1.6 billion (or approximately S$332.1 million*) with the preferred value being RMB 1.3 billion (or
approximately S$269.8 million*) as at 31 March 2013.
* Based on the exchange rate as at Latest Practicable Date.
i
CONTENTS
CORPORATE INFORMATION ........................................................................................................... 1
DEFINITIONS ..................................................................................................................................... 5
GLOSSARY OF TECHNICAL TERMS ............................................................................................... 15
SELLING RESTRICTIONS ................................................................................................................ 19
CAUTIONARY NOTES REGARDING FORWARD-LOOKING STATEMENTS ................................. 20
OFFER DOCUMENT SUMMARY ...................................................................................................... 22
DETAILS OF THE INVITATION .......................................................................................................... 25
INDICATIVE TIMETABLE FOR LISTING .......................................................................................... 30
SUMMARY OF INVITATION .............................................................................................................. 31
PLAN OF DISTRIBUTION ................................................................................................................. 32
INVITATION STATISTICS .................................................................................................................. 34
USE OF PROCEEDS ......................................................................................................................... 36
MANAGEMENT, UNDERWRITING AND PLACEMENT ARRANGEMENTS .................................... 38
RISK FACTORS ................................................................................................................................. 41
RISKS RELATING TO OUR BUSINESS ...................................................................................... 41
RISKS RELATING SPECIFICALLY TO OUR MINING OPERATIONS ......................................... 51
RISKS RELATING SPECIFICALLY TO OUR CHEMICAL PRODUCTION OPERATIONS UPON
COMMENCEMENT OF OUR CHEMICAL PRODUCTION OPERATIONS.................................. 55
RISKS RELATING TO OUR OPERATIONS IN THE PRC ........................................................... 58
RISKS RELATING TO OWNERSHIP OF OUR SHARES ............................................................ 61
EXCHANGE RATES AND EXCHANGE CONTROLS ....................................................................... 65
DIVIDEND POLICY ............................................................................................................................ 67
CAPITALISATION AND INDEBTEDNESS ........................................................................................ 69
DILUTION ........................................................................................................................................... 73
RESTRUCTURING EXERCISE ......................................................................................................... 75
SHARE CAPITAL AND SHAREHOLDERS ...................................................................................... 76
SHAREHOLDERS ........................................................................................................................ 78
VENDORS .................................................................................................................................... 81
MORATORIUM ............................................................................................................................. 82
OUR GROUP STRUCTURE .............................................................................................................. 84
ii
CONTENTS
GENERAL INFORMATION ON OUR GROUP .................................................................................. 85
HISTORY ...................................................................................................................................... 85
BUSINESS OVERVIEW ............................................................................................................... 87
USES OF PHOSPHATES ............................................................................................................ 88
MINING OPERATIONS ................................................................................................................ 88
CHEMICAL PRODUCTION OPERATIONS ................................................................................. 94
INDEPENDENT VALUATION ....................................................................................................... 97
CORPORATE SOCIAL RESPONSIBILITY .................................................................................. 97
QUALITY ASSURANCE ............................................................................................................... 99
INTELLECTUAL PROPERTY ...................................................................................................... 101
RESEARCH AND DEVELOPMENT ............................................................................................ 102
INSURANCE ................................................................................................................................ 102
SALES AND MARKETING ........................................................................................................... 103
CREDIT MANAGEMENT ............................................................................................................. 103
STAFF TRAINING AND DEVELOPMENT ................................................................................... 104
SEASONALITY ............................................................................................................................ 104
INVENTORY MANAGEMENT ...................................................................................................... 105
MAJOR SUPPLIERS .................................................................................................................... 106
MAJOR CUSTOMERS ................................................................................................................. 107
PROPERTIES AND FIXED ASSETS ........................................................................................... 108
PERMITS, LICENCES, APPROVALS AND GOVERNMENT REGULATIONS ............................ 110
LEGAL OPINION FROM KING & WOOD MALLESONS ............................................................. 111
PRC GOVERNMENT REGULATIONS ......................................................................................... 122
COMPETITION ............................................................................................................................ 127
COMPETITIVE STRENGTHS ...................................................................................................... 128
PROSPECTS AND TREND INFORMATION ............................................................................... 130
BUSINESS STRATEGIES AND FUTURE PLANS....................................................................... 131
ORDER BOOK ............................................................................................................................. 134
SELECTED COMBINED FINANCIAL INFORMATION ..................................................................... 135
MANAGEMENTS DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS AND
FINANCIAL POSITION ...................................................................................................................... 137
MANAGEMENT AND CORPORATE GOVERNANCE ...................................................................... 162
MANAGEMENT REPORTING STRUCTURE .............................................................................. 162
DIRECTORS ................................................................................................................................ 163
KEY EXECUTIVES ...................................................................................................................... 169
SERVICE AGREEMENTS ............................................................................................................ 171
ARRANGEMENT OR UNDERSTANDING ................................................................................... 172
DIRECTORS AND KEY EXECUTIVES REMUNERATION ......................................................... 172
EMPLOYEES ............................................................................................................................... 173
iii
CONTENTS
CORPORATE GOVERNANCE ..................................................................................................... 173
AUDIT COMMITTEE .................................................................................................................... 174
NOMINATING COMMITTEE ........................................................................................................ 175
REMUNERATION COMMITTEE .................................................................................................. 177
LEGAL REPRESENTATIVE AND SUPERVISOR OF OUR PRC SUBSIDIARY, MIANZHU
NORWEST ................................................................................................................................... 177
ASIAPHOS PERFORMANCE SHARE PLAN ................................................................................... 179
INTERESTED PERSON TRANSACTIONS AND CONFLICTS OF INTERESTS ............................. 190
PAST INTERESTED PERSON TRANSACTIONS ....................................................................... 190
PRESENT AND ON-GOING INTERESTED PERSON TRANSACTIONS ................................... 191
REVIEW PROCEDURES FOR FUTURE INTERESTED PERSON TRANSACTIONS ............... 192
POTENTIAL CONFLICTS OF INTERESTS ................................................................................. 193
CLEARANCE AND SETTLEMENT ................................................................................................... 195
GENERAL AND STATUTORY INFORMATION ................................................................................. 196
APPENDIX A : AUDITED COMBINED FINANCIAL STATEMENTS FOR THE FINANCIAL
YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012 .................................... A-1
APPENDIX B : UNAUDITED INTERIM CONDENSED COMBINED FINANCIAL STATEMENTS
FOR THE THREE MONTHS PERIOD ENDED 31 MARCH 2013 ........................ B-1
APPENDIX C : UNAUDITED PRO FORMA COMBINED FINANCIAL INFORMATION FOR
THE FINANCIAL YEAR ENDED 31 DECEMBER 2012 AND THE THREE
MONTHS PERIOD ENDED 31 MARCH 2013 ..................................................... C-1
APPENDIX D : SUMMARY OF MEMORANDUM AND ARTICLES OF ASSOCIATION OF
OUR COMPANY ................................................................................................... D-1
APPENDIX E : DESCRIPTION OF OUR SHARES ...................................................................... E-1
APPENDIX F : RULES OF THE ASIAPHOS PERFORMANCE SHARE PLAN .......................... F-1
APPENDIX G : TERMS, CONDITIONS AND PROCEDURES FOR APPLICATION AND
ACCEPTANCE ..................................................................................................... G-1
APPENDIX H : SUMMARY OF RELEVANT PRC LAWS AND REGULATIONS ......................... H-1
APPENDIX I : TAXATION ............................................................................................................ I-1
APPENDIX J : WGM TECHNICAL REPORT ............................................................................... J-1
APPENDIX K : INDEPENDENT VALUATION REPORT ............................................................... K-1
APPENDIX L : CRU INDUSTRY REPORT ................................................................................... L-1
1
CORPORATE INFORMATION
BOARD OF DIRECTORS

: Hong Pian Tee (Non-Executive Chairman and Independent
Director)
Dr. Ong Hian Eng (CEO and Executive Director)
Ong Eng Hock Simon (Executive Director)
Ong Eng Siew Raymond (Non-Executive Director)
Ong Bee Pheng (Non-Executive Director)
Francis Lee Fook Wah (Independent Director)
Goh Yeow Tin (Independent Director)
COMPANY SECRETARY : Teow Xueting, Tanya, LLB (Honours)
REGISTERED OFFICE : 1 Robinson Road
#17-00
AIA Tower
Singapore 048542
PRINCIPAL PLACE OF BUSINESS : Singapore
600 North Bridge Road
Parkview Square
#12-01
Singapore 188778
PRC
Xiangliu Village
Gongxing Town
Mianzhu City
Sichuan Province
Peoples Republic of China
618205
SPONSOR AND UNDERWRITER : United Overseas Bank Limited
80 Rafes Place
UOB Plaza
Singapore 048624
PLACEMENT AGENT : Asiasons WFG Capital Pte. Ltd.
22 Cross Street
#03-54/61
China Square Central
Singapore 048421
AUDITORS OF OUR COMPANY AND
REPORTING ACCOUNTANTS
: Ernst & Young LLP
One Rafes Quay
North Tower
Level 18
Singapore 048583
Partner-in-charge: Ng Boon Heng
(Chartered Accountant, a member of the Institute of
Singapore Chartered Accountants)
2
SOLICITORS TO THE INVITATION : Shook Lin & Bok LLP
1 Robinson Road
#18-00
AIA Tower
Singapore 048542
SOLICITORS TO THE SPONSOR
AND UNDERWRITER AND THE
PLACEMENT AGENT
: Rajah & Tann LLP
9 Battery Road
#25-01
Straits Trading Building
Singapore 049910
LEGAL ADVISERS TO THE COMPANY
ON PRC LAW
: King & Wood Mallesons (Chengdu Ofce)
22nd Floor
The City Tower
86 Section One
Renminnanlu
Chengdu City
Sichuan Province
610016
LEGAL ADVISERS TO THE SPONSOR
AND UNDERWRITER AND THE
PLACEMENT AGENT ON PRC LAW
: Tian Yuan Law Firm
10th Floor
China Pacic Insurance Plaza
28 Fengsheng Hutong
Xicheng District
Beijing City
100032
INDEPENDENT GEOLOGIST : Watts, Grifs and McOuat Limited
Suite 400, 8 King Street East
Toronto, Ontario, M5C 1B5
Canada
INDEPENDENT VALUER : Jones Lang LaSalle Corporate Appraisal and
Advisory Limited
6/F Three Pacic Place
1 Queens Road East
Hong Kong
INDEPENDENT MARKET
CONSULTANT
: CRU International Limited
Chancery House
53-64 Chancery Lane
London
WC2A IQS
United Kingdom
SHARE REGISTRAR AND SHARE
TRANSFER OFFICE
: Boardroom Corporate & Advisory Services Pte. Ltd.
50 Rafes Place
Singapore Land Tower
#32-01
Singapore 048623
3
PRINCIPAL BANKER : Oversea-Chinese Banking Corporation Limited
65 Chulia Street
#06-00
OCBC Centre
Singapore 049513
RECEIVING BANK : United Overseas Bank Limited
80 Rafes Place
UOB Plaza
Singapore 048624
VENDORS : Cheong Hock @ Cheong Kim Hock
53 Cairnhill Road
#08-03
Cairnhill Plaza
Singapore 229664
Heng Kheng Long
238 Orchard Boulevard
#36-07
The Orchard Residences
Singapore 237973
Heng Kheng Ngiap
13 Nallur Road
Singapore 456615
Kiong James
19 Medway Drive
Serangoon Garden Estate
Singapore 556514
Link Well International Limited
70 Ubi Crescent
#01-11
Ubi Techpark
Singapore 408570
MIB Investments Private Limited
3 Pemimpin Drive
#06-01
Lip Hing Industrial Building
Singapore 576147
Ngo Chong Yong Calvin
78 Greenleaf View
Singapore 279313
Ngo Sio Fung Edna
78 Greenleaf View
Singapore 279313
Ong Chu Poh
30 Saraca Road
Seletar Hills Estate
Singapore 807376
4
Seacare Foundation Pte Ltd
52 Chin Swee Road
#09-00
Seacare Building
Singapore 169875
Tan Tin Yeow
105 Lentor Street
Singapore 786815
Tan Wee Hiok Allan
341 Kew Crescent
Kew Residencia
Singapore 465959
Wong Liang Kwang
40 Woo Mon Chew Road
Singapore 455115
5
DEFINITIONS
In this Offer Document and the accompanying Application Forms and, in relation to Electronic
Applications, the instructions appearing on the screens of the ATMs of Participating Banks and the
internet banking websites of the relevant Participating Banks, unless the context otherwise requires, the
following denitions apply throughout where the context so admits:
Companies within our Group

Company : AsiaPhos Limited
Group : Our Company and our subsidiaries as at the date of this Offer
Document
Mianzhu Norwest :
(Sichuan Mianzhu Norwest Phosphate Chemical Co., Ltd.)
Norwest Chemicals : Norwest Chemicals Pte. Ltd.
Other Companies and Organisations
ACRA : The Accounting and Corporate Regulatory Authority of Singapore
Advantage Link : Advantage Link International Pte. Ltd.
Astute Ventures : Astute Ventures Pte. Ltd.
Authority : The Monetary Authority of Singapore
CDP : The Central Depository (Pte) Limited
CPF : The Central Provident Fund
CRU : CRU International Limited
Dashan :
(Mianzhu Dashan Mining Co., Ltd)
DBS Bank : DBS Bank Ltd
Eastcomm : Eastcomm Pte. Ltd., an investment holding company
incorporated in Singapore, and one of our Controlling
Shareholders
HHEO : Hwa Hong Edible Oil Industries Pte. Ltd., a wholly-owned
subsidiary of Hwa Hong Corporation Limited
Hwa Hong : Hwa Hong Corporation Limited, a company listed on the
Mainboard of the SGX-ST
Hwa Hong Group : Hwa Hong Corporation Limited and its subsidiaries
IRAS : Inland Revenue Authority of Singapore
JLLCAA : Jones Lang LaSalle Corporate Appraisal and Advisory Limited
King & Wood Mallesons : King & Wood Mallesons (Chengdu Ofce)
KOF-K Kosher Supervision : KOF-K Kosher Supervision, a kosher certication agency in the
USA
6
DEFINITIONS
Link Well : Link Well International Limited
Lomon Chemicals :
(Sichuan Lomon Phosphate Chemical Co., Ltd.)
Lomon Products :
(Sichuan Lomon Phosphate Products Joint Stock Ltd. Company)
MIB Investments : MIB Investments Private Limited
Norwest Holdings : Norwest Holdings Pte. Ltd. (in liquidation pursuant to compulsory
winding up on the grounds of insolvency)
NSF International : NSF International, an independent organisation that provides
standards development, product certication, auditing, education
and risk management for public health and the environment
Participating Banks : United Overseas Bank Limited and its subsidiary, Far Eastern
Bank Limited, OCBC Bank and DBS Bank Ltd. (including POSB),
and Participating Bank means any of the abovementioned
banks
Placement Agent or Asiasons : Asiasons WFG Capital Pte. Ltd.
OCBC Bank : Oversea-Chinese Banking Corporation Limited
Seacare Foundation : Seacare Foundation Pte Ltd
SGX-ST : Singapore Exchange Securities Trading Limited
Share Registrar : Boardroom Corporate & Advisory Services Pte. Ltd.
Sponsor, Underwriter or : United Overseas Bank Limited
Sponsor and Underwriter
or UOB
WGM : Watts, Grifs and McOuat Limited
WYY Investment : WYY Investment Holdings Pte. Ltd.

PRC authorities
Town-level authority
Hanwang Government :
(Hanwang Town Peoples Government)

County-level authorities
Mianzhu Construction Bureau :
(Mianzhu City Housing and Urban Construction Bureau)

Mianzhu Environmental Bureau :
(Mianzhu City Environmental Protection Bureau)
Mianzhu Finance Bureau :
(Mianzhu City Finance Bureau)
7
DEFINITIONS
Mianzhu Land Bureau :
(Mianzhu City Land and Resources Bureau)
Mianzhu Local Tax Bureau :
(Mianzhu City Local Tax Bureau)
Mianzhu Planning Bureau :
(Mianzhu City Planning Bureau)
Mianzhu Resettlement Ofce :
(Mianzhu City Land Acquisition and Resettlement Ofce)
Mianzhu Safety Bureau :
(Mianzhu City Administration Bureau of Work Safety)
Mianzhu Social Insurance :
Bureau (Mianzhu City Social Insurance Administration Bureau)
Mianzhu State Tax Bureau :
(Mianzhu City State Tax Bureau)
Prefecture-level authorities
Deyang AIC Bureau :
(Deyang Administration of Industry and Commerce Bureau)
Deyang Commerce Bureau :
(Deyang City Commerce Bureau, formerly known as
(Deyang City Foreign Trade and Economic
Co-operation Bureau))
Deyang Forestry Bureau :
(Deyang City Forestry Bureau)
Deyang Forex Bureau :
(Deyang City Foreign Exchange Administration Bureau)
Provincial-level authorities
Sichuan Commerce :
Department (Sichuan Province Commerce Department, formerly known as
(Sichuan Foreign Trade and
Economic Co-operation Committee))
Sichuan Development :
Commission (Sichuan Province Development and Reform Commission)
Sichuan Government :
(Sichuan Province Peoples Government)
Sichuan Land Department :
(Sichuan Province Land and Resources Department)
Sichuan Safety Bureau :
(Sichuan Province Administration Bureau of Work Safety)
8
DEFINITIONS
Other authorities
Hong Kong SAR Mainland :
Affairs Bureau (Constitutional and Mainland Affairs Bureau of the Government of
the Hong Kong Special Administrative Region)
SAFE :
(The State Administration for Foreign Exchange of the PRC)

General
Application Forms : The ofcial printed application forms to be used for the purpose
of the Invitation, which form part of this Offer Document
Application List : The list of applications to subscribe for the Invitation Shares
Articles or Articles of : Articles of association of our Company
Association
AsiaPhos Performance Share : The performance share plan of our Company
Plan or Performance Share
Plan
ATM : Automated teller machine
Audit Committee : The audit committee of our Company as at the date of this Offer
Document
Board or Board of Directors : The board of Directors of our Company as at the date of this
Offer Document
Catalist : The sponsor-supervised listing platform of the SGX-ST
Catalist Rules : Listing Manual Section B: Rules of Catalist of the Listing Manual
of the SGX-ST, as amended, supplemented, or modied from
time to time
CEO : Chief Executive Ofcer
Code of Corporate Governance : The Code of Corporate Governance 2012 of Singapore, as
or Code amended, supplemented or modied from time to time
Companies Act : The Companies Act (Chapter 50) of Singapore, as amended,
supplemented or modied from time to time
CRU Industry Report : The independent industry report dated 21 June 2013 prepared by
CRU on the phosphate industry, as set out in Appendix L to this
Offer Document
Deed of Indemnity : The deed of indemnity dated 21 June 2013 pursuant to which
Ong Kwee Eng, Dr. Ong Hian Eng, Wang Xuebo and Chia Chin
Hau have jointly and severally undertaken, inter alia, to indemnify
and hold harmless our Group against losses in connection with
(i) certain land use rights which may be required in connection
with Mianzhu Norwests Mining Operations for a period of 18
months from the date of the Companys admission to Catalist; (ii)
land use rights for Phase 2 Land; and (iii) the requisite licences,
permits and approvals for Commercial Chemical Production
Operations on Phase 2 Land
9
DEFINITIONS
Directors : The directors of our Company as at the date of this Offer
Document
Electronic Applications : Applications for the Offer Shares made through an ATM or
through IB websites of the relevant Participating Banks, subject
to and on the terms and conditions of this Offer Document
EPS : Earnings per Share
Executive Directors : The executive directors of our Company as at the date of this
Offer Document
FP : The three (3) months nancial period ended, or as the case may
be, ending, 31 March
FY : Financial year ended or, as the case may be, ending, 31 December
GDP : Gross domestic product
GST : Goods and services tax
Hanwang Land : The land located in Hanwang New Town, Mianzhu City, Sichuan
Province, the PRC, of approximately 4,973 sq m
IB : Internet banking
IB Application : An application for Offer Shares made through an IB website of a
Participating Bank in accordance with the terms and conditions of
this Offer Document
Independent Directors : The independent directors of our Company as at the date of this
Offer Document
Independent Valuation Report : The valuation report dated 27 August 2013 prepared by JLLCAA
relating to the independent valuation of the fair market value of
the Mines and the P
4
Plant, as set out in Appendix K to this Offer
Document
Investment Agreements : The investment agreements and supplemental letters entered
into by Eastcomm with the Noteholders in 2010, 2012 and 2013
Invitation : The Offer and the Placement
Invitation Price : S$0.25 for each Invitation Share
Invitation Shares : The 122,000,000 Shares which are the subject of this Invitation,
comprising 97,600,000 New Shares and 24,400,000 Vendor
Shares
Key Executives : The key executives of our Group as at the date of this Offer
Document
Latest Practicable Date : 15 August 2013, being the latest practicable date prior to the
lodgment of this Offer Document with the SGX-ST acting as
agent on behalf of the Authority
Legal Representative : (legal representative), a person appointed as a legal
representative of a PRC company under applicable PRC laws,
rules and regulations
10
DEFINITIONS
Management and Underwriting : The management and underwriting agreement dated 25
Agreement September 2013 entered into between our Company, the
Vendors, and the Sponsor and Underwriter, relating to the
Invitation
Market Day : A day on which the SGX-ST is open for trading in securities
Mian Mao Highway : (Mian Mao Highway), the highway to be constructed
jointly by the Sichuan Development Commission and the Hong
Kong SAR Mainland Affairs Bureau, which upon completion is
expected to run from Mianzhu City to (Mao County),
(Aba Tibetan and Qiang Autonomous Prefecture),
Sichuan Province, the PRC
Mine 1 : The (Cheng Qiang
Yan phosphate mine), located in Qing Ping Town, Mianzhu City,
Sichuan Province, the PRC, details of which are set out in the
section entitled General Information on our Group Mining
Operations of this Offer Document
Mine 2 : The (Shi Sun Xi
phosphate mine), located in Qing Ping Town, Mianzhu City,
Sichuan Province, the PRC, details of which are set out in the
section entitled General Information on our Group Mining
Operations of this Offer Document
Mines : Mine 1 and Mine 2 collectively
NAV : Net asset value
New Gongxing Facilities : Our new facilities for our Chemical Production Operations located
at the New Gongxing Site
New Gongxing Site : Our new land premises located at Xiangliu Village, Gongxing
Town, Mianzhu City, Sichuan Province, the PRC, comprising
Phase 1 Land and Phase 2 Land
New Shares : The 97,600,000 new Shares for which our Company invites
applications to subscribe for pursuant to the Invitation, subject to
and on the terms and conditions of this Offer Document
Nominating Committee : The nominating committee of our Company as at the date of this
Offer Document
Noteholders : The holders of convertible loan notes issued by Eastcomm
pursuant to the terms and conditions set out in the Investment
Agreements
Notes : The convertible loan notes in the aggregate principal amount of
S$27,000,000 issued by Eastcomm to the Noteholders pursuant
to the Investment Agreements
NTA : Net tangible assets
Offer : The offer by our Company and the Vendors to the public in
Singapore for subscription and/ or purchase of the Offer Shares
at the Invitation Price, subject to and on the terms and conditions
of this Offer Document
11
DEFINITIONS
Offer Document : This offer document dated 25 September 2013 issued by our
Company and the Vendors in respect of the Invitation, including
the Appendices hereto and the Application Forms
Offer Shares : The 2,000,000 Invitation Shares which are the subject of the
Offer
P
4
Plant : The plant located at the New Gongxing Site which manufactures
and produces P
4
Period Under Review : FY2010, FY2011, FY2012 and FP2013
Phase 1 : The rst phase of our Rebuilding Programme
Phase 2 : The second phase of our Rebuilding Programme

Phase 1 Land : The land located at Xiangliu Village, Gongxing Town, Mianzhu
City, Sichuan Province, the PRC, which forms part of the New
Gongxing Site, of approximately 54,863 sq m
Phase 2 Land : The land located at Xiangliu Village, Gongxing Town, Mianzhu
City, Sichuan Province, the PRC, which forms part of the New
Gongxing Site, of approximately 138.63Mu (approximately 92,425
sq m)
Placement : The placement of the Placement Shares at the Invitation Price
by the Placement Agent on behalf of our Company and the
Vendors, subject to and on the terms and conditions of this Offer
Document
Placement Agreement : The placement agreement dated 25 September 2013 entered
into between our Company, the Vendors and the Placement
Agent relating to the Placement
Placement Shares : The 120,000,000 Invitation Shares which are the subject of the
Placement
PRC or China : Peoples Republic of China. Unless the context requires,
references in this Offer Document to the PRC or China do not
include Hong Kong, Macau or Taiwan
Previous Hanwang Facilities : The facilities for our Chemical Production Operations, located at
Hanwang Town, Mianzhu City, Sichuan Province, the PRC, prior
to the Wenchuan Earthquake and the Relocation Exercise
Rebuilding Programme : The construction of facilities for our Chemical Production
Operations and ofces at the New Gongxing Site following the
Wenchuan Earthquake and the Relocation Exercise
Relocation Exercise : The relocation of our Chemical Production Operations from the
Previous Hanwang Facilities to the New Gongxing Site pursuant
to the request of local PRC authorities following the Wenchuan
Earthquake
Remuneration Committee : The remuneration committee of our Company as at the date of
this Offer Document
12
DEFINITIONS
Restructuring Agreement : The restructuring agreement dated 19 June 2013 entered into
between our Company, Eastcomm, Ong Kwee Eng, Chia Chin
Hau, Dr. Ong Hian Eng, and Wang Xuebo, pursuant to which our
Company acquired the entire issued and paid-up share capital of
Norwest Chemicals from Eastcomm. Please refer to the section
entitled Restructuring Exercise of this Offer Document for
further details
Restructuring Exercise : The restructuring exercise carried out in connection with
the Invitation, more fully described in the section entitled
Restructuring Exercise of this Offer Document
Securities Account : The securities account maintained by a depositor with the CDP
and does not include a securities sub-account
Service Agreements : The service agreements entered into between our Company
and (i) each of our Executive Directors; and (ii) Wang Xuebo, our
Key Executive. Please refer to the section entitled Management
and Corporate Governance - Service Agreements of this Offer
Document for further details
SFA : Securities and Futures Act (Chapter 289) of Singapore, as
amended, supplemented or modied from time to time
SFR : Securities and Futures (Offer of Investments) (Shares and
Debentures) Regulations 2005, as amended, supplemented or
modied from time to time
SFRS : Singapore Financial Reporting Standards
SGXNET : The system maintained by the SGX-ST for announcements by
listed companies
Shareholders : Registered holders of Shares, except where the registered holder
is CDP, the term Shareholders shall, in relation to such Shares
mean the depositors whose Securities Accounts are credited with
Shares
Shares : The ordinary shares in the capital of our Company
USA : The United States of America
Vendor Shares : The 24,400,000 issued and fully paid-up Shares for which the
Vendors invite applications to purchase on the terms and subject
to the conditions set out in this Offer Document
Vendors : (i) Cheong Hock @ Cheong Kim Hock; (ii) Heng Kheng Long;
(iii) Heng Kheng Ngiap; (iv) Kiong James; (v) Link Well; (vi) MIB
Investments; (vii) Ngo Chong Yong Calvin; (viii) Ngo Sio Fung
Edna; (ix) Ong Chu Poh; (x) Seacare Foundation; (xi) Tan Tin
Yeow; (xii) Tan Wee Hiok Allan; and (xiii) Wong Liang Kwang
Wenchuan Earthquake : The earthquake that occurred in Wenchuan County, Sichuan
Province, the PRC on 12 May 2008, which measured 8.0 on the
Richter magnitude scale
13
DEFINITIONS
WGM Technical Report : The independent technical report dated 28 February 2013
prepared by WGM in accordance with NI 43-101 relating to the
Mines as set out in Appendix J to this Offer Document
Currencies, Units and Others
C : Degrees centigrade
m : Metre
Mu : 1 (mu) equals approximately 666.67 sq m
RMB : The PRC Renminbi
sq ft : Square foot
sq km : Square kilometre
sq m : Square metre
US$ or USD : USA dollars
$, S$ or SGD and cent : Singapore dollars and cents, respectively
% or per cent. : Per centum or percentage
All references to Francis Lee in this Offer Document shall be a reference to Francis Lee Fook Wah.
All references to Melissa Ong in this Offer Document shall be a reference to Ong Bee Kuan Melissa.
All references to Rachel Goh in this Offer Document shall be a reference to Goh Cheng Kiat.
All references to Raymond Ong in this Offer Document shall be a reference to Ong Eng Siew Raymond.
All references to Simon Ong in this Offer Document shall be a reference to Ong Eng Hock Simon.
Certain Chinese names and characters, such as those of PRC entities, properties, cities, governmental
and regulatory departments, laws and regulations and notices, have been translated into English, solely
for your convenience, and such translations should not be construed as representations that the English
names actually represent the Chinese names and characters.
The expressions Associate, associated company, associated entity, controlling interest-holder,
Controlling Shareholder, related corporation, related entity, Entity At Risk, Interested Person,
Interested Person Transaction, subsidiary, subsidiary entity, substantial interest-holder and
Substantial Shareholder shall have the meanings ascribed to them respectively in the SFA, the SFR, the
Companies Act and/ or the Catalist Rules, as the case may be.
The expressions the Group, our, ourselves, us, we or other grammatical variations thereof shall,
unless otherwise stated, mean our Company, our Group or any member of our Group, as the context
requires.
The terms depositor, depository agent and depository register shall have the meanings ascribed to
them respectively in Section 130A of the Companies Act.
Words importing the singular shall, where applicable, include the plural and vice versa and words
importing the masculine gender shall, where applicable, include the feminine and neuter genders and
vice versa. References to persons shall include corporations.
14
DEFINITIONS
Any discrepancies in tables, graphs and/ or charts included herein between the amounts listed and the
totals thereof are due to rounding. Accordingly, gures shown as totals in certain tables may not be an
arithmetic aggregation of the gures which precede them. Where applicable, gures and percentages are
rounded off.
Any reference in this Offer Document, the Application Forms and Electronic Applications to any statute
or enactment is a reference to that statute or enactment for the time being amended or re-enacted.
Any word dened in the Companies Act, the SFA, the SFR or the Catalist Rules and used in this Offer
Document, the Application Forms or Electronic Applications, shall, where applicable, have the meaning
ascribed to it under the Companies Act, the SFA, the SFR, or the Catalist Rules, as the case may be.
Any reference in this Offer Document, the Application Forms or Electronic Applications to our Shares
being allotted and/ or allocated to an applicant includes allotment and/ or allocation to the CDP for the
account of that applicant.
Any reference to a time or date in this Offer Document, the Application Forms or Electronic Applications
shall be a reference to Singapore time or date respectively unless otherwise stated.
15
GLOSSARY OF TECHNICAL TERMS
To facilitate a better understanding of our business, the following glossary provides an explanation of
some of the technical terms and abbreviations used in this Offer Document. The terms and their assigned
meanings may not correspond to standard industry or common meanings or usage (as the case may be):
adit or well : An entrance to an underground mine which is horizontal or
nearly horizontal, by which the mine can be entered, drained of
water and/ or ventilated.
Chemical Production Operations : The production of phosphate-based chemical products by
Mianzhu Norwest.
Prior to the Wenchuan Earthquake, we produced P
4
, STPP and
SHMP. As at the Latest Practicable Date, we have received the
requisite approvals, licences, permits and authorisations and
are currently conducting Trial Chemical Production Operations
for Phase 1 of the Rebuilding Programme.
Commercial Chemical Production : The production of phosphate-based chemical products by
Operations Mianzhu Norwest after obtaining the requisite approvals,
licences, permits and authorisations.
Commercial Mining Operations : The mining of phosphate rocks at our Mines by Mianzhu
Norwest after obtaining the requisite approvals, licences,
permits and authorisations. As at the Latest Practicable Date,
Mianzhu Norwest is carrying out Commercial Mining Operations
in Mine 1 pursuant to the Commercial Mining Notication.
Commercial Mining Notication :
(Notice regarding approval of the
resumption of production of Cheng Qiang Yan phosphate mine
of Sichuan Mianzhu Norwest Phosphate Chemical Co., Ltd.
issued by Mianzhu City Administration Bureau of Work Safety),
a notication from the Mianzhu Safety Bureau dated 5 March
2013, pursuant to which Mianzhu Norwest was permitted to
commence Commercial Mining Operations in Mine 1.
deposit : An area of resources or reserves identied by surface mapping,
drilling or development.
exploration : The search for mineral, including prospecting, sampling,
mapping, drilling and other work involved in the search for
mineralisation.
indicated mineral resource : According to the NI 43-101, it is that part of a mineral resource

for which quantity, grade or quality, densities, shape and
physical characteristics, can be estimated with a level of
condence sufcient to allow the appropriate application of
technical and economic parameters, to support mine planning
and evaluation of the economic viability of the deposit. The
estimate is based on detailed and reliable exploration and
testing information gathered through appropriate techniques
from locations such as outcrops, trenches, pits, workings and
drill holes that are spaced closely enough for geological and
grade continuity to be reasonably assumed.
16
inferred mineral resource : According to the NI 43-101, it is that part of a mineral resource

for which quantity and grade or quality can be estimated on
the basis of geological evidence and limited sampling and
reasonably assumed, but not veried, geological and grade
continuity. The estimate is based on limited information and
sampling gathered through appropriate techniques from
locations such as outcrops, trenches, pits, workings and drill
holes.
ISO : International Organization for Standardization, a worldwide
federation of national standard bodies.
ISO 9001 : A constituent part of the ISO 9000 series which specifies
the requirements for a quality management system for
any organisation that needs to demonstrate its ability to
consistently provide products that meet customer and applicable
requirements and aim to enhance customer satisfaction.
ISO 14001 : A constituent part of the ISO 14000 series which represents the
core set of standards used by organisations for designing and
implementing an effective environmental management system.
Kosher : Indicates conformity to the regulations of the Jewish Halakhic
law framework.
lode : Geologically, a deposit of metalliferous ore that fills or is
embedded in a ssure in a rock formation, or a vein of ore that
is deposited or embedded between layers of rock.
measured mineral resource : According to the NI 43-101, it is that part of a mineral resource

for which quantity, grade or quality, densities, shape, and
physical characteristics are so well established that they can
be estimated with sufcient condence to allow the appropriate
application of technical and economic parameters, to support
production planning and evaluation of the economic viability
of the deposit. The estimate is based on detailed and reliable
exploration, sampling and testing information gathered
through appropriate techniques and testing information
gathered through appropriate techniques from locations such
as outcrops, trenches, pits, workings and drill holes that are
spaced closely enough to conrm both geological and grade
continuity.
mineral reserve : According to the NI 43-101, it is the economically mineable part
of a measured or indicated mineral resource demonstrated by
at least a preliminary feasibility study. This study must include
adequate information on mining, processing, metallurgical,
economic and other relevant factors that demonstrate, at the
time of reporting, that economic extraction can be justied. A
mineral reserve includes diluting materials and allowances for
losses that may occur when the material is mined.
mineral resource : According to the NI 43-101, it is a concentration or occurrence
of diamonds, natural solid inorganic, or natural solid fossilised
organic material including base and precious metals, coal, and
industrial minerals in or on the Earths crust in such form and
17
quantity and of such a grade or quality that it has reasonable
prospects for economic extraction. The location, quantity, grade,
geological characteristics and continuity of a mineral resource
are known, estimated or interpreted from specic geological
evidence and knowledge.
Mining Operations : The mining of phosphate rocks at our Mines.
NI 43-101 : National Instrument 43-101 (Standards of Disclosure for Mineral
Projects), a codified set of rules and guidelines for public
disclosure of scientic and technical information about mineral
projects owned by, or explored by, companies which report
these results on stock exchanges within Canada and which is
one of the standards of reporting prescribed by the SGX-ST in
respect of mineral, oil and gas companies.
plant : Fixed or moveable equipment used in our Chemical Production
Operations.
phosphate : An inorganic chemical which is mined to obtain phosphorus for
further industrial applications including agriculture and industrial
chemicals.
phosphate-based chemical : The phosphate-based chemical products which may be
products manufactured by our Chemical Production Operations, including
P
4
, STPP and SHMP.
phosphorite or phosphate rock : A phosphate-bearing sedimentary rock with a sufciently high
content of phosphate minerals to be of economic interest.
phosphorus : Chemical element that has the symbol P and atomic number 15.
preliminary feasibility study : A comprehensive study of the viability of a mineral project
that has advanced to a stage where the mining method, in
the case of underground mining, or the pit conguration in the
case of an open pit, has been established, and which, if an
effective method of mineral processing has been determined,
includes a nancial analysis based on reasonable assumptions
of technical, engineering, operating, economic factors and the
evaluation of other relevant factors which are sufcient for a
qualied person, acting reasonably, to determine if all or part of
the mineral resource may be classied as a mineral reserve.
P
2
O
5
: A chemical compound known as phosphorus pentoxide.
P
4
: A chemical compound known as tetraphosphorus, otherwise
known as yellow phosphorus.
SHMP : A chemical compound known as sodium hexametaphosphate.
silo : A structure for storing materials.
stope : An open space left after the removal of ore from an
underground mine.
STPP : A chemical compound known as sodium triphosphate or sodium
tripolyphosphate.
18
Trial Chemical Production : The trial production of phosphate-based chemical products
Operations by Mianzhu Norwest after obtaining the requisite approvals,
licences, permits and authorisations.
Trial Mining Operations : The mining of phosphate rocks in Mine 2 by Mianzhu Norwest
pursuant to the Trial Mining Notications.
Trial Mining Notications :
(Notice regarding
approval of the resumption of trial production of Cheng Qiang
Yan phosphate mine and Shi Sun Xi phosphate mine of
Sichuan Mianzhu Norwest Phosphate Chemical Co., Ltd issued
by Mianzhu City Administration Bureau of Work Safety), a
notication from Mianzhu Safety Bureau dated 8 March 2012
and
(Notice regarding approval
of the resumption of trial production of Shi Sun Xi phosphate
mine of Sichuan Mianzhu Norwest Phosphate Chemical Co.,
Ltd issued by Mianzhu City Administration Bureau of Work
Safety), a notication from Mianzhu Safety Bureau dated 2 July
2013, pursuant to which Mianzhu Norwest was permitted to
commence Trial Mining Operations in our Mines.
VALMIN Code : Code for the Technical Assessment and Valuation of Mineral
and Petroleum Assets and Securities for Independent Expert
Reports 2005 Edition, prepared by the joint committee of the
Australasian Institute of Mining and Metallurgy, the Australian
Institute of Geoscientists and the Mineral Industry Consultants
Association, with the participation of the Australian Securities
and Investment Commission, the Australian Stock Exchange
Limited, the Minerals Council of Australia, the Petroleum
Exploration Society of Australia, the Securities Association of
Australia and representatives from the Australian nance sector.
19
SELLING RESTRICTIONS
This Offer Document does not constitute an offer, solicitation or invitation to subscribe for and/ or
purchase the Invitation Shares in any jurisdiction in which such offer, solicitation or invitation is unlawful
or is not authorised or to any person to whom it is unlawful to make such an offer, solicitation or invitation.
No action has been or will be taken under the requirements of the legislation or regulations of, or of the
legal or regulatory authorities of, any jurisdiction, except for the lodgment and/ or registration of this Offer
Document in Singapore in order to permit an offering of the Invitation Shares and the distribution of this
Offer Document in Singapore. The distribution of this Offer Document and the offering of the Invitation
Shares in certain jurisdictions may be restricted by the relevant laws in such jurisdictions. Persons
who may come into possession of this Offer Document are required by our Company, the Vendors, the
Sponsor and Underwriter, and the Placement Agent, to inform themselves about, and to observe and
comply with, any such restrictions at their own expense and without liability to our Company, the Vendors,
the Sponsor and Underwriter, or the Placement Agent. Persons to whom a copy of this Offer Document
has been issued shall not circulate to any other person, reproduce or otherwise distribute this Offer
Document or any information herein for any purpose whatsoever nor permit or cause the same to occur.
20
CAUTIONARY NOTES REGARDING FORWARD-LOOKING STATEMENTS
All statements contained in this Offer Document, statements made in press releases and oral statements
that may be made by us, the Vendors, our Directors, Key Executives or employees acting on our behalf,
that are not statements of historical fact, constitute forward-looking statements. You can identify some
of these statements by forward-looking terms such as anticipate, believe, could, estimate, expect,
intend, seek, project, may, plan, will and would or similar words. However, you should note
that these words are not the exclusive means of identifying forward-looking statements. All statements
regarding our expected nancial position, business strategies, plans and prospects are forward-looking
statements.
These forward-looking statements, including without limitation, statements as to:
our revenue and protability;
projections of capital expenditures in general and other nancial items;
our planned expansion and whether we can successfully execute, manage and/ or implement it;
any expected growth;
other expected industry trends; and
anticipated completion of proposed plans and other matters discussed in this Offer Document
regarding matters that are not historical facts,
are only predictions. Forward-looking statements reflect our current views with respect to future
events and are not a guarantee of future performance. These statements are based on our beliefs
and assumptions, which in turn are based on currently available information. Although we believe
the assumptions upon which these forward-looking statements are based are reasonable, any of
these assumptions could prove to be inaccurate, and the forward-looking statements based on these
assumptions could be incorrect.
These forward-looking statements involve known and unknown risks, uncertainties and other factors that
may cause our actual results, performance or achievements to be materially different from any future
results, performance or achievements expressed or implied by such forward-looking statements. These
risks, uncertainties and other important factors include, in no particular order of priority and amongst
others, the following:
changes in political, social and economic conditions and the regulatory environment in the places
in which we conduct our business;
war or acts of international or domestic terrorism;
occurrences of natural disasters, catastrophic events, outbreaks of communicable diseases and
acts of God that affect our business or properties;
changes in government regulations and their interpretation, including mining laws, tax laws,
property laws and foreign investment laws;
our anticipated growth strategies and expected internal growth;
changes in customer demand or preferences;
changes in competitive conditions and our ability to compete under these conditions;
changes in our senior management team or loss of key employees;
changes in labour relations;
changes relating to and our relations with the Controlling Shareholders;
changes in currency exchange rates;
the availability of adequate insurance at reasonable cost;
the availability and cost of labour, building and construction materials, including the ability to secure
materials and subcontractors;
21
CAUTIONARY NOTES REGARDING FORWARD-LOOKING STATEMENTS
changes in the costs associated with environmental, health and safety and security measures;
construction risks including changes in project costs, delays in completion of projects, delays in
obtaining approvals from the relevant authorities and other unforeseen circumstances;
changes in our future capital needs and the availability of nancing and capital to fund these needs;
the ability of third parties to honour their commitments;
the ability of our co-operation or joint venture partners to honour their commitments;
any other matters not yet known to us;
other factors beyond our control; and
the factors described in the section entitled Risk Factors of this Offer Document.
Additional factors that could cause actual results, performance or achievements to differ materially
include, but are not limited to those discussed under the sections entitled Risk Factors, Dividend
Policy, General Information on our Group Business Overview, General Information on our Group
Business Strategies and Future Plans, and Managements Discussion and Analysis of Results of
Operations and Financial Position of this Offer Document, and all forward-looking statements made by
or attributable to us, the Vendors, the Sponsor and Underwriter, the Placement Agent, and/ or persons
acting on our behalf, contained in this Offer Document, are expressly qualied in their entirety by
such factors. Given the risks and uncertainties that may cause our actual future results, performance
or achievements to be materially different than expected, expressed or implied by the forward-looking
statements in this Offer Document, investors are cautioned not to place undue reliance on those
statements. None of our Company, the Vendors, the Sponsor and Underwriter, the Placement Agent or
any other person are representing or warranting to you that our actual future results, performance or
achievements will be as discussed in those statements.
The WGM Technical Report, the Independent Valuation Report and the CRU Industry Report contain
data, information, nancial analysis, forecast, gures and statements (including market and industry data
and forecasts that have been obtained from internal surveys, reports and studies, where appropriate,
as well as market research, publicly available information and industry publications) which are forward-
looking and based on certain assumptions and projections. Industry publications, surveys and forecasts
generally state that the information they contain has been obtained from sources believed to be reliable,
but there can be no assurance as to the accuracy or completeness of such information. Neither we,
the Vendors, the Sponsor and Underwriter, the Placement Agent, nor person(s) acting on our behalf
have conducted an independent review or veried the accuracy or veracity of such data, information,
nancial analysis, forecast, gures and statements, assumptions and projections (the Experts Data).
No representation is made by us, the Vendors, the Sponsor and Underwriter, the Placement Agent or
any person acting on our behalf in respect of any of the Experts Data and neither we, the Vendors, the
Sponsor and Underwriter, nor the Placement Agent take any responsibility for any of the Experts Data.
Further, our Company, the Vendors, the Sponsor and Underwriter, and the Placement Agent, disclaim any
responsibility to update any of those forward-looking statements to reect future developments, events
or circumstances for any reason, even if new information becomes available or other events occur in
the future. We and the Vendors are, however, subject to the provisions of the SFA, SFR and the Catalist
Rules regarding corporate disclosure. In particular, pursuant to Section 241 of the SFA, if after the Offer
Document is registered but before the close of the Invitation, we and the Vendors become aware of (i) a
false or misleading statement or matter in the Offer Document; (ii) an omission from the Offer Document
of any information that should have been included in it under the SFA, SFR or the Catalist Rules; or (iii)
a new circumstance that has arisen since the Offer Document was lodged with the SGX-ST acting as
agent on behalf of the Authority, and would have been required by the SFA, SFR or the Catalist Rules
to be included in the Offer Document, if it had arisen before the Offer Document was lodged, and that is
materially adverse from the point of view of an investor, we and the Vendors may lodge a supplementary
or replacement offer document with the SGX-ST acting as agent on behalf of the Authority.
22
OFFER DOCUMENT SUMMARY
The information contained in this summary is derived from and should be read in conjunction with the full
text of this Offer Document. Terms dened elsewhere in this Offer Document have the same meanings
when used herein. Prospective investors should read the entire Offer Document carefully, in particular the
matters set out in the section entitled Risk Factors and our nancial statements and related notes of this
Offer Document, before making an investment decision.
OVERVIEW OF OUR GROUP
We are the rst mineral resources company to be listed on the SGX-ST which is solely focused on
exploring and mining phosphate in the PRC with the ability to manufacture and produce phosphate-based
chemical products.
We were incorporated in Singapore under the Singapore Companies Act on 3 January 2012 with the
name AsiaPhos Private Limited, as a private company limited by shares. On 6 September 2013, we were
converted into a public company limited by shares and changed our name to AsiaPhos Limited.
We are currently headquartered in Singapore, and possess the rights to explore and mine phosphate in
Sichuan Province, PRC. Prior to the Wenchuan Earthquake, we were engaged in a vertically-integrated
production process involving (i) our Mining Operations; and (ii) our Chemical Production Operations.
We currently own mining and exploration rights to our Mines, which are located approximately 40 km
northwest of the New Gongxing Site. Currently, we have two (2) Mines which are producing phosphate
rocks. Between 2002 and the Wenchuan Earthquake, we obtained approximately 379,000 tonnes of
phosphate rocks from Mine 1. For FY2005, FY2006 and FY2007, we obtained approximately 62,000,
71,000 and 89,000 tonnes of phosphate rocks respectively from our Mines.
We have completed the construction of our P
4
Plant at the New Gongxing Site under Phase 1 of the
Rebuilding Programme in preparation for the resumption of our Chemical Production Operations. We
are currently in the preliminary stages of Phase 2 of the Rebuilding Programme, which involves the
construction of, inter alia, (i) a thermal phosphoric acid plant; and (ii) a food grade and non food grade
SHMP plant. As part of Phase 2 of the Rebuilding Programme, we have also temporarily relocated our
STPP equipment, machinery and storage facilities from the Previous Hanwang Facilities to the New
Gongxing Site.
Our Group comprises our Company and our subsidiaries, Norwest Chemicals and Mianzhu Norwest.
Uses of Phosphates
Phosphate is a valuable and non-renewable natural resource, and has numerous commercial and
industrial applications. The root element, phosphorus, is an important nutrient for human, animal and
plant life.
Phosphorus, phosphates and phosphate-based chemical products are used in, or in the manufacturing
processes for, many everyday products, including: fertilisers and animal feed, explosives, re retardants,
food and beverage products, batteries, ceramics, detergents and cleaning products, and lubricants for
industrial applications.
OUR COMPETITIVE STRENGTHS
Our Directors consider the following to be our core competitive strengths:
Our phosphate rocks are of relatively higher quality than other phosphate rocks mined in the PRC
We benet from relatively lower production costs
Our Mines and the New Gongxing Site are located close to each other and our customers
We have an experienced management team

Please refer to the section entitled General Information on our Group Competitive Strengths of this
Offer Document for further details.
23
OUR BUSINESS STRATEGIES AND FUTURE PLANS
Our business strategies and future plans are as follows:
Further Mining Operations and exploration activities to increase phosphorite resources and output
Adopting a vertically-integrated strategy
Rebuilding, enhancing and increasing the capacity of our Chemical Production Operations
Increasing our portfolio of phosphate-based chemical products
Expanding through acquisitions, joint ventures and strategic alliances
A detailed discussion of our business strategies and future plans is set out in the section entitled General
Information on our Group Business Strategies and Future Plans of this Offer Document.
OUR FINANCIAL PERFORMANCE
The following table presents a summary of the combined nancial statements of our Group and should be
read in conjunction with the full text of this Offer Document.
Selected items from the Combined Statements of Comprehensive Income
Audited Audited Audited Unaudited Unaudited
($000) FY2010 FY2011 FY2012 FP2012 FP2013
Revenue 2,775 4,522 4,897 1,004 1,310
Gross prot 402 2,374 2,101 356 445
Other income 981 2,535 3,538 1,361 8
(Loss)/ prot before tax (1,206) 2,933 1,509 1,174 (749)
Taxation 28 (284)
(Loss)/ prot for the year/ period attributable to
owners of the Company (1,178) 2,933 1,225 1,174 (749)
Total comprehensive (loss)/ income for
the year/ period attributable to owners of
the Company (1,279) 3,468 307 726 (384)
24
Selected items from the Combined Balance Sheet
Audited Audited Audited Unaudited
($000)
as at 31
December
2010
as at 31
December
2011
as at 31
December
2012
as at 31
March
2013
Non-current assets 6,666 22,978 33,188 32,888
Current assets 3,605 7,455 10,401 9,547
Total assets 10,271 30,433 43,589 42,435
Current liabilities 6,594 11,183 12,271 9,604
Non-current liabilities 2,343 2,448 2,709 2,760
Total liabilities 8,937 13,631 14,980 12,364
Net assets 1,334 16,802 28,609 30,071
Share capital 9,048 21,048 32,548 34,394
Reserves (7,714) (4,246) (3,939) (4,323)
Total equity 1,334 16,802 28,609 30,071
OUR CONTACT DETAILS
Our registered address is 1 Robinson Road, #17-00, AIA Tower, Singapore 048542.
Our principal place of business in Singapore is 600 North Bridge Road, Parkview Square, #12-01,
Singapore 188778. Our telephone and fax numbers are +65 6292 3119 and +65 6292 3122 respectively.
Our principal place of business in the PRC is Xiangliu Village, Gongxing Town, Mianzhu City, Sichuan
Province, PRC 618205. Our telephone and fax numbers are +86 838 626 9858 and +86 838 626 9802
respectively.
Our Companys registration number is 201200335G.
Our website address is http://www.asiaphos.com. The information on our website or any website directly
or indirectly linked to our website or the websites of any of our related corporations or other entities in
which we may have an interest is not incorporated by reference into this Offer Document and should not
be relied on.
25
DETAILS OF THE INVITATION
LISTING ON CATALIST
The Sponsor has, on our behalf, made an application to the SGX-ST for permission to list and deal in,
and for quotation of, all our Shares already issued (including the Vendor Shares), the New Shares and
the Shares which may be issued pursuant to the AsiaPhos Performance Share Plan, on Catalist. Such
permission will be granted when we have been admitted to Catalist. Acceptances of applications and the
allotment and allocation of the Invitation Shares will be conditional upon the completion of the Invitation,
which is subject to certain conditions, including the SGX-ST granting permission to list and deal in, and
for quotation of, all our existing issued Shares (including the Vendor Shares), the New Shares and the
Shares which may be issued pursuant to the AsiaPhos Performance Share Plan, on Catalist.
If the completion of the Invitation does not occur, or the said permission from the SGX-ST is not granted
for any reason, monies paid in respect of any application accepted will be returned to you at your own
risk, without interest or any share of revenue or other benet arising therefrom and you will not have
any claim against our Company, the Vendors, the Sponsor and Underwriter, or the Placement Agent. No
Shares will be allotted or allocated on the basis of this Offer Document later than six (6) months after the
date of registration of this Offer Document by the SGX-ST, acting as agent on behalf of the Authority.
Companies listed on Catalist may carry higher investment risk when compared with larger or more
established companies listed on the SGX-ST Mainboard. In particular, companies may list on Catalist
without a track record of protability and there is no assurance that there will be a liquid market in
the shares or units of shares traded on Catalist. You should be aware of the risks of investing in such
companies and should make the decision to invest only after careful consideration and, if appropriate,
consultation with your professional adviser(s).
Neither the Authority nor the SGX-ST has examined or approved the contents of this Offer Document,
or assumes any responsibility for the contents of this Offer Document, including the correctness of any
of the statements made, reports contained or opinions expressed in this Offer Document. A copy of this
Offer Document together with copies of the Application Forms have been lodged with and registered by
the SGX-ST acting as agent on behalf of the Authority. Registration of this Offer Document by the SGX-
ST acting as agent on behalf of the Authority does not imply that the SFA, or any other legal or regulatory
requirements, have been complied with. Our eligibility to list and admission to Catalist are not to be taken
as an indication of the merits of the Invitation, our Company, our subsidiaries, our existing issued Shares
(including the Vendor Shares), the New Shares or the Shares which may be issued pursuant to the
AsiaPhos Performance Share Plan. The SGX-ST does not normally review the application for admission
to Catalist but relies on the Sponsor conrming that our Company is suitable to be listed and complies
with the Catalist Rules.
The Authority, the SGX-ST (acting as agent on behalf of the Authority) or other competent authority may,
in certain circumstances issue a stop order (the Stop Order) to our Company, directing that no or no
further Invitation Shares be alloted, allocated, issued and/ or sold.
Where applications to subscribe for and/ or purchase the Invitation Shares to which this Offer Document
relates have been made prior to the Stop Order, and:
(i) where the Invitation Shares have not been issued and/ or transferred to you, your application shall
be deemed to have been withdrawn and cancelled and our Company (for itself and on behalf of the
Vendors) shall, within 14 days from the date of the Stop Order, return to you at your own risk all
monies you have paid on account of your application for the Invitation Shares, without interest or
any share of revenue or other benet arising therefrom; or
(ii) where the Invitation Shares have been issued and/ or transferred to you, the issue and/ or transfer
of the Invitation Shares shall be deemed void and our Company (for itself and on behalf of the
Vendors) shall, within 14 days from the date of the Stop Order, return to you at your own risk all
monies you have paid on account of your application for the Invitation Shares, without interest or
any share of revenue or other benet arising therefrom, and
you will not have any claim against our Company, the Vendors, the Sponsor and Underwriter or the
Placement Agent.
26
A copy of this Offer Document together with copies of the Application Forms have been lodged with and
registered by the SGX-ST acting as agent on behalf of the Authority. Neither the Authority nor the SGX-
ST has, in any way, considered the merits of our existing issued Shares (including the Vendor Shares),
the New Shares or the Shares which may be issued pursuant to the AsiaPhos Performance Share Plan,
as the case may be, being offered or in respect of which the Invitation is made, for investment. We have
not lodged or registered this Offer Document in any other jurisdiction.
The Directors and the Vendors collectively and individually accept full responsibility for the accuracy of
the information given in this Offer Document and conrm after making all reasonable enquiries, that to the
best of their knowledge and belief, this Offer Document constitutes full and true disclosure of all material
facts about the Invitation and our Group, and the Directors and the Vendors are not aware of any facts the
omission of which would make any statement in this Offer Document misleading. Where information in the
Offer Document has been extracted from published or otherwise publicly available sources or obtained
from a named source, the sole responsibility of the Directors and the Vendors has been to ensure that
such information has been accurately and correctly extracted from those sources and/ or reproduced in
the Offer Document in its proper form and context.
No representation, warranty or covenant, express or implied, is made by us, the Vendors, the Sponsor
and Underwriter, the Placement Agent, the experts, or any of our or their respective afliates, directors,
ofcers, employees, agents, representatives or advisers as to the accuracy or completeness of the
information contained herein, and nothing contained in this Offer Document is, or shall, to the extent
permitted by law, be relied upon as a promise, representation or covenant by us, the Vendors, the
Sponsor and Underwriter, the Placement Agent, the experts, or any of our or their respective afliates,
directors, ofcers, employees, agents, representatives or advisers.
None of our Company, the Vendors, the Sponsor and Underwriter, the Placement Agent, the experts, or
any of our or their respective afliates, directors, ofcers, employees, agents, representatives or advisers
or any other parties involved in the Invitation are making any representation or undertaking to any person
regarding the legality of an investment in our Shares by such person under any investment or other laws
or regulations. No information in this Offer Document should be considered as being business, legal,
nancial or tax advice. Investors should be aware that they may be required to bear the nancial risks of
an investment in our Shares for an indenite period of time. You should consult your own professional or
other advisers for business, legal, nancial or tax advice regarding an investment in our Shares.
No person has been or is authorised to give any information or to make any representation not contained
in this Offer Document in connection with the Invitation and, if given or made, such information or
representation must not be relied upon as having been authorised by our Company, the Vendors, the
Sponsor and Underwriter or the Placement Agent. Neither the delivery of this Offer Document, the
Application Forms or any document relating to the Invitation shall, under any circumstances, constitute
a continuing representation or create any suggestion or implication that there has been no change in
our affairs or in the statements of fact or information contained in this Offer Document since the date of
this Offer Document. Where such changes occur and are material or required to be disclosed by law, the
SGX-ST and/ or any other regulatory or supervisory body or agency, we will comply with the relevant
provisions and, if required, make an announcement of the same to the SGX-ST and to the public and/ or
lodge a supplementary or replacement offer document with the SGX-ST acting as agent on behalf of the
Authority. You should take note of any such announcement and, upon release of such an announcement,
shall be deemed to have been given notice of such changes.
Save as expressly stated in this Offer Document, nothing herein is, or may be relied upon as, a promise
or representation as to the future performance or policies of our Company or our subsidiaries. The
Invitation Shares are offered for subscription and/ or purchase solely on the basis of the information
contained and representations made in this Offer Document.
27
We and the Vendors are subject to the provisions of the SFA, SFR and the Catalist Rules regarding the
corporate disclosure. In particular, pursuant to Section 241 of the SFA, if after this Offer Document is
registered but before the close of the Invitation, we and the Vendors become aware of:
(i) a false or misleading statement in this Offer Document;
(ii) an omission from this Offer Document of any information that should have been included in it under
the SFA, SFR or the Catalist Rules; or
(iii) a new circumstance that has arisen since the Offer Document was lodged with the SGX-ST acting
as agent on behalf of the Authority, and would have been required by the SFA, SFR or the Catalist
Rules to be included in this Offer Document, if it had arisen before this Offer Document was
lodged,
that is materially adverse from the point of view of an investor, we and the Vendors may lodge a
supplementary or replacement offer document with the SGX-ST acting as agent on behalf of the Authority
pursuant to Section 241 of the SFA.
In the event that a supplementary or replacement offer document is lodged with the SGX-ST acting as
agent on behalf of the Authority, the Invitation shall be kept open for at least 14 days after the lodgment of
such supplementary or replacement offer document.
Where prior to the lodgment of the supplementary or replacement offer document, applications have been
made under this Offer Document to subscribe for and/ or purchase our Invitation Shares and:
1. where the Invitation Shares have not been issued and/ or sold to you, our Company (for itself and
on behalf of the Vendors) shall:
(i) within two (2) days (excluding any Saturday, Sunday or public holiday) from the date of
lodgment of the supplementary or replacement offer document, give you notice in writing
of how to obtain, or arrange to receive a copy of the supplementary or replacement
offer document, as the case may be, and to provide you with an option to withdraw your
application, and take all reasonable steps to make available within a reasonable period the
supplementary or replacement offer document, as the case may be, to you, where you have
indicated that you wish to obtain, or have arranged to receive, a copy of the supplementary
of replacement offer document; or
(ii) within seven (7) days from the date of lodgment of the supplementary or replacement offer
document, give you the supplementary or replacement offer document, as the case may be,
and provide you with an option to withdraw your application; or
(iii) treat the applications as withdrawn and cancelled, in which case your application shall be
deemed to have been withdrawn and cancelled, and our Company (for itself and on behalf
of the Vendors) shall within seven (7) days from the date of lodgment of the supplementary
or replacement offer document, return all monies paid in respect of any application to you at
your own risk, without interest or any share of revenue or other benet arising therefrom, or
2. where the Invitation Shares have been issued and/ or sold to you, our Company (for itself and on
behalf of the Vendors) shall either:

(i) (A) within two (2) days (excluding any Saturday, Sunday or public holiday) from the date
of lodgment of the supplementary or replacement offer document, give you notice
in writing of how to obtain, or arrange to receive a copy of the supplementary or
replacement offer document, as the case may be, and to provide you with an option to
return to our Company and the Vendors, the Invitation Shares which you do not wish
to retain title in; and
28
(B) take all reasonable steps to make available within a reasonable period the
supplementary or replacement offer document, as the case may be, to you, where
you have indicated that you wish to obtain, or have arranged to receive, a copy of the
supplementary of replacement offer document; or
(ii) within seven (7) days from the date of lodgment of the supplementary or replacement offer
document, give you the supplementary or replacement offer document, as the case may
be, and provide you with an option to return to our Company and the Vendors the Invitation
Shares, which you do not wish to retain title in; or
(iii) (A) in the case of the New Shares, deem the issue as void and refund your payments
for the New Shares (without interest or any share of revenue or other benet arising
therefrom and at your own risk) within seven (7) days from the date of lodgment of the
supplementary or replacement offer document; and
(B) in the case of Vendor Shares, deem the sale of the Vendor Shares as void, and
in the case where documents to evidence title to the Vendor Shares (the title
documents) have been issued to you, within seven (7) days from the date of
lodgment of the supplementary or replacement offer document, inform you to return
the title documents within 14 days from the date of lodgment of the supplementary
or replacement offer document, and within seven (7) days from receipt of the
title documents or the date of lodgment of the supplementary or replacement offer
document, whichever is the later, refund your payments for the Vendor Shares (without
interest or any share of revenue or other benet arising therefrom and at your own
risk), or if no title documents have been issued to you, within seven (7) days from the
date of lodgment of the supplementary or replacement offer document, refund your
payments for the Vendor Shares (without interest or any share of revenue or other
benet arising therefrom and at your own risk),
and you will not have any claim against our Company, the Vendors, the Sponsor and Underwriter
and the Placement Agent.
If you wish to exercise your option under paragraph 1(i) or (ii) above to withdraw your application
in respect of the Invitation Shares, you shall, within 14 days from the date of lodgment of the
supplementary or replacement offer document, notify our Company of this, whereupon our
Company (for itself and on behalf of the Vendors) shall within seven (7) days from the receipt of
such notication, return to you all monies you have paid on account of your application for and/ or
purchase of such Invitation Shares.
If you wish to exercise your option under paragraph 2(i) or (ii) above to return the Invitation
Shares issued and/ or sold to you, you shall, within 14 days from the date of lodgment of
the supplementary or replacement offer document, notify our Company of this and return all
documents, if any, purporting to be evidence of title to those Shares, to our Company, whereupon
our Company (for itself and on behalf of the Vendors) shall within seven (7) days from the receipt of
such notication and documents, if any, return to you all monies you have paid for those Invitation
Shares.
Where monies are to be returned to you for the Invitation Shares, it shall be paid to you without
any interest or share of revenue or other benet arising therefrom at your own risk, and you will not
have any claim against us, the Vendors, the Sponsor and Underwriter and the Placement Agent,
and any issue and/ or sale of those Invitation Shares shall be deemed to be void.
This Offer Document has been prepared solely for the purpose of the Invitation and may not be
relied upon by any other persons other than the applicants in connection with their application for
and/ or purchase of the Invitation Shares.
29
The distribution of this Offer Document and the offer, purchase, sale or transfer of our Shares may
be restricted by law in certain jurisdictions. We, the Vendors, the Sponsor and Underwriter and the
Placement Agent require persons into whose possession this Offer Document comes, to inform
themselves about and to observe any such restrictions at their own expense and without liability
to us, the Vendors, the Sponsor and Underwriter or the Placement Agent.
This Offer Document does not constitute an offer of, or invitation or solicitation to subscribe
for and/ or purchase the Invitation Shares in any jurisdiction in which such offer or invitation or
solicitation is unauthorised or unlawful nor does it constitute an offer or invitation or solicitation
to any person to whom it is unlawful to make such offer or invitation or solicitation. Persons to
whom a copy of this Offer Document has been issued shall not circulate to any other person,
reproduce or otherwise distribute this Offer Document or any information herein for any purpose
whatsoever nor permit or cause such circulation, reproduction or distribution to occur.

Copies of this Offer Document and the Application Forms and envelopes may be obtained on request,
during ofce hours, subject to availability, from:
United Overseas Bank Limited
80 Rafes Place
#03-03
UOB Plaza 1
Singapore 048624
Asiasons WFG Capital Pte. Ltd.
22 Cross Street
#03-54/61
China Square Central
Singapore 048421
A copy of this Offer Document is also available on the SGX-ST website at http://www.sgx.com.
The Invitation will be open at 7.00 p.m. from 25 September 2013 and will remain open until 12.00
noon on 3 October 2013 or such further period or periods as our Company and the Vendors may, in
consultation with the Sponsor and Underwriter and the Placement Agent, in their absolute discretion,
decide, subject to any limitations under all applicable laws, PROVIDED ALWAYS THAT where a
supplementary offer document or replacement offer document has been lodged with the SGX-ST
acting as agent on behalf of the Authority, the Invitation shall be kept open for at least 14 days after the
lodgment of the supplementary offer document or replacement offer document.

Details for the procedure for application for the Invitation Shares are set out in Appendix G entitled
Terms, Conditions and Procedures for Application and Acceptance to this Offer Document.
30
INDICATIVE TIMETABLE FOR LISTING
The indicative timetable is set out below for the reference of applicants:
Indicative Time and Date Event
25 September 2013, 7.00 p.m. Opening date and time for the Invitation
26 September 2013, 12.30 p.m. Opening date and time for Electronic Applications

3 October 2013, 12.00 noon Closing date and time for the Invitation
4 October 2013 Balloting of applications, if necessary (in the event
of over-subscription for the Offer Shares)
7 October 2013, 9.00 a.m. Commence trading on a ready basis
10 October 2013 Settlement date for all trades done on a ready
basis
The above timetable is only indicative as it assumes that the closing of the Invitation takes place on
3 October 2013, the date of admission of our Company to Catalist will be 7 October 2013, the SGX-STs
shareholding spread requirement will be complied with and the Invitation Shares will be issued or allotted
and fully paid prior to 7 October 2013. The actual date on which our Shares will commence trading
on a ready basis will be announced when it is conrmed by the SGX-ST.
Please note that the timetable is indicative only and is subject to change (whether in relation to the Offer
Shares, Placement Shares or any mode of application thereof) at the discretion of our Company and the
Vendors, with the agreement of the Sponsor and Underwriter and the Placement Agent.
The above timetable and procedures may also be subject to such modications as the SGX-ST may, in
its discretion, decide, including the decision to permit trading on a ready basis and the commencement
date of such trading.
Investors should refer to the SGX-ST announcement on the ready trading date on the Internet
(at the SGX-ST website http://www.sgx.com) or the newspapers or check with their brokers on the
date on which trading on a ready basis will commence.
In the event of any changes in the closure of the Invitation or the extension of the time period during
which the Invitation is open, we will publicly announce the same:
(i) through a SGXNET announcement to be posted on the internet at the SGX-ST website
(http://www.sgx.com); and
(ii) in a local English newspaper such as The Straits Times or The Business Times.
Results of the Invitation including the level of subscription and the basis of allotment of the Offer Shares
will be provided as soon as it is practicable after the closure of the Invitation through the channels in (i)
and (ii) above.

31
SUMMARY OF INVITATION
The Issuer : AsiaPhos Limited, a company with limited liability incorporated under
the laws of Singapore on 3 January 2012.

Invitation Size : 122,000,000 Invitation Shares comprising 97,600,000 New Shares
and 24,400,000 Vendor Shares. The New Shares will, upon issue
and allotment, rank pari passu in all respects with our existing issued
Shares (including the Vendor Shares).

The Invitation : The Invitation comprises an offering of:
(a) 2,000,000 Offer Shares at the Invitation Price, to members of
the public in Singapore; and
(b) 120,000,000 Placement Shares at the Invitation Price, for
placement to members of the public and institutional investors in
Singapore,
subject to and on the terms and conditions of this Offer Document.

Invitation Price : S$0.25 for each Invitation Share. Investors are required to pay the
Invitation Price in S$.

Clawback and : The Invitation Shares may be re-allocated between the Offer and
Re-allocation Placement tranches at the discretion of the Sponsor in the event of an
over-subscription in one and an under-subscription in the other.

Purpose of the Invitation : Our Directors consider that the listing and quotation of our Shares
on Catalist will enhance our public image locally and internationally
and enable us to tap into the capital markets to fund our business
growth. It will also provide members of the public with an opportunity
to participate in the equity of our Company. The Invitation will also
enlarge our capital base for continued expansion of our business.

Listing Status : Prior to the Invitation, there had been no public market for our Shares.
Our Shares will be quoted in S$ on Catalist, subject to admission
of our Company to Catalist and permission for dealing in and for
quotation of our Shares (including the Vendor Shares), the New
Shares and the Shares which may be issued under the AsiaPhos
Performance Share Plan being granted by the SGX-ST and the
Authority, the SGX-ST (acting as agent on behalf of the Authority) or
other competent authority not issuing a Stop Order.

Risk Factors : Prospective investors should carefully consider certain risks
connected with an investment in our Shares. Please refer to the
section entitled Risk Factors of this Offer Document for further
details.
32
PLAN OF DISTRIBUTION
The Invitation
The Invitation is for 2,000,000 Offer Shares and 120,000,000 Placement Shares offered in Singapore by
way of a public offer and placement respectively. We are making an offering of 97,600,000 New Shares
and the Vendors are making an offering of an aggregate of 24,400,000 Vendor Shares for subscription
and/ or purchase at the Invitation Price for each Invitation Share.
The Invitation Price
The Invitation Price is determined by us in consultation with the Sponsor and Underwriter as well as the
Placement Agent after taking into consideration, inter alia, prevailing market conditions and estimated
market demand for our Shares determined through a book-building process. The Invitation Price is the
same for each Invitation Share and is payable in full on application.
There are no arrangements whereby the number of Shares being offered pursuant to this Invitation may
be increased by the exercise of an underwriters over-allotment option.
Offer Shares
The Offer Shares are made available to members of the public in Singapore for subscription and/ or
purchase at the Invitation Price. Applications for Offer Shares may be made by way of printed Application
Forms or by way of Electronic Applications. The terms and conditions and procedures for application and
acceptance are set out in Appendix G entitled Terms, Conditions and Procedures for Application and
Acceptance to this Offer Document.
Pursuant to the terms and conditions contained in the Management and Underwriting Agreement as
disclosed in the section entitled Management, Underwriting and Placement Arrangements of this Offer
Document, the Sponsor and Underwriter has agreed to manage the Invitation and to underwrite the Offer
Shares. The Underwriter may, at its absolute discretion, appoint one (1) or more sub-underwriters.
In the event of an under-subscription for the Offer Shares as at the close of the Invitation, the number of
Offer Shares not subscribed for and/ or purchased shall be made available to satisfy excess applications
for the Placement Shares to the extent that there is an over-subscription for the Placement Shares as at
the close of the Invitation.
In the event of an over-subscription for the Offer Shares as at the close of the Invitation and/ or the
Placement Shares are fully subscribed, purchased or over-subscribed for as at the close of the Invitation,
the successful applications for the Offer Shares will be determined by ballot or otherwise as determined
by our Directors, after consultation with the Sponsor, and approved by the SGX-ST, if required.
In the event that the Placement Agent receives valid applications and payment for less than 85%
of the Placement Shares by 12.00 noon on 2 October 2013 (or such later date and time as may
be decided by the Placement Agent), the Placement Agent shall have the right to terminate the
Placement Agreement (by notice in writing to the Company and the Vendors). The Management
and Underwriting Agreement is conditional upon the Placement Agreement not being terminated
or rescinded. In the event of termination of the Placement Agreement, the Management and
Underwriting Agreement will also terminate. In the event the Management and Underwriting
Agreement and/ or the Placement Agreement are terminated, our Company and the Vendors
reserves the right, in our and their absolute discretion, to cancel the Invitation, upon which
all application monies will be returned to subscribers and/ or purchasers without interest or
any share of revenue or other benet arising therefrom and at their own risk, and subscribers
and/ or purchasers will not have any claim against our Company, the Vendors, the Sponsor and
Underwriter, or the Placement Agent.
33
PLAN OF DISTRIBUTION
Placement Shares
The Placement Shares are made available to retail and institutional investors in Singapore. Applications
for the Placement Shares may be made by way of printed Application Forms or such other forms of
application as the Sponsor and Underwriter and the Placement Agent deem appropriate. The terms and
conditions and procedures for application and acceptance are set out in Appendix G entitled Terms,
Conditions and Procedures for Application and Acceptance to this Offer Document.
Pursuant to the terms and conditions contained in the Placement Agreement as disclosed in the
section entitled Management, Underwriting and Placement Arrangements of this Offer Document,
the Placement Agent has agreed to subscribe for and/ or purchase, or procure subscribers and/ or
purchasers for the Placement Shares, at the Invitation Price. The Placement Agent may, at its absolute
discretion, appoint one (1) or more sub-placement agents for the Placement Shares.
In the event of an under-subscription for the Placement Shares as at the close of the Invitation, that
number of Placement Shares not subscribed for and/ or purchased shall be made available to satisfy
excess applications for the Offer Shares to the extent that there is an over-subscription for the Offer
Shares as at the close of the Invitation.
In the event that the Placement Agent receives valid applications and payment for less than 85%
of the Placement Shares by 12.00 noon on 2 October 2013 (or such later date and time as may
Placement Agreement (by notice in writing to the Company and the Vendors). The Management
and Underwriting Agreement is conditional upon the Placement Agreement not being terminated
or rescinded. In the event of termination of the Placement Agreement, the Management and
Underwriting Agreement will also terminate. In the event the Management and Underwriting
Agreement and/ or the Placement Agreement are terminated, our Company and the Vendors
reserve the right, in our and their absolute discretion, to cancel the Invitation, upon which
all application monies will be returned to subscribers and/ or purchasers without interest or
any share of revenue or other benet arising therefrom and at their own risk, and subscribers
and/ or purchasers will not have any claim against our Company, the Vendors, the Sponsor and
Underwriter or the Placement Agent.
Subscribers for and purchasers of the Placement Shares may be required to pay brokerage of up to one
per cent. (1%) of the Invitation Price to the Placement Agent or any sub-placement agent as may be
appointed by the Placement Agent as well as stamp duties and other charges.
Subscription for and purchase of the Invitation Shares
None of our Substantial Shareholders, Directors, Key Executives, and employees intend to subscribe for
and/ or purchase more than ve per cent. (5%) of the Invitation Shares. To the best of our knowledge, we
are unaware of any person who intends to subscribe for and/ or purchase more than ve per cent. (5%)
of the Invitation Shares.
However, through the book-building process to assess market demand for our Shares, there may be
person(s) who may indicate an interest to subscribe for and/ or purchase more than ve per cent. (5%)
of the Invitation Shares. If such person(s) were to make an application for more than ve per cent. (5%)
of the Invitation and are subsequently allotted and/ or allocated such number of Shares, we will make the
necessary announcements at an appropriate time. The nal allotment and/ or allocation of Shares will
be in accordance with the shareholding spread and distribution guidelines as set out in Rule 406 of the
Catalist Rules.
No Shares shall be allotted or allocated on the basis of this Offer Document later than six (6) months
after the date of registration of this Offer Document by the SGX-ST acting as agent on behalf of the
Authority.
34
INVITATION STATISTICS
Invitation Price S$0.25
NAV
(1)
NAV per Share based on the unaudited combined balance sheet of our Group as
at 31 March 2013:
(a) before adjusting for the estimated net proceeds from the issue of the New
Shares and based on the pre-Invitation share capital of 702,400,000 Shares
4.28 cents
(b) after adjusting for the estimated net proceeds from the issue of the New
Shares and based on the post-Invitation share capital of 800,000,000 Shares
6.45 cents
Premium of Invitation Price over the NAV per Share as at 31 March 2013:
(a) before adjusting for the estimated net proceeds from the issue of the New
Shares and based on the pre-Invitation share capital of 702,400,000 Shares
484.1%
(b) after adjusting for the estimated net proceeds from the issue of the New
Shares and based on the post-Invitation share capital of 800,000,000 Shares
287.6%
Earnings per Share
Historical EPS of our Group for FY2012 based on the prot for the year attributable
to owners of the Company and the pre-Invitation share capital of 702,400,000
Shares
0.17 cents
Historical EPS of our Group for FY2012 based on the prot for the year attributable
to owners of the Company (assuming that the Service Agreements had been
in place from the beginning of FY2012) and the pre-Invitation share capital of
702,400,000 Shares
0.16 cents
Price Earnings Ratio
Historical price earnings ratio based on the Invitation Price and the historical EPS
of our Group for FY2012 and the pre-Invitation share capital of 702,400,000 Shares
147 times
Historical price earnings ratio based on the Invitation Price and the historical EPS
of our Group had the Service Agreements been in place from the beginning of
FY2012 and the pre-Invitation share capital of 702,400,000 Shares
156 times
Net Operating Cash Flow
(2)
per Share
Historical net operating cash ow per Share of our Group for FY2012 based on the
pre-Invitation share capital of 702,400,000 Shares
(0.23) cents
Historical net operating cash ow per Share of our Group for FY2012 (assuming
that the Service Agreements had been in place from the beginning of FY2012)
based on the pre-Invitation share capital of 702,400,000 Shares
(0.24) cents
35
INVITATION STATISTICS
Ratio of Invitation Price to historical net operating cash ow
Ratio of Invitation Price to historical net operating cash ow per Share based on
the pre-Invitation share capital of 702,400,000 Shares
Not meaningful
(3)
Ratio of Invitation Price to historical net operating cash ow per Share (assuming
that the Service Agreements had been in place from the beginning of FY2012)
based on the pre-Invitation share capital of 702,400,000 Shares
Not meaningful
(3)
Market Capitalisation
Market capitalisation based on the Invitation Price and the post-Invitation share
capital of 800,000,000 Shares
S$200 million
Notes:
(1) NAV is dened as total assets less total liabilities. Please see the section entitled Interim Condensed Combined Balance
Sheets as at 31 March 2013 of Appendix B entitled Unaudited Interim Condensed Combined Financial Statements for the
three months period ended 31 March 2013 to this Offer Document for more information.
(2) Net operating cash ow is dened as net cash ows generated from/ (used in) operating activities. Please see the section
entitled Combined Statements of Cash Flow for the nancial years ended 31 December 2010, 2011 and 2012 of Appendix
A entitled Audited Combined Financial Statements for the nancial years ended 31 December 2010, 2011 and 2012 to this
Offer Document for more information.
(3) Not meaningful as the Group recorded negative net operating cash ow for FY2012.
36
USE OF PROCEEDS
The net proceeds to be raised from the Invitation (comprising New Shares and Vendor Shares) will be
approximately S$27.5 million after deducting the remaining estimated expenses to be incurred and/ or
paid in relation to the Invitation of approximately S$3.0 million (which will be borne by the Vendors and
the Company). The total expenses in relation to the Invitation will be approximately S$5.7 million.
We will not receive any of the proceeds from the Vendor Shares sold by the Vendors in the Invitation. The
net proceeds attributable to the Vendors for the sale of Vendor Shares will be approximately S$5.9 million,
after deducting the Vendors share of the estimated expenses in relation to the Invitation of approximately
S$0.2 million.
The net proceeds to be raised by our Company from the issue of the New Shares will be approximately
S$21.6 million, after deducting our share of the estimated expenses in relation to the Invitation of
approximately S$2.8 million.
Save as disclosed in this Offer Document, none of the proceeds raised by our Company from the issue of
the New Shares will be used, directly or indirectly, to acquire or renance the acquisition of an asset other
than in the ordinary course of business or the acquisition of another business.
Save for the underwriting and placement commission and brokerage which will be borne by our Company
and the Vendors in the proportion in which the Invitation Shares are offered by each of them, the rest of
the expenses incurred in relation to the Invitation will be borne by our Company.
The intended allocation of proceeds raised by our Company from the issue of New Shares and estimated
expenses incurred in connection with the Invitation which are to be borne by us are set out below
(including GST, where applicable):
Use of Proceeds
Estimated amount
(S$000)
Amount allocated for each dollar
of proceeds raised by our
Company from the Invitation
(as a percentage of gross
proceeds)
Development and expansion of our Mining
Operations 8,500 34.8

Financing the balance of Phase 1 and Phase 2
of the Rebuilding Programme 11,499 47.1

Working capital 1,553 6.4

Net proceeds 21,552 88.3
Expenses
(1)

Listing fees 43 0.2

Professional fees 1,582 6.5

Underwriting commission, placement commission
and brokerage 770 3.1

Miscellaneous expenses 453 1.9

Total 24,400 100.0
Note:
(1) In accordance with the Singapore Financial Reporting Standards, a portion of the listing expenses incurred by our Company
in connection with the Invitation will be recognised as an expense in FY2013. This will have an effect on our nancial results
in FY2013.
37
USE OF PROCEEDS
Pending the deployment of the net proceeds as aforesaid, the net proceeds may be added to our working
capital, placed as deposits with banks or nancial institutions, or used for investment in short-term
deposits, money market or debt instruments, as our Directors may deem appropriate in their absolute
discretion.
The foregoing represents our best estimate of our allocation of our gross proceeds from the issue of
New Shares based on our current plans and estimates regarding our anticipated expenditures. Actual
expenditures may vary from these estimates, and we may nd it necessary or advisable to re-allocate
our net proceeds within the categories described above or to use portions of our net proceeds for
other purposes. In the event that the amount set aside to meet the estimated expenses listed above
is in excess of the actual expenses incurred, such excess amounts will be made available for our
working capital purposes. In the event that we decide to re-allocate our net proceeds from the issue of
New Shares for other purposes, we will publicly announce our intention to do so through a SGXNET
announcement to be posted on the internet at the SGX-ST website, http://www.sgx.com.
We will also announce on the SGXNET as and when the proceeds of the Invitation have been materially
disbursed, and provide a status report on the use of proceeds of the Invitation in the annual report(s) of
our Company.
38
MANAGEMENT, UNDERWRITING AND PLACEMENT ARRANGEMENTS
1. Pursuant to the Management and Underwriting Agreement entered into between our Company, the
Vendors and the Sponsor and Underwriter, our Company appointed UOB to sponsor and manage
the Invitation. UOB will receive a sponsorship and management fee from our Company for such
services rendered in connection with the Invitation.
Pursuant to the Management and Underwriting Agreement, UOB has agreed to underwrite the
Offer Shares for a commission of three per cent. (3%) of the Invitation Price for each Offer Share,
payable by our Company and each of the Vendors in the proportion in which the Offer Shares
offered by our Company and each of the Vendors bears to the aggregate number of Offer Shares
(the Agreed Proportion). UOB may, at its absolute discretion, appoint one (1) or more sub-
underwriters for the Offer Shares.
2. Pursuant to the Placement Agreement entered into between our Company, the Vendors and
Asiasons, as the Placement Agent, the Placement Agent has agreed to subscribe and/ or purchase
and/ or procure subscribers and/ or purchasers (as the case may be) for the Placement Shares for
a placement commission of three per cent. (3%) of the Invitation Price for each Placement Share
payable by our Company and each of the Vendors in the Agreed Proportion. The Placement Agent
may, at its absolute discretion, appoint one (1) or more sub-placement agents for the Placement
Shares.
3. For the Offer Shares, brokerage will be paid by our Company and each of the Vendors, in the
Agreed Proportion, to members of the Association of Banks in Singapore, members of the SGX-
ST and merchant banks, in respect of successful applications made on Application Forms bearing
their respective stamps, or to the Participating Banks in respect of successful applications made
through Electronic Applications, at the rate of 0.25% of the Invitation Price for each Offer Share, or
in the case of DBS Bank, 0.75% of the Invitation Price for each Offer Share. In addition, DBS Bank
levies a minimum fee of S$10,000 that will be payable by our Company and each of the Vendors
in the Agreed Proportion (and which will remain payable in the event the Invitation is terminated/
cancelled for any reason).
Subscribers and/ or purchasers of the Placement Shares may be required to pay brokerage of
one per cent. (1%) of the Invitation Price to the Placement Agent (or any sub-placement agent
appointed by the Placement Agent), as well as stamp duties and any other similar charges (subject
to any GST, where applicable).
4. The Management and Underwriting Agreement and the Placement Agreement may be terminated
or rescinded by the Sponsor and Underwriter and the Placement Agent respectively at any time on
or before the issue of the New Shares, on the occurrence of certain events including, inter alia:
(a) if there shall have come to the knowledge of the Sponsor or the Underwriter and/ or the
Placement Agent any breach of the obligations, representations, warranties or undertakings
in the Management and Underwriting Agreement and/ or the Placement Agreement (as the
case may be) or any of the said warranties is untrue or incorrect;
(b) if there shall have been:
(i) any material adverse change, or any development involving a prospective material
adverse change, in the business, trading position, operations, prospects or conditions
(nancial or otherwise), performance or general affairs of our Company or of our
Group as a whole; or
(ii) any introduction or prospective introduction of or any change or prospective change
in any legislation, regulation, order, policy, rule, guideline or directive (whether or not
having the force of law and including, without limitation, any directive or request issued
by the Authority, ACRA, the Securities Industry Council of Singapore or the SGX-
ST) in Singapore, the PRC or elsewhere or in the interpretation or application thereof
by any court, government body, regulatory authority or other competent authority in
Singapore, the PRC or elsewhere; or
39
(iii) any change, or any development involving a prospective change, or any adverse
uctuation, in local, national, regional or international nancial (including stock market,
foreign exchange market, inter-bank market or interest rates or money market),
political, industrial, economic, legal or monetary conditions, taxation or exchange
controls (including, without limitation, the imposition or any moratorium, suspension
or restriction on trading in securities generally on the SGX-ST due to exceptional
nancial circumstances or otherwise); or
(iv) any imminent threat or occurrence of any local, national, regional or international
outbreak or escalation of hostilities, insurrection, terrorist attacks or armed conict
(whether or not involving nancial markets in any jurisdiction); or
(v) any regional or local outbreak of any infectious disease including any recurrence of
severe acute respiration syndrome or avian inuenza or any disease that may have an
adverse effect on the nancial markets; or
(vi) any other occurrence of any nature whatsoever,
which event or events shall in the reasonable opinion of the Sponsor and Underwriter and/
or the Placement Agent: (1) result or be likely to result in a material adverse uctuation
or adverse conditions in the stock market in Singapore or overseas, or (2) prejudice or be
reasonably likely to prejudice the success of the subscription, sale or offer of the Invitation
Shares (whether in the primary market or in respect of dealings in the secondary market), or
(3) make it impracticable, inadvisable, inexpedient or uncommercial to proceed with any of
the transactions contemplated under the Management and Underwriting Agreement and/ or
the Placement Agreement, or (4) be likely to have a material adverse effect on the business,
trading position, operations or prospects of our Company or of our Group as a whole, or
(5) be such that no reasonable underwriter or placement agent would have entered into the
Management and Underwriting Agreement and the Placement Agreement (as the case may
be), or (6) result or be likely to result in the issue of a Stop Order by the relevant authorities
or the SGX-ST acting as agent on behalf of the Authority pursuant to the SFA, SFR and
Catalist Rules, or (7) make it uncommercial or otherwise contrary to or outside the usual
commercial practices of underwriting or placement (as the case may be) in Singapore for
the Sponsor and Underwriter to observe or perform or be obliged to observe or perform
the terms of the Management and Underwriting Agreement, and for the Placement Agent
to observe or perform or be obliged to observe or perform the terms of the Placement
Agreement; or
(c) there shall come to the knowledge of the Sponsor and Underwriter and/ or the Placement
Agent any breach of the representations, warranties or undertakings by our Company
and/ or the Vendors in the Management and Underwriting Agreement and the Placement
Agreement (as the case may be) or that any of the warranties in the Management and
Underwriting Agreement and the Placement Agreement (as the case may be) is untrue or
incorrect; or
(d) there is a contravention by any of the Company or its subsidiaries or any of the Vendors
of the Catalist Rules or any applicable laws, rules, regulations and directives of any
relevant governmental, administrative or supervisory entities which have an adverse effect
on business, trading position, operations, prospects or condition (nancial or otherwise),
performance or general affairs of our Company or its subsidiaries or the performance of the
Management and Underwriting Agreement and the Placement Agreement (as the case may
be) or consummation of any of the transactions contemplated thereunder; or
(e) the issue of a Stop Order by the Authority, the SGX-ST acting as agent on behalf of the
Authority, or other competent authorities, in accordance with the SFA, SFR and/ or Catalist
Rules; or

(f) no replacement offer document is lodged following the issue of a Stop Order by the
Authority, the SGX-ST as agent acting on behalf of the Authority or other competent
authorities, in accordance with the SFA, SFR and/ or Catalist Rules; or
40
(g) the issue of a ruling from the SGX-ST prohibiting the listing and quotation of all the issued
Shares on Catalist; or
(h) there is a material breach of any term or condition in the Management and Underwriting
Agreement and/ or the Placement Agreement by our Company or any of the Vendors; or
(i) any Director being charged with an offence and/ or becoming unable to participate in the
management of our Company; or
(j) without limiting the generality of the foregoing, if it comes to the notice of the Sponsor
and Underwriter and/ or the Placement Agent: (1) any statement contained in this Offer
Document or the Application Forms relating hereto which in the sole and absolute opinion
of the Sponsor and Underwriter and/ or the Placement Agent (as the case may be) has
become untrue, incorrect or misleading in any respect, or (2) circumstances or matters
have arisen or have been discovered, which would, if the Offer Document was to be issued
at that time, constitute in the sole and absolute opinion of the Sponsor and Underwriter
and/ or the Placement Agent (as the case may be), a material omission of information, and
the Company fails to lodge a supplementary or replacement offer document (as the case
may be) within a reasonable time after being notied of such material misrepresentation or
omission or fails to promptly take such steps as the Sponsor and Underwriter and/ or the
Placement Agent may require to inform investors of the lodgment of such supplementary
or replacement offer document. In such an event, the Sponsor and Underwriter and the
Placement Agent each reserves the right, at its absolute discretion to inform the SGX-ST
and the Authority and to cancel the Invitation, and any application monies received shall be
refunded (without interest or any share of revenue or other benet arising therefrom) to the
applicants for the Invitation Shares by ordinary post or telegraphic transfer or such other
means as the Sponsor and Underwriter and/ or the Placement Agent may deem appropriate
at the applicants own risk within 14 days of the termination of the Invitation; or
(k) the Placement Agent terminates or rescinds the Placement Agreement (in the case of the
Management and Underwriting Agreement), or the Sponsor and Underwriter terminates
or rescinds the Management and Underwriting Agreement (in the case of the Placement
Agreement).
5. In the event the Placement Agent receives valid applications and payment for less than 85% of
the Placement Shares by 12.00 noon on 2 October 2013 (or such later date and time as may
Placement Agreement (by notice in writing to the Company and the Vendors).
6. In the event the Management and Underwriting Agreement and/ or the Placement Agreement are
terminated or rescinded, our Company and the Vendors reserve the right, in our and their absolute
discretion, to cancel the Invitation.
7. The Invitation Shares may be reallocated between the Offer Shares and the Placement Shares as
may be agreed between the Sponsor and Underwriter and the Placement Agent.
8. All undertakings, warranties, covenants and indemnities under the Management and Underwriting
Agreement and the Placement Agreement made by the Company and the Vendors are made by
them jointly and severally in the Agreed Proportion.
9. Our Company has agreed with the Sponsor and Underwriter and the Placement Agent that we will
not, inter alia, issue, offer, sell, contract to sell, pledge or otherwise transfer or dispose of directly
or indirectly, (i) any new Shares, (ii) any securities convertible or exercisable or exchangeable for
or which carry rights to subscribe for or purchase any Shares, (iii) any equity or debt securities
(whether in the form of, or represented or evidenced by, bonds, notes, debentures, loan stock or
otherwise), or (iv) any options, rights or warrants in respect of any Shares (other than pursuant
to the AsiaPhos Performance Share Plan), in each case, without the prior written consent of the
Sponsor and Underwriter and the Placement Agent, for a period of six (6) months from the date of
admission of our Company to the SGX-ST.
41
RISK FACTORS
An investment in our Shares involves risks. You should carefully consider and evaluate each of the
following considerations and all of the other information set forth in this Offer Document before deciding
to invest in our Shares. The following describes some of the signicant risks known to us now that could
directly or indirectly affect us and any investments in, or the value or trading price of, our Shares. The
following does not state risks unknown to us now but which could occur in future and risks which we
currently believe to be immaterial, which could turn out to be material. Should such risks occur or turn out
to be material, they could materially and adversely affect our business operations, results of operations,
nancial condition, cash ow, protability and performance, prospects or results (collectively referred to as
Business in this section).
Some of the following risk factors and considerations relate principally to the industry in which we
operate and our business in general. Other risk factors and considerations relate principally to general
social, economic, political and regulatory conditions, the securities market and ownership of our Shares,
including possible future dilution in the value of our Shares. Headings are for ease of reference only and
do not affect the interpretation or extent of considerations set forth in this Offer Document.
If any of the following considerations, risks and uncertainties develops into actual events, our Business
and any investment in our Shares could be, directly or indirectly, materially and adversely affected. In
such event, the trading price of our Shares could decline due to any of these considerations, and you
may lose all or part of your investment. You should consider the information below in connection with
the forward-looking statements in this Offer Document and you should also note the warning regarding
forward-looking statements under the section entitled Cautionary Notes Regarding Forward-Looking
Statements of this Offer Document.
Before deciding to invest in our Shares, you should seek professional advice from your advisers regarding
your particular circumstances.
RISKS RELATING TO OUR BUSINESS
We are subject to natural disasters in the areas where our Mining Operations and Chemical
Production Operations are situated
Natural disasters such as earthquakes, oods, landslides and mudslides could severely hamper our
Mining Operations and Chemical Production Operations, which are located in west-central Sichuan
Province in the PRC. According to the WGM Technical Report, our Mining Operations and Chemical
Production Operations are located at an active earthquake belt, where minor shocks have frequently
occurred. More than ten (10) earthquakes affecting the region have been recorded, and it is expected that
earthquakes will recur in future.
For example, our Mining Operations and Chemical Production Operations were substantially affected by
the Wenchuan Earthquake. Access roads leading to our Mines were obstructed and part of our Previous
Hanwang Facilities was irreparably damaged as a result of the Wenchuan Earthquake, and we also
experienced fatalities and casualties among our mining personnel. In the aftermath of the Wenchuan
Earthquake, we also experienced subsequent landslides (including a major landslide in 2010) which
blocked the access roads to our Mines.
On 20 April 2013, the south-western part of Sichuan Province, PRC was struck by an earthquake which
measured 7.0 on the Richter magnitude scale (the Lushan Earthquake). The Lushan Earthquake and
the subsequent aftershocks caused loss of lives, power outages, landslides and business shut-downs.
The Lushan Earthquake occurred more than 250 km away from our Mining Operations and Chemical
Production Operations. None of our workers were hurt and we did not suffer any property damage. In July
2013, Sichuan Province, the PRC, experienced heavy rainfall which resulted in ooding, possible loss of
lives and damage to property and transport infrastructure (certain bridges facilitating access to the New
Gongxing Site were damaged). As part of our safety policy, our Mining Operations are halted during the
rainy season, which typically lasts from early July to the end of August. As a result, we are unable to
assess the extent to which our Mining Operations have been or may be affected by the ooding resulting
from such heavy rainfall.
42
RISK FACTORS
Our vulnerability to natural disasters is exacerbated by the fact that our Mines are situated within
approximately 8 km of each other in Mianzhu City, Sichuan Province, the PRC, and rely on the same
transportation infrastructure. Given their physical proximity, the occurrence of a natural disaster, such as
the Wenchuan Earthquake, could substantially affect our Mines and accordingly our Business.
In the event of such natural disasters, our Mining Operations and Chemical Production Operations may
be substantially affected or suspended altogether and injuries or casualties may occur. In addition,
operating costs may increase as a result of equipment and facility damage, power outages, personnel
evacuation and other similar events. Delivery of phosphate rocks to our New Gongxing Facilities and
customers may also be disrupted. In addition, such disruptions may cause us to purchase phosphate
rocks from other suppliers which may be more costly and/ or of inferior quality, thereby resulting in higher
operating costs for our Chemical Production Operations. We may also continue to incur xed operating
expenses while our Mining Operations and/ or Chemical Production Operations have slowed down or
ceased altogether. As such, any disruptions, delays or suspensions of our Mining Operations and
Chemical Production Operations as a result of natural disasters or other events beyond our control will
have a material adverse effect on our Business. Furthermore, the occurrence of a natural disaster within
the proximity of our Mines and/ or the fact that we are vulnerable to natural disasters may affect our ability
to obtain external nancing on a timely basis, on terms acceptable to us, or at all. In the event that any of
the above-mentioned events occur, our Business may be materially and adversely affected.
Our Mining Operations and Chemical Production Operations are subject to seasonal disruptions
Our Mining Operations and Chemical Production Operations are subject to various seasonal events and
operating conditions, such as inclement weather.
As part of our safety policy, our Mining Operations are halted annually during (i) the winter season, which
typically lasts from mid-December to mid-March; and (ii) the rainy season, which typically lasts from
early July to the end of August. Barring unforeseen circumstances, we undertake Mining Operations for
about seven (7) months per year on a daily basis, subject to, inter alia, holidays, weather conditions and
equipment maintenance.
During the low-water periods, which typically last from mid-November to mid-April, our electricity
costs increase and we may not produce P
4
, which requires high levels of electricity, unless justied by
sufciently high market prices of P
4
. In the event that such costs cannot be effectively passed on to our
customers, our Business may be adversely affected.
Although we maintain buffer stocks of phosphate rocks and P
4
, in the event that our Group experiences a
surge in demand for phosphate rocks or phosphate-based chemical products during the non-mining and
non-production periods, we may not be able to cope with the increase in demand, which may materially
and adversely affect our Business.
In the event that the winter season, rainy season or low-water periods are prolonged, our Business may
be materially and adversely affected.
Furthermore, due to this seasonality, our nancial performance in one nancial quarter may not be
indicative of our nancial performance for the subsequent or corresponding nancial quarter(s) in the
previous nancial year.
We are required to obtain and/ or renew certain approvals, licences, authorisations and permits
for our Mining Operations and Chemical Production Operations
Land occupied by our Mines
As at the Latest Practicable Date, we have obtained approval from the Deyang Forestry Bureau for the
forestry land occupied by our Mines. Such approval is described as relating to temporary occupation
of forestry land, and is valid from 24 August 2012 to 31 July 2014. Since occupying the forestry land in
2002, we have not experienced any issues in renewing the approval. However, in the event that we are
unable to renew the approval on a timely basis or at all, we may be required to vacate the forestry land
occupied by our Mines, be subject to certain nes or penalties and/ or required to restore such forestry
land to its original condition within a prescribed time limit.
43
RISK FACTORS
As at the Latest Practicable Date, to the best of our knowledge, the Mianzhu Land Bureau does not
issue land use rights certicates for the land occupied by our Mines, or the land occupied by other mines
situated in the vicinity of our Mines. Mianzhu Land Bureau issued a letter dated 16 February 2012 to
Mianzhu Norwest stating, inter alia, that since incorporation, Mianzhu Norwest has been in compliance
with relevant PRC state and local land laws, rules and regulations. As at 16 February 2012, we occupied
1.7665 hectares of forestry land for our Mines. As at the Latest Practicable Date, we occupied 2.4564
hectares of forestry land for our Mines.
In the event that we are required to obtain such land use rights certicates, retrospectively or otherwise,
and are unable to do so on a timely basis, on conditions acceptable to us, or at all, we may be required to
vacate the land occupied by our Mines, and/ or be subject to certain nes or penalties.

Mining Operations for Mine 2
As at the Latest Practicable Date, we are engaged in Trial Mining Operations at Mine 2, pursuant to the
Trial Mining Notications. Mianzhu Norwest has submitted its application for the (safety
production permit) for its Mining Operations (the Mining Safety Production Permit) for Mine 2 in June
2013. We will be able to carry out Commercial Mining Operations for Mine 2 after we receive the Mining
Safety Production Permit for Mine 2. In the event that the Mining Safety Production Permit for Mine 2
is not granted by the relevant authorities on a timely basis, on conditions acceptable to us, or at all, we
will be unable to commence our Commercial Mining Operations at Mine 2. Further, to the best of our
knowledge, the Trial Mining Notications were issued to assist us in resuming mining operations after the
Wenchuan Earthquake, and in the event that such Trial Mining Notications are subsequently withdrawn
before we obtain the Mining Safety Production Permit for Mine 2, we may be required to cease our Trial
Mining Operations.
Chemical Production Operations at the New Gongxing Site, Phase 1 Land
As at the Latest Practicable Date, we have obtained the land use rights certicate, the necessary
approvals required for our Trial Chemical Production Operations and certain construction permits for
Phase 1 of our Rebuilding Programme. In order to achieve legal completion for Phase 1 of the Rebuilding
Programme, we will also need to obtain Phase 1 Completion Approvals (as dened under the section
entitled General Information on our Group Legal Opinion from King & Wood Mallesons of the Offer
Document). There can be no assurance that we will be able to obtain any or all of these approvals on a
timely basis, on conditions acceptable to us, or at all.
Further, we will need to obtain, inter alia, (i) the (safety production permits) for Chemical
Production Operations (the Chemical Safety Production Permit); (ii) the (pollution
discharge permit) (the Pollution Discharge Permit); (iii) the (hazardous
chemicals business licence); (iv) the (hazardous chemicals registration certicate);
(v) the (licence for the manufacturing of industrial products); (vi) the
(environmental management registration licence for the production and use
of dangerous chemicals); and (vii) the (building ownership rights certicate) in order to
commence Commercial Chemical Production Operations at our Phase 1 facilities, and if we are unable to
do so on a timely basis, on conditions acceptable to us, or at all, this may materially and adversely affect
our Business.
Chemical Production Operations at the New Gongxing Site, Phase 2 Land
As at the Latest Practicable Date, although we have signed a letter of intent with the Mianzhu
Resettlement Ofce and paid a partial deposit of RMB 8 million in respect of Phase 2 Land, the
Mianzhu Land Bureau has yet to conduct the (bid invitation), or the (auction or
quotation process), and we have not obtained the relevant land use rights. Currently Mianzhu Norwest
has temporarily relocated certain of the equipment, machinery and storage facilities from the Previous
Hanwang Facilities to Phase 2 Land, and has also conducted some nal-stage STPP processing. Under
the relevant PRC laws, we are not allowed to occupy or use land or construct any buildings on Phase
2 Land without proper approvals and/ or permits from the competent authorities, and in the event that
we are unable to obtain such land use rights on a timely basis, on conditions acceptable to us, or at all,
44
RISK FACTORS
we may be required to (i) cease any processing and/ or Chemical Production Operations; (ii) remove
any equipment and machinery; (iii) vacate and return the Phase 2 Land; (iv) demolish any buildings
or installations within a certain time limit, and conduct restoration works; (v) have our buildings and
installations conscated; and/ or (vi) pay certain nes or penalties.
Further, in order to commence Trial Chemical Production Operations and subsequently, Commercial
Chemical Production Operations at our facilities on Phase 2 Land, we will be required to obtain, inter alia,
the (environmental trial production approval), the (record of safety
test run plan), the Chemical Safety Production Permit, and the Pollution Discharge Permit. If we are
unable to obtain such permits, certications and/ or licences on a timely basis, on conditions acceptable
to us, or at all, this may materially and adversely affect our Business.
In addition, changes in legislation and regulations or changes in the interpretation or implementation of
the relevant legislation and regulations could also result in consequences which would materially and
adversely affect our Business.
Please refer to the sections entitled General Information on our Group - Properties and Fixed Assets,
General Information on our Group - Permits, Licences, Approvals and Government Regulations and
General Information on our Group - Legal Opinion from King & Wood Mallesons of this Offer Document
for more details of the permits, licences and approvals that we have obtained and may be required to
obtain for our business and operations.
We are dependent on the availability of reliable transport access for our phosphate rocks and
phosphate-based chemical products
We depend on reliable transport access for the delivery of our (i) phosphate rocks from our Mines to our
processing facilities; and (ii) phosphate-based chemical products to our customers from our processing
facilities. We plan to increase production capacity and sales of phosphate rocks and phosphate-based
chemical products. This increase in production will lead to an increase in the utilisation of the access
roads leading to our Mines, and the paved roads and provincial highways connecting the New Gongxing
Facilities and our customers. If we or the relevant authorities are unable to maintain the condition of
these roadways in a timely manner, or any of these roadways are signicantly damaged or cut off for an
extended period of time for reasons beyond our control such as vehicle breakdowns, oods, landslides
or mudslides, the delivery of our phosphate rocks and phosphate-based chemical products would be
adversely affected.
The proposed Mian Mao Highway, which is expected to increase accessibility between our Mines and
the New Gongxing Site once it is completed, has been under construction since September 2009 and
is expected to be completed around 2015/2016. Construction of the proposed Mian Mao Highway (the
Construction Works) may cause blockages or obstruction, for temporary or extended periods, to the
road transportation networks that link our Mines to the New Gongxing Facilities and to our customers.
For example, in late March 2013, certain segments of the roads used by Mianzhu Norwest had to be
closed for part of the day for two (2) weeks for the Construction Works. Our Mining Operations were
minimally impacted as we were able to reschedule our workers work plan and did not make use of the
roads during those periods of closure. However, there is no certainty that any future road closure(s) to
facilitate the Construction Works will not signicantly impact the roads used by Mianzhu Norwest.
In such event, if we are unable to utilise any alternative transport methods or transportation networks to
deliver our phosphate rocks, our operations will be substantially affected or disrupted and this may have
an adverse effect on our Business.
In addition, as transportation costs and timeliness of delivery are important considerations to our
customers, any material increase in transportation costs or delays in delivery may have an adverse effect
on our Business.
45
RISK FACTORS
Our revenue and/ or protability achieved in a nancial year or period is not an accurate indicator
of our revenue and/ or protability that may be achieved in a subsequent nancial year or period
Our revenue and/ or protability in a given nancial year or period is dependent on various factors such
as, inter alia, the availability of our resources, seasonality of our operations, market sentiment, market
competition and general economic conditions. In addition, our revenue and/ or protability may also be
adversely affected by disruptions to our Mining Operations and/ or Chemical Production Operations
due to natural disasters, adverse weather conditions and other unforeseen difculties. In particular,
our operations were substantially halted after the Wenchuan Earthquake and without the government
subsidies and compensation pursuant to the Relocation Exercise, our protability in FY2011 would have
been lower and we would have recorded a loss in FY2012.
We have yet to commence Commercial Chemical Production Operations at the New Gongxing Facilities.
In addition, the New Gongxing Facilities are being built to different specications than the Previous
Hanwang Facilities. Accordingly, our revenue, cost of sales, and other costs relating to the operation
and maintenance of the New Gongxing Facilities, once operational, will be different from that of the
Previous Hanwang Facilities. The revenue and costs associated with the production of phosphate-based
chemical products at the Previous Hanwang Facilities for the Period Under Review cannot be taken as
an indication of the revenue and costs which will be associated with the production of phosphate-based
chemical products at the New Gongxing Facilities, once it commences operations.
In view of the foregoing, the historical nancial performance and nancial position of our Group for
FY2010, FY2011, FY2012 and FP2013 may not be indicative of our future nancial performance and
nancial position.

We have experienced negative cash ow and negative working capital
We recorded negative net cash ow from operating activities of S$0.2 million, S$1.6 million and
S$1.5 million in FY2011, FY2012 and FP2013 respectively. In FY2010, we commenced the recovery
stage of our Mining Operations and sold our initial phosphate rocks in late FY2010. In FY2011, we
also accumulated phosphate rocks from our Mines in anticipation of the temporary cessation of Mining
Operations during the winter season. The negative net cash ow from operating activities in FY2011 was
mainly due to an increase in stock and receivables as well as decrease in payables. Our Group also
accumulated phosphate-based chemical products produced by our Previous Hanwang Facilities in order
to continue supplying to certain customers after the Relocation Exercise in FY2012. In FP2013, in view
of the expected commencement of production of P
4
, our Group selected better quality phosphate rocks to
be kept as inventory for subsequent use in its P
4
production and sold the lower quality phosphate rocks
which generally fetch lower prices. The negative net cash ow from operating activities in FY2012 and
FP2013 was mainly due to repayments by our Group and increase in advances to suppliers and other
prepayments. The shortfall in cash ow for FY2011, FY2012 and FP2013 was nanced mainly through
loans and capital injections from Eastcomm.
We recorded negative working capital positions of S$3.0 million, S$3.7 million, S$1.9 million and S$0.06
million as at 31 December 2010, 2011, and 2012, and 31 March 2013 respectively. The negative working
capital positions as at 31 December 2010, 2011 and 2012, and 31 March 2013 were mainly due to the
capital expenditure in connection with the Rebuilding Programme. The capital expenditure was nanced
by loans and capital injections from Eastcomm.
For more details, please refer to the section entitled Managements Discussion and Analysis of Results
of Operations and Financial Position - Liquidity and Capital Resources of this Offer Document.
If we are unable to obtain sources of funds on a timely basis, on conditions acceptable to us, to address
our negative net cash ow from operating activities and/ or working capital shortfall, our Business may be
adversely affected.
As we continue to expand and grow our business and operations, there can be no assurance that we will
not experience negative net cash ow from operating activities and/ or negative working capital positions
in the future.

46
RISK FACTORS
The prices of our phosphate rocks and phosphate-based chemical products may experience
signicant uctuations due to, inter alia, factors beyond our control
Our Business is dependent on, inter alia, the prices of our phosphate rocks and phosphate-based
chemical products, which are in turn affected by market forces of demand and supply, as well as
numerous other factors that are beyond our control and are inherently unpredictable.
For instance, the demand for phosphate rocks and phosphate-based chemical products may be adversely
affected by global economic downturns, prices of commodities, expectations with respect to the rate of
ination, exchange rates, increases of supply by competitors, alternative product development, global
and regional political and economic conditions and governmental policies with respect to the use and/ or
import and export of phosphate and its related products.
Supply of phosphate rocks and phosphate-based chemical products may be affected by the capacities
of current mines and rising market prices of phosphate to a level that may encourage additional capital
expenditure to expand production capacity.
The occurrence of any of these factors may affect demand and/ or supply, and the prices of our
phosphate rocks and phosphate-based chemical products may uctuate. This may in turn result in an
adverse effect on our Business.
We are subject to changes in applicable government policies governing the industries to which
we supply our phosphate rocks and phosphate-based chemical products
We may be affected by government policies affecting industries to which we supply our phosphate rocks
and phosphate-based chemical products. Government policies may be implemented to impose price
restrictions or export duties in order to preserve domestic supply in the industries to which we supply our
phosphate rocks and phosphate-based chemical products. Additionally, certain countries have imposed
bans and/ or limits on the use of phosphate-based chemicals in detergents in the past years. Certain
countries are also now considering whether to extend bans and/ or limits to encompass industrial and
institutional use of detergents and to further reduce phosphate levels in soap for dishwashers.
A change in or tightening of applicable government policies governing the industries to which we supply
our phosphate rocks and phosphate-based chemical products could have an adverse effect on our
Business.
Currently, our Groups sale of phosphate rocks is conned to the PRC, as we do not possess the relevant
licence required by the PRC government to sell phosphate rocks overseas.
An example of an industry that may be susceptible to the imposition of government policies is the
domestic market for fertilisers in the PRC. Demand for and prices of fertilisers in the PRC, which is
generally produced using phosphate rocks as one of its key raw materials, have historically been
inuenced by export duties imposed by the PRC government on certain fertilisers to preserve domestic
supply. Any export duties imposed by the relevant authorities could exert pressure on producers of
fertilisers to minimise production quantities, thereby depressing the purchase price of phosphates at
which these producers are willing to pay. As phosphate rocks are mainly used for production of fertiliser
and feed, the imposition of such government policies in the PRC market for fertilisers may depress the
prices at which we are able to sell our phosphate rocks, thereby adversely affecting our Business.
We are dependent on our ability to obtain, maintain and/ or renew licences, permits and approvals
from the relevant PRC government authorities in relation to our Mining Operations, exploration
activities and Chemical Production Operations
Under the (Mineral Resources Law of the PRC), all mineral resources in
the PRC are owned by the State. We require certain licences, permits and approvals from the relevant
PRC authorities and regional governments to carry out our Mining Operations, exploration activities and
Chemical Production Operations in the PRC. These licences, permits and approvals are also limited to
specied areas and time periods and govern our mining, exploration and chemical production activities,
including our ability to deal with the phosphate rocks extracted from our mining and exploration sites.
Our ability to carry on our Mining Operations, exploration activities and Chemical Production Operations
47
RISK FACTORS
is therefore subject to our adherence to and/ or interpretation of any conditions imposed under such
licences, permits or approvals, and/ or our ability to obtain, maintain and/ or renew, as the case may be,
such licences, permits and approvals from the relevant PRC government authorities in a timely manner.
For further details, please refer to the section entitled General Information on our Group - Permits,
Licences, Approvals and Government Regulations of this Offer Document.
The application process for such licences, permits and approvals may be complex, due to the various
levels of PRC government that may need to be involved. There can be no assurance that we will be able
to obtain, maintain and/ or renew our licences, permits or approvals in a timely manner, if at all, or that
such licences, permits and approvals will not be subsequently revoked by the relevant PRC authorities.
We may also be required to obtain additional licences, permits and approvals pursuant to new PRC laws
and regulations that may be promulgated in the future. Failure to obtain, maintain and/ or renew such
licences, permits and approvals may cause us to delay or halt our production or expansion plans, thereby
adversely affecting our Business. In particular, in the event that we identify prospective mine resources
for acquisition in the future, there can be no assurance that mining rights can be successfully obtained.
There can also be no assurance that the interpretation of conditions imposed under such licences,
permits or approvals will remain unchanged, and any such changes may adversely impact our Business.
We may not be able to operate efciently and effectively in the event that we lose key personnel
and/ or we are unable to attract and retain skilled workers
The responsibility of managing the strategic and operational aspects of our Group depends substantially
on a number of our key personnel and skilled workers. We face keen competition in the recruitment and/
or retention of these key personnel and skilled workers.
We have an experienced management team with relevant experience in their respective areas of
expertise, in particular our CEO and Executive Director, Dr. Ong Hian Eng, our Executive Director, Simon
Ong, and our Key Executive, Wang Xuebo, who are each responsible for, inter alia, overseeing the
strategic growth and managing the day-to-day operations of our Group. The loss of the services of any of
our key personnel without suitable timely replacements may adversely affect our Business.
In addition, we expect to require more skilled engineers, technicians, chemical experts, mining workers
and operators of specialised equipment with the expansion of our Mining Operations and Chemical
Production Operations. A shortage of such skilled labour may lead to increases in labour costs and in the
event that we are unable to pass on any such increases in labour costs to our customers, our Business
may be adversely affected.
There can be no assurance that our key personnel and skilled workers will continue to be employed
by us, and/ or that we will be able to attract and retain key personnel or skilled workers in the future.
Any inability by us to attract, recruit and train skilled workers and/ or retain key personnel and/ or skilled
workers could materially and adversely affect our Business.
We may not be adequately insured against our operational risks
We face various risks in connection with our operations. While we have taken up social insurance and
commercial insurance coverage including coverage for our mining workers and our key equipment,
we cannot assure you that such insurance coverage is sufcient to insure us against all of the types
of business risks and hazards we may face, such as loss of key personnel, business interruption and
third party liability insurance against claims for environmental disaster, property damage, personal injury
and environmental liabilities. We have limited insurance coverage in relation to the occurrence of natural
disasters or acts of God. Any losses and liabilities for which we are not insured or our insurance coverage
is inadequate to cover the entire liability may have an adverse effect on our Business.
48
RISK FACTORS
While we have implemented various safety policies and adopted safety measures, we cannot assure you
that the safety policies and measures we have in place for our operations will be sufcient to mitigate
or reduce industrial accidents. We also cannot assure you that casualties or accidents will not occur or
that our insurance coverage would be sufcient to cover costs associated with major accidents. Also, we
cannot predict the continued availability of insurance coverage at premium levels that are acceptable to
us, or at all. In the event that we incur substantial losses or liabilities and our insurance does not cover
such losses or liabilities adequately or at all, our Business may be adversely affected.
Please refer to the section entitled General Information on our Group - Insurance of this Offer Document
for further details.
We may be subject to increases in our operating costs
Mining costs generally increase over the lifespan of a mine. In addition, labour, diesel, raw materials and
utilities costs in the PRC have been increasing in recent years and are generally expected to increase
further. Due to our dependence on the supply of labour and electricity for our Chemical Production
Operations, we are sensitive to any increase in labour and other costs and prices of utilities and raw
materials. Expansion of our production capacity, sales and existing network of customers in the PRC and
other countries will also increase the overall operating costs of our Group.
Labour costs in the PRC have also been increasing due to, inter alia, changes in applicable PRC labour
laws. In June 2007, the National Peoples Congress of the PRC enacted the Labour Contract Law
which became effective on 1 January 2008 (and was subsequently amended on 28 December 2012).
The Labour Contract Law formalised workers rights concerning overtime hours, pensions, layoffs,
employment contracts and the role of trade unions. The Labour Contract Law also imposes comparatively
greater liabilities on employers which will increase the cost of an employers decision to reduce its
workforce. In addition, we face increased hiring costs of our workers due to demand for workers from our
competitors.
Our protability may be affected in the future due to any potential or unforeseen increase in our operating
costs, such as new or additional tax levies. If our operating costs increase and we cannot increase our
production efciency to offset any such increase or pass any such increase on to our customers, our
Business may be adversely affected.
Our future growth will depend on our ability to manage our expansion plans
The business strategies and future plans of our Group include (i) further Mining Operations and
exploration activities to increase phosphorite resources and output; (ii) adopting a vertically-integrated
strategy; (iii) rebuilding, enhancing and increasing the capacity of our Chemical Production Operations;
(iv) increasing our portfolio of phosphate-based chemical products; and (v) expanding through
acquisitions, joint ventures and strategic alliances. Please see the section entitled General Information on
Our Group Business Strategies and Future Plans of this Offer Document for further details.
There can be no guarantee that the implementation and execution of such business strategies and future
plans will be successful as these (i) involve a number of risks and uncertainties; (ii) are subject to the
then-prevailing economic conditions being conducive for such strategies to be in place; (iii) are dependent
on approvals from governmental and regulatory authorities; (iv) are dependent on our ability to secure
sufcient external funding for capital and other nancial requirements; and/ or (v) are based on our ability
to attract relevant qualied persons to support our business growth.
In the event that the revenue generated by our future plans is lower than expected, the costs associated
with such plans are higher than expected, we are unable to secure sufcient external funding, unable
to attract relevant qualied persons to support the requirements of our increased scale of operations,
and/ or the commencement of these planned expansions is delayed or aborted, we may be unable to
recoup our investment and/ or may suffer losses. As a result, our Business may be adversely affected.
49
RISK FACTORS
We are exposed to the creditworthiness of our customers
Our performance is dependent on the creditworthiness of our customers. Material default in payment
by our major customers may adversely affect our nancial performance and cash ow. We are unable
to assure you that there will be no risk of default by our customers in the future, or that we will not
experience cash ow problems as a result of such default. Should these events occur, our Business may
be adversely affected.
We face intense competition from our competitors
We face competition from both domestic and foreign competitors who are also engaged in similar
businesses. Certain competitors may have access to more resources, be better-positioned to pursue new
expansion and development opportunities, and/ or possess competitive advantages, including control
over or access to low-cost raw materials, access to low-cost credit, geographical proximity to suppliers or
customers and relationships with global market participants. These competitors may also compete with us
for skilled labour required for our Mining Operations and Chemical Production Operations.
In the event that we are not able to compete effectively against our competitors, both the sales and the
pricing of our products may be adversely affected, which in turn may have an adverse effect on our
Business.
We may not be able to successfully implement our capital expenditure programme
Our Mining Operations and Chemical Production Operations are capital-intensive businesses. We have
in the past funded and may continue to fund our capital expenditure programme primarily through, inter
alia, cash ow from operations, equity injections, shareholder borrowings and short-term bank loans.
However, we may not be able to generate adequate cash ow from our current operations and external
funding may not be available at the level required by our Group, on a timely basis, on terms acceptable
to us, or at all. In the event that we are unable to nance planned capital expenditures, or nance such
expenditures on terms acceptable to us, some or all the projects in our pipeline may not be implemented
according to schedule, or at all. There can also be no assurance that we will be able to obtain, renew
or maintain the requisite licences, permits and/ or approvals for our Rebuilding Programme, on a timely
basis, or at all. Our growth may be constrained, expected efciency gains from the construction of new
facilities may not be achieved and any growth prospects based on the assumption that these projects
complete may not materialise. If any of the above-mentioned events occur, our Business may be
adversely affected.
In addition, we may face difculties in hiring suitably qualied personnel to carry out the implementation
of our capital expenditure projects. We may also face uncertainties in the implementation of our capital
expenditure programme such as non-completion, cost overruns and defects in design or construction,
which may result in additional investments being required. Further, we may rely on third party contractors
for the implementation of our capital expenditure programme. In the event that such third party
contractors cease operations without giving us prompt notice, we could incur costs and experience delays
if we are unable to nd a suitable replacement promptly.
As at the Latest Practicable Date, we have completed the construction of the P
4
Plant at the New
Gongxing Site under Phase 1 of the Rebuilding Programme, and are in the preliminary stages of Phase
2 of the Rebuilding Programme. Please refer to the section entitled General Information on our Group
Business Overview of this Offer Document for further details. If any or all of the major projects that
constitute our capital expenditure programme are not implemented according to schedule or at all, the
efciency gains from the New Gongxing Facilities may not be achieved and any growth prospects based
on the assumptions that the projects are completed may not materialise. There also can be no assurance
that management estimates of efciency gains will be realised and/ or achieved, if at all. New operations
may be prone to unexpected problems during the initial development phase. Such occurrences could
result in damage to properties or processing facilities, interruptions in production, injury or casualties,
monetary losses and legal liabilities. In such an event, our Business may be adversely affected.
We will need to obtain further nancing for our future growth
We will have to fund the capital expenditure and operating costs required for our Mining Operations. We
may also require additional funding for our growth plans. We have estimated our funding requirements in
order to implement our growth plans as set out in the section entitled General Information on our Group
Business Strategies and Future Plans of this Offer Document.
50
RISK FACTORS
In the event that the costs of implementing our growth plans should exceed our funding estimates
signicantly or that we come across opportunities to grow through expansion plans which cannot
be predicted at this juncture, and our funds generated from our operations prove insufcient for such
purposes, we may need to raise additional funds to meet these funding requirements. We will consider
obtaining such funding from new issuance of equity, debt instruments and/ or external bank borrowings,
as appropriate. In addition, we may need to obtain additional equity or debt nancing for other business
opportunities that our Group deems favourable to our future growth and prospects. Funding through the
new issuance of equity will lead to a dilution in the interests of our Shareholders. An increase in debt
nancing may be accompanied by conditions that restrict our ability to pay dividends or require us to seek
lenders consent for payment of dividends, or restrict our freedom to operate our business by requiring
lenders consent for certain corporate actions. In addition, there is no assurance that we will be able to
obtain additional nancing on terms that are favourable and acceptable to us, or at all. If we are not able
to secure adequate nancing on a timely basis or at all, our Business may be adversely affected.
We may incur impairment losses related to operating assets, which may adversely affect our
nancial performance
In accordance with our accounting policy, the carrying amount of our operating assets, including property,
plant and equipment and Mines, are reviewed for impairment when events or changes in circumstances
indicate that the carrying amount may not be recoverable. Estimating the value in use requires us to
estimate cash ows from the cash-generating units and to choose a suitable discount rate in order to
calculate the present value of those cash ows. Any material decrease in the amount of our projected
cash ows may result in impairment on the carrying value of property, plant and equipment and Mines,
which may adversely affect our nancial performance.
Terrorist attacks, armed conicts, and/ or outbreak of Severe Acute Respiratory Syndrome
(SARS), avian inuenza, H1N1, H7N9 and/ or other communicable diseases, may affect the
markets in which we operate and our business and operations
The effects of terrorist attacks or armed conicts may materially and adversely affect our Business or
those of our suppliers or customers. Such terrorist attacks or armed conicts could have an adverse
impact on the demand for our products and our ability to deliver products to our customers in a timely
and cost-effective manner, which in turn could have an adverse impact on our Business. Political and
economic instability in some regions of the world may also result from such terrorist attacks and armed
conicts, and could negatively impact our Business. The consequences of any of these terrorist attacks or
armed conicts are unpredictable, and we are not able to foresee such events that could have an adverse
impact on our Business.
An outbreak of contagious disease may have an adverse effect on the economies of certain Asian
countries and may materially and adversely affect our Business.
For example, in the rst half of 2003, certain countries in Asia experienced an outbreak of SARS, a highly
contagious form of atypical pneumonia. In 2009, there was a global outbreak of a new strain of inuenza
A virus sub-type H1N1. In the last few years, large parts of Asia experienced unprecedented outbreaks
of avian u. In 2013, a deadly strain of inuenza A virus sub-type H7N9 was reported in the PRC. These
infectious diseases seriously interrupted economic activities and general demand for goods plummeted in
the affected regions.
There can be no assurance that an outbreak of SARS, avian u, H1N1, H7N9 or other contagious
diseases, or the measures taken by the governments of affected countries against such potential
outbreaks, will not seriously interrupt our operations or those of our contractors, suppliers and/ or
customers. This, in turn, may have a material adverse effect on our Business. The perception that there
may be a recurrence of an outbreak of SARS, avian u, H1N1, H7N9 or other contagious diseases
may also have an adverse effect on the economic conditions of countries in Asia and accordingly, our
Business.
51
RISK FACTORS
Our Business may be adversely affected by recent developments in the global markets
Since the global economic downturn in late 2008, there have been negative developments in the global
nancial markets including the downgrading by major international credit rating agencies of sovereign
debts issued by some of the European Union member countries and the difcult conditions in the global
credit and capital markets. These challenging market conditions have given rise to reduced liquidity,
greater volatility, widening of credit spreads, lack of price transparency in credit markets, a reduction in
available nancing, government intervention and lack of market condence. These factors, combined with
declining business and consumer condence, have resulted in global economic uncertainties.
It is difcult to predict how long these developments will last. Further, there can be no assurance that
measures implemented by governments around the world to stabilise the credit and capital markets will
improve market condence and the overall credit environment and economy. A global economic downturn
could adversely affect our ability to obtain short-term and long-term nancing. It could also result in an
increase in the cost of our bank borrowings and reduction in the amount of banking facilities currently
available to us. The inability of our Group to access capital efciently, on time, or at all, as a result of
possible economic difculties, may have an adverse effect on our Business. Any deterioration in the
global economy could in turn adversely affect the health of the local economy and impact our Business.
In the event that the global economic conditions do not improve or any recovery is halted or reversed, our
RISKS RELATING SPECIFICALLY TO OUR MINING OPERATIONS
We are materially dependent on our Mines for our Mining Operations
We expect our Mines to be our only operating mines in the near term and on which we will depend
substantially for our operating revenue and cash flow, and to support our Chemical Production
Operations. Any signicant operational or other difculties in the mining, processing or transport of
phosphate rocks from our Mines to the New Gongxing Facilities or to our customers may hinder our sales
and production of our phosphate rock and phosphate-based chemical products. In particular, we may face
difculties in the transportation of our phosphate rocks from our Mines owing to landslides and/ or other
environmental hazards. Our Chemical Production Operations may be disrupted if we are unable to secure
prompt alternative sources of phosphate rocks for our Chemical Production Operations. In the event that
our Group fails to derive the expected economic benets from our Mines due to any delay or difculty
in our operations, and/ or to optimise the capacity of our operations, our Business may be adversely
affected.
We may not be able to increase the approved annual production scale for our Mines
Currently, Mine 1 has an approved annual production scale of 50,000 tonnes per year and Mine 2 has an
approved annual production scale of 200,000 tonnes per year. We intend to apply for an increase in the
approved annual production scale for Mine 1 in 2013. In the event that we are unable to obtain approvals
for increases in the production scale on a timely basis, on terms acceptable to us, or at all for such an
increase, our Business may be adversely affected.
We may not be able to achieve the expected production output of our phosphate rocks based on
resource estimates
Our phosphorite resource estimates are based on, inter alia, certain estimation methodology and
procedures, various assumptions and professional engineering judgment. There can be no assurance that
the resource estimates will be accurate, or that the resource estimates will translate to proven reserves.
Resource estimates involve professional judgment based on factors such as technical data, experience
and industry practice. The accuracy of these estimates may be affected by many factors, including the
quality of the results of exploration drilling, sampling of the rocks, analysis of the rock samples, estimation
procedures and the experience of the person(s) making the estimates. Estimates of our phosphorite
resources may change signicantly when new information becomes available or new factors arise which
change the assumptions underlying the resource estimates. If the data on which the phosphorite resource
estimates are based on are later found to be unreliable, the accuracy of the estimates and information
may be compromised and the phosphorite resource estimates may not translate to proven reserves.
52
RISK FACTORS
A reduction of our phosphorite resource estimates may result in the lowering of the expected mining
lives of our Mines. Fluctuations in factors such as the prices of our products, production costs and
transportation costs, variation in recovery rates and unforeseen geological or geotechnical perils may
require us to revise our phosphorite resource data. If such revisions result in a reduction in recoverable
phosphorite resources at one or more of our Mines, our Business may be materially and adversely
affected.
We face risks and uncertainties associated with our Mining Operations
Our Mining Operations are subject to a number of operating risks and potential hazards normally
associated with the exploration and extraction of natural resources, some of which are beyond our
control. The occurrence of any operating risk and potential hazard could result in extraction shortfalls and/
or damage to persons or property. These operating hazards and risks include:
periodic interruptions of our Mining Operations due to inclement or hazardous weather conditions
(including ooding, mudslides and landslides) and natural disasters;
interruptions due to transportation disruptions and/ or delays;
accidents;
power or fuel supply interruptions;
unexpected maintenance or technical problems;
labour issues;
boundary disputes;
disputes with third parties (such as other mine owners, mining contractors and operators);
critical equipment failures in our Mining Operations; and
unusual or unexpected variations in the mine and its geological or mining conditions, such as
instability of the slopes and subsidence of the working areas.
In particular, our Mining Operations involve the handling and storage of certain dangerous articles
including explosives, and use of heavy machinery, which involve inherent risks that cannot be completely
eliminated through preventive efforts. The occurrence of any of these potential hazards could delay and
adversely affect our Mining Operations, increase production costs, result in environmental damage, and/
or result in casualties and/ or injury to our workers, damage to property and liability for our Group. Such
incidents may also result in breach of consents or approvals obtained from the relevant PRC authorities
for our Mining Operations and imposition of nes and other penalties on our Group.
Any disruption for a sustained period to the operations of our Mines may have a material adverse effect
on our Business. There can be no assurance that future accidents will not materially and adversely affect
our Business. The occurrence of any of these events, whether man-made or natural, could have an
We work with and rely on co-operation partners and third party advisers in our business
operations
Currently, we have co-operation arrangements with Dashan, Lomon Products and Lomon Chemicals.
Between 2006 and 2008, we signed various agreements and supplemental agreements with Dashan
in respect of co-operation arrangements for the Mines (collectively, the Dashan Co-operation
Agreements). Under our co-operation arrangement with Dashan, (i) Dashan shall, inter alia, assist
us in our application for the relevant exploration and mining rights and bear related fees, fund certain
other expenses arising from our Mining Operations and exploration activities and provide certain assets
(such as machinery and equipment) to Mianzhu Norwest for its Mining Operations; and (ii) in relation to
mining operations, our Group shall be responsible for, inter alia, the design and construction of the Mines,
sales of our phosphate rocks, employment and purchase of social insurance for miners (the Dashan
Arrangement).
53
RISK FACTORS
We entered into a co-operation agreement with Lomon Products in 2011. Our co-operation with Lomon
Products relates to jointly utilising, inter alia, the relevant facilities and main tunnel transportation system
to obtain phosphate rocks within such areas that fall within our respective mining rights.
We entered into a co-operation agreement with Lomon Chemicals in 2012. Our co-operation with Lomon
Chemicals mainly relates to, inter alia, access to Adit 1703, which is owned by Lomon Chemicals, for the
mining of phosphate rocks.
Please refer to the section entitled General Information on our Group Mining Operations - Co-operation
arrangements of this Offer Document for further details.
The success of these co-operation arrangements largely depends on maintaining a good long-term
working relationship with our co-operation partners, and the satisfactory performance and fullment of
obligations by them. Co-operation arrangements involve associated risks in that our partners may:
be unable or unwilling to full their obligations under the relevant co-operation agreements;
have a different interpretation of our co-operation arrangements which are set out in general terms;
have economic or business interests or goals that are inconsistent with ours;
take actions or omit to take any actions contrary to our instructions or requests or contrary to our
policies or objectives or good corporate governance practices or the law;
have disputes with us as to the scope of their responsibilities and obligations; or
encounter nancial difculties.
In addition, the co-operation of our partners may not always be forthcoming. Any disagreement we
may have with our co-operation partners may lead to a deadlock situation, which could materially and
adversely affect our Business. We cannot assure you that we will be able to resolve such disagreements
in a manner that will be in our interests, or at all, which could have an adverse effect on our Business.
For example, the Dashan Co-operation Agreements provide, inter alia, that if the enterprise nature of
Mianzhu Norwest is changed due to reform or other reasons, Mianzhu Norwest shall ensure (i) the
preferential rights of Dashan to participate in its reform or reorganisation; or (ii) the rights and obligations
of Dashan under the Dashan Co-operation Agreements remain unchanged. There can be no assurance
that Dashan will not construe the Dashan Co-operation Agreements so as to seek equity participation in
our Group pursuant to the Restructuring Exercise, our listing and/ or any future corporate exercises, and
in such event, existing shareholders interest may be diluted and our Business may be adversely affected.
We also work closely with third party advisers and consultants in our Mining Operations. For example,
we engage third party PRC-licensed geological companies from time to time to carry out inspections as
and when the exploration rights that we currently hold are due to be renewed or extended. As a result,
our Business may be affected by the performance of such third party advisers and consultants. Any
failure by such third party advisers and consultants to meet the applicable professional, quality, safety
and environmental standards could affect our Groups compliance with government rules and regulations
relating to exploration and may also result in increased costs for our Group, which in turn could have an
We may be unable to continue to discover additional phosphate deposits which can be mined
economically
The amount of phosphate deposits within the areas specied under our mining rights will decline as we
continue to mine. As such, our future success and growth in the medium to long-term will depend, in
part, on our ability to discover additional phosphate deposits, and convert our exploration rights to mining
rights where more phosphate deposits are discovered.
Exploration of mineral deposits is speculative in nature, and involves signicant risks which even a
combination of careful evaluation, experience and knowledge is unlikely to entirely eliminate. There can
be no assurance that the exploration activities will result in the discovery of new mineable reserves.
Substantial capital expenditure and time may be required during which the capital cost and economic
54
RISK FACTORS
feasibility may change. Further, production output may be different from the estimates made initially.
Whether mining of a phosphate deposit will be economically feasible depends on a number of factors
including the size and quality of a deposit, phosphate prices and applicable government regulations. The
effect of these factors cannot be accurately predicted, but any combination of them may result in our
Group not receiving adequate, or any, returns for exploration activities.
Further, we may have to convert our exploration rights to mining rights, and there can be no assurance
that we will be able to do so on a timely basis, on terms acceptable to us, or at all. There can be no
assurance as to the factors or criteria that may be considered, and the extent of discretion exercised, by
the PRC government in determining a mining right application.
Even in the event that exploration rights are converted to mining rights, there can be no assurance that
project terms will not be altered or that we will not be subject to additional conditions imposed by the
PRC government, or other relevant authorities.
If we are unable to discover new phosphate deposits and/ or convert our exploration rights to mining
rights, our Business may be adversely affected.
We may be subject to penalties, in respect of our Mining Operations for Mine 1 for FY2005, FY2006
and FY2007
We exceeded the annual approved production scale for Mine 1 for FY2005, FY2006 and FY2007.
Under PRC laws, the relevant competent land and resources department has the right to require a mining
company to suspend its operations and rectify the non-compliance within a certain period of time if, inter
alia, the mining company does not carry out its operations according to its approved development and
utilisation plan for its mines. For further details, please see the section entitled General Information on
our Group - Permits, Licences, Approvals and Government Regulations of the Offer Document.
In the event that penalties are imposed on us, or we are issued with any orders or notications by any
competent authorities to carry out any rectication work, or issued with any notices of suspensions in
respect of our Mining Operations, or our mining rights and certicates are revoked, our Business may be
adversely affected.
We may be subject to costs and risks associated with the monitoring, rehabilitation and
compliance with environmental laws and regulations
Environmental protection and rehabilitation requirements, including the submission of environmental
assessment reports, environmental management plans, rehabilitation plans and compliance with the
environmental monitoring requirements, may increase our costs and cause delays depending on the
nature of the activity to be permitted and the interpretation of applicable requirements implemented
by the permitting authority. It is possible that costs and delays associated with the compliance with
applicable laws, rules and regulations could affect our ability to proceed with the development or
operation of our Mines, which will have an adverse effect on our Business.
Our Mines have a nite life and will eventually be closed. Before a mine can be closed, a report for
closing the mine, and relevant documents including information on the mining operations, hidden
dangers, land reclamation and utilisation, and environmental protection must be prepared, and an
application for approval must be led with the competent authorities and in accordance with applicable
laws and regulations. In the event that our Mines are closed, we may face additional costs and risks
arising from mine closures including reforestation and reinstatement of land used for Mining Operations
to its original condition or compliance with other environmental protection or safety issues. The successful
completion of these tasks is dependent on our ability to adhere to applicable laws, rules and regulations
as may be implemented by the relevant government. The consequences of a difcult closure and/ or non-
compliance with applicable laws, rules and regulations may include increased and/ or unforeseen costs,
penalties and damage to the reputation of our Group. In such an event, our Business may be adversely
affected.
55
RISK FACTORS
RISKS RELATING SPECIFICALLY TO OUR CHEMICAL PRODUCTION OPERATIONS UPON
COMMENCEMENT OF OUR CHEMICAL PRODUCTION OPERATIONS
We may be adversely affected if we face any disruptions to the supply of power and other raw
materials
Our Chemical Production Operations depend heavily on the availability of power supply, as well as other
raw materials such as natural gas, electrodes, soda ash, silica and coke. There can be no assurance
that supplies of power as well as other raw materials will not be interrupted or that their prices will not
increase.
Since December 2012, the facilities for our Chemical Production Operations have been connected to the
electricity supply network of the (State Grid Corporation of China) (State Grid) and
we are charged based on the prevailing market rates. Cost of electricity constitutes a signicant portion of
our total costs of production, and electricity cost increases, for example during low-water periods, which
typically occur within the period from mid-November to mid-April, may adversely affect our Business. For
further details, please refer to the section entitled General Information on our Group - Seasonality of this
Offer Document.
In the event we experience disruptions in the supply of power or other raw materials to our processing
facilities, and we are unable to nd suitable replacement suppliers promptly or obtain alternative supplies
at prices acceptable to us to meet the shortfall, our Business may be adversely affected.
We face risks relating to environmental hazards and production safety associated with our
Chemical Production Operations
Our Chemical Production Operations are subject to risks normally associated with working with chemicals
and hazardous substances, such as spills, discharges or other releases of hazardous substances into
the environment. The occurrence of accidents involving our phosphate-based chemical products or
by-products, which may be ammable and/ or hazardous in nature, as the case may be, could result
in severe damage and/ or injury to persons and/ or property. In such an event, we may be subject to
equipment failures or shut-downs, litigations and/ or regulatory investigations, all of which could adversely
affect our Business.
We may be adversely affected by the imposition of any additional export duties, quotas and/ or
restrictions on our phosphate-based chemical products
Certain of our phosphate-based chemical products are subject to additional export duties and quotas
imposed by the PRC government. Please refer to Appendix H entitled Summary of Relevant PRC Laws
and Regulations to this Offer Document for further details on PRC laws relating to, inter alia, taxation and
fees.
In the event that any additional or new export duties or quotas are imposed on our products, our
We are subject to foreign exchange risks and uctuations
We are exposed to foreign exchange rate risks. Revenue for the exports of our phosphate-based
chemical products is denominated in US$ while our operating costs are mainly denominated in RMB
and S$. The proceeds to be raised from the Invitation will be denominated in S$ while our intended uses
of proceeds are likely to be denominated in RMB. To the extent that our revenue and operating costs
and/ or purchases are not entirely matched in the same currency and to the extent that there are timing
differences between invoicing and collection or payment, as the case may be, we are exposed to any
depreciation of US$ and/ or S$ against RMB. Any signicant depreciation of US$ and/ or S$ against RMB
could adversely affect the nancial performance and position of our Group.
56
RISK FACTORS
We are also subject to translation risks as our combined nancial statements are presented in S$ while
the nancial statement of our foreign subsidiary is prepared in RMB, its functional currency. For the
purposes of consolidating the results of our foreign subsidiary, the balance sheet of our foreign subsidiary
is translated from RMB based on the period or year end exchange rate for the relevant nancial period
or year. The prot or loss statement of our foreign subsidiary is translated using the average exchange
rates for the relevant nancial year or period. Any signicant depreciation of the S$ against the RMB will
adversely affect our nancial performance and position.
Moreover, our Shares are traded in S$. Accordingly, any uctuation in the exchange rates between the
currencies may have an impact on the value of our Groups reported earnings, NAV and other nancial
measures in S$ terms. This, in turn, may affect the market price of the Shares. It should also be noted
that the RMB is not a freely convertible currency.
King & Wood Mallesons has advised that, under the existing PRC foreign exchange rules and regulations,
payments of current account items, including prot distributions, interest payments and expenditures
related to business operations, are permitted to be made in foreign currencies without prior government
approval but are subject to certain procedural requirements. Strict foreign exchange controls continue
to apply to capital account transactions. Capital account transactions must be registered with and
approved by SAFE. Repayments of loan principal, distributions of returns on direct capital investment and
investments in negotiable instruments are also subject to restrictions.
As a result of controls described above, we cannot assure you that we will be able to remit monies or
prots to or from our PRC subsidiary in the form of dividends or otherwise.
Please refer to the section entitled Managements Discussion and Analysis of Results of Operations and
Financial Position Foreign Exchange Management, Accounting Treatment of Foreign Currencies of this
We may experience equipment failure or other interruptions in our Chemical Production
Operations
Our Chemical Production Operations depend on the operation of our equipment and production facilities,
for which we are in the process of obtaining the relevant approvals. The facilities may experience
various operational delays such as shut-downs, downtime or periods of reduced production as a result
of unanticipated malfunction owing to reasons including power shortages, equipment failure or defects.
In addition, the New Gongxing Facilities may be subject to unanticipated events such as re or natural
disasters including earthquakes, resulting in damage to persons and/ or property. Disruption at one part
of our facilities may also adversely affect production operations for other phosphate-based chemical
products.
In the event that such unanticipated events occur and cause delays to the operations of the New
Gongxing Facilities, and we are unable to resolve equipment failures and/ or nd suitable prompt
replacements for such equipment, our Business may be adversely affected.
We may not be able to consistently, if at all, develop new and/ or improved phosphate-based
chemical products, which are protable or commercially viable, and our customers may reduce
their demand for our phosphate-based chemical products in favour of substitutes
We may not be able to develop new and/ or improved phosphate-based chemical products to expand our
product range and improve the quality of our phosphate-based chemical products consistently, if at all.
There can be no assurance that our efforts will yield protable or commercially viable phosphate-based
chemical products. In addition, as the time frame for developing and the demand for new products are not
pre-determinable, we may have to abandon a potential product which is no longer marketable even if we
have invested signicant resources in the development of such product. Further, even if we are successful
in developing a new product, a signicant amount of time may lapse between our investment in that
product and the receipt of any related revenue. In addition, our phosphate-based chemical products also
compete with other substitutes for various applications. If a signicant portion of our customers are willing
to accept such substitutes, the demand for our products would decrease and the market price for our
phosphate-based chemical products may decline. This would adversely affect our Business.
57
RISK FACTORS
We may be subject to the imposition of new, or an increase in existing, trade barriers and
registration and other requirements in our principal export markets
The export of our phosphate-based chemical products may be subject to various trade barriers, such
as anti-dumping duties, tariffs and quotas in our export markets. These trade barriers could affect the
demand for our phosphate-based chemical products by effectively increasing the prices of our phosphate-
based chemical products compared to domestically available products. There can be no assurance as to
how such trade barriers will evolve and whether our export markets will implement new trade barriers, or
increase existing trade barriers. In such event(s), the demand for our phosphate-based chemical products
in our export markets may decrease, thereby adversely affecting our Business. Please refer to the section
entitled Managements Discussion and Analysis of Results of Operations and Financial Position
Principal Components of Our Combined Income Statement of this Offer Document for further details of
our sales by geographical region.
Registration requirement for exports into the European Union
To the best of our knowledge, the Registration, Evaluation, Authorisation and Restriction of Chemicals
(REACH) Regulation (EC) No 1907/2006, inter alia, requires companies manufacturing or importing
chemical substances into the European Union to register information on such substances in a central
database run by the European Chemicals Agency. Importers of our phosphate-based chemical products
in the European Union may have to and we may also be required to comply with the REACH regulations,
and if they or we are unable or unwilling to do so, we may experience a decrease in demand for our
phosphate-based chemical products within the European Union.
Imposition of import duties by the USA
In February 2007, the United States Department of Commerce commenced investigations pursuant
to allegations that SHMP was being sold, or was likely to be sold, at less than fair value in the USA.
Subsequently in March 2008, the United States International Trade Commission (USITC) determined
that anti-dumping rates should be imposed on all imports of SHMP from the PRC. In October 2009,
the USITC commenced similar investigations pursuant to allegations that certain phosphate products,
including STPP, were being sold, or was likely to be sold, at less than fair value in the USA. The USITC
later determined that there was no reasonable indication that an industry production of STPP in the USA
was materially injured, or threatened with material injury, by reason of imports from the PRC that were
alleged to be subsidised by the PRC government and sold in the USA at less than fair value.
If we sell products to the USA that are determined to be subject to the anti-dumping duties by the USITC,
we may have to pay the anti-dumping rates, which will reduce our protability.
There can be no assurance that the government of the USA or other governments will not initiate any
anti-dumping related investigations against the phosphate-based chemical products that we produce. In
particular, there is no assurance that the government of the USA or other governments will not re-initiate
or continue anti-dumping related investigations against PRC producers of STPP or any other phosphate-
based chemical products.
The imposition of new, or an increase in existing trade barriers and registration and other requirements in
our export markets may have an adverse effect on our Business.
We may be subject to penalties in respect of our Chemical Production Operations for FY2009,
FY2010 and FY2011
After the Wenchuan Earthquake, we produced minimal quantities of thermal phosphoric acid, SHMP and
STPP in FY2009, FY2010 and FY2011 at the Previous Hanwang Facilities, in order to continue supplying
to certain customers. Our Pollution Discharge Permit in respect of the Previous Hanwang Facilities was
renewed in January 2007 prior to the Wenchuan Earthquake, and expired in January 2008. Nonetheless,
the Mianzhu Environmental Bureau issued a letter dated 18 January 2012 stating, inter alia, that since
incorporation, the mining and the other production and operation activities of Mianzhu Norwest are in
compliance with relevant PRC environmental laws, rules and regulations.
58
RISK FACTORS
In the event that we are required to obtain a Pollution Discharge Permit, retrospectively or otherwise, but
are unable to do so on a timely basis, on terms acceptable to us, or at all, we may be required to pay
penalties and/ or cease operations and carry out rectication works. There is also no assurance that the
relevant authorities will not impose nes or penalties on us for the aforementioned production activities. In
such event(s), our Business may be adversely affected.
We may not be able to achieve expected sales of our phosphate-based chemical products
We intend to increase the production volume and range of our phosphate-based chemical products.
There is no certainty that the actual demand for our phosphate-based chemical products will meet our
expectations of a projected increase in the demand of our products.
In addition, there can also be no assurance that new phosphate-based chemical products developed by
us in the future will yield positive economic benets. If we fail to achieve our business objectives or sales
target, our Business may be adversely affected.
RISKS RELATING TO OUR OPERATIONS IN THE PRC
We are subject to economic conditions of the PRC which are subject to uncertainties that may
arise from changes in government policies and social conditions
We conduct substantially all of our business operations in the PRC. Furthermore, our Groups sale
of phosphate rocks is conned to the PRC, as we do not possess the relevant licence(s) required by
PRC laws, rules and regulations to sell phosphate rocks overseas. Therefore, our Business is sensitive
to the economic, political and legal environment in the PRC, and the PRCs overall GDP growth. The
PRC economy differs from the economies of most developed countries in many respects, including its
structure, its level of development, its growth rate, its control of foreign exchange and its allocation of
resources.

The economy of the PRC is still in the process of being transformed from a planned economy to a more
market-oriented economy. For the past two decades, the PRC government has implemented economic
reform measures emphasising utilisation of market forces in the development of its economy. Although
our Company believes these reforms will have a positive effect on its overall and long-term development,
we cannot predict whether changes in the PRCs economic and other policies will have any adverse
effect on our Business.
Introduction of new laws or changes to, or interpretation of, the existing laws by the PRC
government may signicantly affect our Business
Our business and operations in the PRC are governed by the legal system of the PRC. The PRC legal
system is a codied system with written laws, regulations, circulars, administrative directives and internal
guidelines. As the PRC legal system continues to evolve, the interpretations of many laws, regulations
and rules are not always uniform and enforcement of these laws, regulations and rules involves
uncertainties, which may limit legal protections available to us. Some of these laws and regulations are
relatively new, so the volume of published cases in relation to these laws and regulations are limited.
Some of the laws and regulations, and the interpretation, implementation and enforcement thereof are
still at an experimental stage and are therefore subject to policy changes. In addition, some regulatory
requirements issued by certain PRC government authorities may not be consistently applied. We cannot
predict the effect of future developments in the PRC legal system, including the promulgation of new
laws, changes to existing laws or the interpretation or enforcement thereof, or the pre-emption of local
regulations by national laws. Further, the PRC legal system is based on written statutes. Prior court
decisions may be cited for reference but have limited precedential value. Accordingly, the outcome of
dispute resolution may not be as consistent or predictable as in other more developed jurisdictions.
59
RISK FACTORS
For instance, as a result of changes in the PRCs foreign investment policy, foreign investment in
phosphate mines was re-classied from the encouraged category to the restricted category in the
revised Catalogue for the Guidance of Foreign Investment Industries (the Catalogue) in 2007, and
was retained in the restricted category in the revised Catalogue in 2011 (collectively, the Revised
Catalogue). According to relevant PRC laws, rules and regulations, the incorporation and changes
of a foreign investment enterprise involved in restricted industries shall be governed by the commerce
bureau/departments of a provincial or higher level. In order to obtain the relevant approvals from the
competent commerce bureau/department(s) for any changes, Mianzhu Norwest has to rst prepare the
application and all requisite supporting documents (the Documents) for submission to the Deyang
Commerce Bureau. The Deyang Commerce Bureau will then review the Documents and report to the
Sichuan Commerce Department if required under the relevant PRC laws, rules and regulations. Our PRC
subsidiary, Mianzhu Norwest, was incorporated in 1996. Since incorporation, all changes to Mianzhu
Norwest were approved by the Deyang Commerce Bureau. To clarify the impact of the Revised Catalogue
to our Group, we, together with the Legal Advisers to our Company on PRC Laws, King & Wood
Mallesons, have visited the Deyang Commerce Bureau and the (section chief) in charge of Mianzhu
Norwest has verbally conrmed that the Deyang Commerce Bureau is the competent authority to approve
any changes to Mianzhu Norwest.
If there are any further amendments to the laws and regulations or their interpretation or enforcement
which require Mianzhu Norwest to obtain approvals for all its future changes from the Sichuan Commerce
Department or higher authorities, we may incur additional compliance costs for our Group to obtain
such approvals. Further, there can be no assurance that such approvals will be granted promptly to us
or at all. In the event that we are or were required to obtain the approvals from the Sichuan Commerce
Department and/ or other higher level authorities and we are unable to do so on a timely basis, or on
terms acceptable to us, or at all, our Business may be adversely affected.
We are subject to applicable PRC laws and other regulations concerning environmental
protection, health and safety and other areas
We are subject to various national, provincial and local laws and regulations relating to mining,
environmental protection, land use, occupational health, production safety and other matters that govern
our operations. These impose inherent risks of liabilities in our operations.
Environmental protection
Environmental hazards may occur in connection with our operations as a result of human negligence,
force majeure or otherwise. Environmental events such as changes in the water table or landslides
could adversely affect our Mining Operations. The occurrence of any environmental hazard may delay
production, increase production costs, cause personal injuries or property damage, result in liability to us
and/ or damage our reputation.
We are subject to national, provincial and local laws, rules and regulations regarding environmental
matters, such as the treatment and discharge of hazardous wastes and materials. For example, we are
required to abide by applicable PRC laws, rules and regulations on the discharge of waste substances
into the environment.
In addition, we are required under the current PRC laws, rules and regulations to conduct our Mining
Operations in a manner that minimises the impact on the environment. We may be required to incur
signicant capital and maintenance expenditures in order to comply with these environmental protection
laws and regulations. Any failure by us to discharge our obligations could result in the imposition of nes
and penalties, damage in reputation, delays in production and/ or temporary or permanent closure of our
operations.
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RISK FACTORS
We are also subject to future changes in existing laws, rules or regulations or enforcement policies, or
further investigation or evaluation of the potential health hazards of some of our products or business
activities, which may result in additional compliance and other costs. Stricter laws and regulations, or
more stringent interpretations of existing laws, rules or regulations, may impose new liabilities on us,
reduce operating hours, require additional investment by us in pollution control equipment, or impede
the opening of new or expanding existing plants or facilities. We could be forced to conduct preventive or
remedial action(s), such as pollution control facilities, which could result in the incurrence of substantial
costs. Such costs, liabilities or disruptions in operations could adversely affect our Business.
Occupational health and safety
We are required to comply with applicable health and safety laws and regulations of the relevant PRC
authorities. Relevant government authorities regularly conduct safety inspections of the mines and
facilities of mining companies. Failure to pass the safety inspections may harm our corporate image,
reputation and the credibility of our management, and have a material adverse effect on our Business.
We may also be subject to nes, penalties or even suspension of operations.
Our operations are subject to manufacturing, operating and handling risks associated with the products
we produce and the products we use in our operations. In particular, our operations may involve the
transportation, handling and storage of explosives and other dangerous or hazardous materials in
customised storage tanks. We may encounter accidents, maintenance or technical difculties, mechanical
failures or breakdowns during the exploration, mining and production processes. We cannot assure you
that accidents such as res, equipment mishandling and mechanical failures which may result in property
damage, severe personal injuries or even fatalities will not occur during the course of our operations. The
occurrence of such accidents may disrupt or result in a suspension of our operations, increase production
costs, result in liability to us and harm our reputation and Business.
Labour
We are also required to comply with applicable PRC labour, social insurance and housing fund laws and
regulations. In the PRC, employers entering into a labour contract relationship with the workers shall
perform the duties stipulated under the relevant laws and regulations, including the execution of contracts
with employees, prompt payment of salaries, and contribution to the employees social insurance and
housing fund. Any failure by us in complying with the applicable labour, social insurance and housing fund
laws may subject us to penalties and liabilities under PRC laws and regulations, including but not limited
to issue of warnings and imposition of nes.
There can be no assurance that existing laws, rules and regulations in relation to, inter alia,
environmental, occupational health and safety, and labour, will not be amended in the future. Stricter laws
and regulations, or more stringent interpretation of existing laws and regulations, may impose additional
compliance requirements on us, such as reducing our operating hours, and altering our production
processes. We may even be required to incur additional investment in pollution control equipment and/ or
incur additional operating costs to comply with such additional requirements and regulations. Any failure
by us to comply with the changes to the laws, rules and regulations could result in the imposition of nes
and penalties, damage in reputation, delays in production and/ or temporary or permanent closure of our
operations. Such increase in costs of or disruptions in operations may adversely affect our Business.
We may be subject to any changes in the laws, rules and regulations relating to currency
conversion and tax in the PRC
Under the present unied oating exchange rate system, the Peoples Bank of China publishes a daily
exchange rate for the RMB based on the previous days dealings in the inter-bank foreign exchange
market. Under this unied oating exchange rate system, uctuations in the exchange rate of the RMB
against other currencies, are to a certain extent, subject to market forces. There can be no assurance that
the RMB will not be subject to devaluation or depreciation due to administrative or legislative intervention
by the PRC government or adverse market movements. A devaluation of the RMB may adversely affect
our cash ow position in the repayment of our foreign currency debt (if any) and the payment of dividends
on our Shares. Conversely, an appreciation of RMB could lead to a reduction in the prices of imported
products and negatively impact our competitiveness against foreign products within the PRC, thereby
lowering our protability and adversely affecting our Business.
61
RISK FACTORS
We may experience increased competition due to the PRCs entry into the World Trade
Organisation (WTO)
The PRC has gained entry into the WTO. We believe that trade tariffs and import controls of foreign
goods into the PRC may be lowered or removed over time, pursuant to the entry. A lowering of the import
tariffs and barriers will intensify competition and result in the inux of similar phosphate-based chemical
products from overseas. Such increase in competition may force us to lower our prices, resulting in
narrower prot margins. In such an event, our Business may be adversely affected.
Failure to comply with PRC regulations in respect of our PRC Employees (as dened below)
share awards may result in our Group and/ or such PRC Employees being subjected to nes and
legal or administrative sanctions
Pursuant to the relevant PRC laws, rules and regulations in respect of foreign exchange control, including
the (notice issued on 15 February
2012 by SAFE), eligible PRC employees who are granted share awards under the AsiaPhos Performance
Share Plan (the PRC Employees) are required to complete (i) foreign exchange registration for the
share awards with SAFE or its local branch(es) via a qualied PRC agent; and (ii) certain other
procedures (the SAFE Registration).
We are required to (i) appoint and/ or authorise a qualied PRC agent to complete the SAFE Registration
on behalf of our PRC Employees; and (ii) submit the requisite documents to SAFE or its local branch(es),
including evidentiary materials that prove the authenticity of the AsiaPhos Perfomance Share Plan and
letters of undertaking regarding the veracity of the employment relationship between the PRC Employees
and our PRC subsidiary.
If we, or our PRC Employees, fail to comply with relevant PRC laws, rules and regulations, we and/ or our
PRC Employees may be subject to nes and legal or administrative sanctions.
RISKS RELATING TO OWNERSHIP OF OUR SHARES
Investments in securities quoted on Catalist involve a higher degree of risk and can be less liquid
than shares quoted on the Mainboard of the SGX-ST
We have made an application for our Shares to be listed for quotation on Catalist, a listing platform
primarily designed for fast-growing and emerging or smaller companies to which a higher investment risk
tends to be attached as compared to larger or more established companies listed on the Mainboard of
the SGX-ST. An investment in shares quoted on Catalist may carry a higher risk than an investment in
shares quoted on the Mainboard of the SGX-ST and the future success and liquidity in the market of our
Shares cannot be guaranteed.
Market and economic conditions may affect the market price and demand for our Shares
Movements in domestic and international securities markets, economic conditions, foreign exchange rates
and interest rates may affect the market price and demand for our Shares. As our Shares will be quoted
in S$ on the SGX-ST, dividends, if any, in respect of our Shares will be paid in S$. Fluctuations in the
exchange rate between the S$ and other currencies will affect, inter alia, the foreign currency value of
the proceeds which a Shareholder would receive upon sale in Singapore of our Shares and the foreign
currency value of dividend distributions.
Future sale or availability of Shares may exert a downward pressure on our Share price
There will be 800,000,000 Shares immediately following the Invitation. Such Shares, except for those
under moratorium, may be sold in the public market in Singapore. The sale of a substantial number of our
Shares after this Invitation, or the perception that such sales may occur, could exert a downward pressure
on our Share prices. In addition, these factors may also affect our ability to raise capital through the issue
of additional equity securities. Except as otherwise described in the section entitled Share Capital and
Shareholders Moratorium of this Offer Document, there are generally no other restrictions on the ability
of our Shareholders to sell their Shares either on the SGX-ST or otherwise.
62
RISK FACTORS
There has been no prior market for our Shares and the Invitation may not result in an active or
liquid market for our Shares
Prior to the Invitation, there has been no public market for our Shares. Although we have applied to the
SGX-ST for the dealing and quotation of our Shares on Catalist, there is no assurance that an active
trading market for our Shares will develop or, if developed, will be sustained. There is also no guarantee
of the continued listing of our Shares.
The Invitation Price was determined following a book-building process by agreement among the Sponsor
and Underwriter, the Placement Agent, the Vendors and us, after taking into consideration, inter alia,
market conditions and estimated market demand for our Shares. The Invitation Price may not be
indicative of the market price for our Shares after the completion of the Invitation. Investors may not be
able to resell their Shares at a price that is attractive to them.
Our Share price may be volatile, which could result in substantial losses for investors purchasing
our Shares pursuant to the Invitation
The market price of our Shares may uctuate signicantly and rapidly as a result of, inter alia, the
following factors, some of which are beyond our control and may be unrelated or disproportionate to our
nancial results:
political, economic, nancial and social developments in the PRC and in the global economy;
perceived prospects, the general outlook of our industry, and success or failure of management in
implementing our business plans;
changes in general economic and stock market conditions;
changes in our operating results;
changes in securities analysts estimates of our nancial performance and recommendations;
announcements of gain or loss of signicant contracts, acquisitions, strategic partnerships, joint
ventures or capital commitments;
changes in market valuations and share prices of companies with businesses similar to our
Groups businesses that may be listed in Singapore or elsewhere;
uctuations in exchange rates;
ability to obtain or maintain regulatory approval for our operations;
addition or loss of key personnel; and
our involvement in material litigation.
We may require additional funding for our future growth
Although we have identied our future growth plans as set out in the sections entitled General
Information on our Group - Prospects and Trend Information and General Information on our Group -
Business Strategies and Future Plans of this Offer Document as the avenues to pursue growth in our
business, the net proceeds from the Invitation may not be sufcient to fully cover the estimated costs
of implementing all these plans. We may also nd opportunities to grow through acquisitions which
cannot be predicted at this juncture. Under such circumstances, secondary issue(s) of securities
after the Invitation may be necessary to raise capital. If new Shares are issued to new and/or existing
Shareholders after the Invitation, such shares may be priced at a discount to the then-prevailing market
price of our Shares trading on Catalist, and existing Shareholders equity interest may be diluted. If we fail
to utilise the new funds to generate a commensurate increase in earnings, our EPS will be diluted, and
this could lead to a decline in our Share price.
Furthermore, any additional debt nancing which we may undertake to raise the funds required to
develop these growth opportunities may, apart from increasing interest expense and gearing, contain
restrictive covenants with respect to dividends, future fund-raising exercises and other nancial and
operational matters. If we are unable to procure the additional funding that may be required, our growth or
nancial performance may be adversely affected.
63
RISK FACTORS
Future dilution may result due to capital requirements
Our working capital and capital expenditure needs may vary materially from those presently planned,
depending on numerous factors, including our marketing and distribution strategies, strategic alliances
and other factors which cannot be foreseen. If we do not meet our goals with respect to revenues, or
costs are higher than anticipated, substantial additional funds may be required. Even if we exceed our
goals, our success may introduce new opportunities that may have to be fullled quickly and this could
also result in the need for substantial new capital. We may have to raise additional funds to meet the new
capital requirements. These additional funds may be raised through the issuance of new Shares. In such
events, if any Shareholder is unable or unwilling to participate in such fund raising, such Shareholder may
experience dilution in his investment.
We do not have a xed dividend policy and may not be able to pay any dividends in the future
We cannot assure you that we will pay dividends in the future or, if we pay dividends in the future, when
we will pay them. The declaration and payment of future dividends will depend upon our operating
results and cash ow, nancial condition, other cash requirements, including capital expenditures, the
terms of borrowing arrangements (if any), general economic conditions and other factors specic to the
industries that we operate in, many of which are beyond our control. Moreover, as we operate under a
holding company structure, the level of our income and our ability to pay dividends may depend upon the
receipt of dividends and distributions from our subsidiaries. The payment of dividends by our subsidiaries
is contingent upon many factors, including earnings and cash ows, and may be subject to legal,
contractual and/ or tax and accounting requirements in the relevant jurisdiction and other restrictions on
the payment of dividends under the terms of certain agreement(s). Please refer to the section entitled
Dividend Policy of this Offer Document for further details.
Negative publicity may adversely affect our Share price
Negative publicity involving our Group, any of our Directors, Key Executives or Substantial Shareholders,
may adversely affect the market perception or the stock performance of our Company, whether or not it
is justied. Some examples are unsuccessful attempts at joint ventures or takeovers, and involvement in
insolvency proceedings.
As a signicant portion of our operations and assets are located outside Singapore, investors
may nd it difcult to enforce a judgement against our Group.
A signicant portion of our Groups operations and assets are located outside Singapore. Accordingly,
Shareholders may encounter difculties if they wish to make a claim against our Group, or wish to
enforce a judgement against the assets of our Group.
You will incur immediate dilution and may experience further dilution in the NAV of your Shares
The Invitation Price is substantially higher than our Groups NAV per Share of 6.45 cents as at 31 March
2013 (as adjusted for the net proceeds from the issue of New Shares) and based on the post-Invitation
share capital of 800,000,000 Shares. Investors who subscribe for and/ or purchase our Shares at the
Invitation will therefore experience immediate and signicant dilution in the NAV of such Shares. Please
refer to the section entitled Dilution of this Offer Document for further details.
Our Controlling Shareholders will retain signicant control over our Group after the Invitation
which will allow them to inuence the outcome of matters submitted to Shareholders for approval
Upon completion of the Invitation, our Controlling Shareholders, namely Eastcomm, Astute Ventures, Dr.
Ong Hian Eng, Simon Ong, Raymond Ong and Melissa Ong, will benecially own approximately 69.5%
of our Companys post-Invitation share capital. As a result, our Controlling Shareholders will be able to
exercise signicant inuence over matters requiring the approval of Shareholders, including the election
of Directors and approval of signicant corporate transactions. Our Controlling Shareholders will also
have veto power with respect to any action of Shareholders requiring a majority vote except where they
are required by the Catalist Rules or other applicable laws, rules or regulations to abstain from voting.
Our Controlling Shareholders interests may not be aligned with our other Shareholders interests, and
they may cause us to, or prevent us from, entering into certain transactions, the result of which may
not be in, or may conict with, the interests of our other Shareholders. We cannot assure you that
our Controlling Shareholders will vote on Shareholders resolutions in a way that will benet all of our
Shareholders.
64
RISK FACTORS
Please refer to the section entitled Share Capital and Shareholders Shareholders of this Offer
Document for further details.
Investors may not be able to participate in future issues of our Shares
If we offer to our Shareholders rights to subscribe for additional Shares or any right of any other
nature, we will have discretion as to the procedure to be followed in making the rights available to our
Shareholders or in disposing of the rights and making available the net proceeds of such disposal to
our Shareholders. The decision made may not be to the benet of all Shareholders. We may choose
not to offer the rights to our Shareholders having a registered address outside Singapore. Accordingly,
Shareholders who have a registered address outside Singapore may be unable to participate in rights
offerings and may experience a dilution in their shareholdings as a result.
There may be a future sale or major divestment of our Shares by our Substantial Shareholders
The sale of a substantial number of our Shares after the Invitation, or the perception of such possible
sales, may adversely affect the market price of our Shares. Save as set out in the section entitled Share
Capital and Shareholders Moratorium of this Offer Document, there are generally no restrictions
imposed on our Substantial Shareholders selling or otherwise disposing of their shareholdings. Any major
disposal of our Shares by any of our Substantial Shareholders may cause the market price of our Shares
to decline.
In addition, future sales, or perceived sales, of a substantial number of our Shares may adversely affect
our ability to raise capital in the future at a time and a price favorable to us, and our Shareholders may
experience dilution of their holdings upon a future issuance or sale of additional securities.
The actual performance of our Group may differ materially from the forward-looking statements in
this Offer Document
This Offer Document contains forward-looking statements, which are based on a number of assumptions
subject to uncertainties and contingencies, many of which are outside of our control. Furthermore, our
revenue and nancial performance are dependent on a number of external factors, including demand
for our phosphate rocks and phosphate-based chemical products, which may decrease for various
reasons, such as increased competition within the industry or changes in applicable laws and regulations.
We cannot assure you that these assumptions will be realised and our actual performance will be as
projected.
65
EXCHANGE RATES AND EXCHANGE CONTROLS
EXCHANGE RATES
Our combined nancial statements are presented in S$ while the nancial statements of Mianzhu
Norwest are prepared in RMB, its functional currency. For the purposes of consolidating the results of
our foreign subsidiary, the balance sheet of Mianzhu Norwest is translated from RMB based on the
year-end or period-end exchange rate for the nancial year or period respectively, and the statement of
comprehensive income is translated at average exchange rates for the year or period which approximate
the exchange rates prevailing at the dates of the transactions.
The following table sets forth, for the nancial periods indicated, the exchange rate of RMB to S$1.00,
based on the average of the closing exchange rate on the last trading day of each month during each
nancial period or year and the closing exchange rate on the last trading day of the nancial period
or year. Where applicable, the exchange rates in the following table are used for our Groups nancial
statements disclosed elsewhere in this Offer Document:
RMB / S$1.00
Average
(1)
Closing
FY2010 4.975 5.123
FY2011 5.163 4.902
FP2012 5.000 5.033
FY2012 5.058 5.163
FP2013 5.081 5.066
The following table sets forth the highest and lowest exchange rates of RMB to S$1.00 for each month for
the six (6) months prior to the Latest Practicable Date, and indicates how much RMB can be bought with
S$1.00:
RMB / S$1.00
Highest Lowest
February 2013 5.057 5.003
March 2013 5.034 4.948
April 2013 5.027 4.961
May 2013 5.014 4.812
June 2013 4.949 4.792
July 2013 4.884 4.772
As at the Latest Practicable Date, the exchange rate was S$1.00:RMB4.818 (Exchange Rate).
The above exchange rates have been calculated with reference to exchange rates quoted from
Bloomberg L.P.
(2)
and should not be construed as representations that the RMB amounts actually
represent such S$ amounts, or could have been, or could be, converted into S$ at any particular rate, the
rate indicated above, or at all.
For the convenience of potential investors, certain parts of this Offer Document contain conversions of
RMB amounts into S$ and vice versa. Unless otherwise specied, the exchange rate used for these
conversions was S$1.00:RMB4.818.
Notes:
(1) The average exchange rates between RMB and S$ have been calculated using the average of the closing exchange rates on
the last day of each month during the relevant nancial period or year.
(2) Source: Bloomberg L.P.. Bloomberg L.P. has not provided its consent for the purposes of Section 249 of the SFA, to the
inclusion of the above information extracted from the relevant report published by it and therefore is not liable for such
information under Sections 253 and 254 of the SFA. While we and the Vendors have taken reasonable actions to ensure that
the relevant information has been reproduced in its proper form and context, neither we, the Vendors, nor any other party has
conducted an independent review or veried the accuracy or completeness of such information.
66
EXCHANGE RATES AND EXCHANGE CONTROLS
EXCHANGE CONTROLS
Singapore
As at the Latest Practicable Date, there are no Singapore governmental laws, decrees, regulations and
other legislation regarding the following:
(i) the import or export of capital, including the availability of cash and cash equivalents for use by our
Group; and
(ii) the remittance of dividends, interest or other payments to non-resident holders of our Companys
securities.
PRC
The PRC government imposes controls on the conversion of the RMB into foreign currencies. Under
the existing PRC foreign exchange rules and regulations, payments of current account items, including
prot distributions, interest payments and expenditures related to business operations, are permitted to
be made in foreign currencies without prior government approval but are subject to certain procedural
requirements. Strict foreign exchange controls continue to apply to capital account transactions. Capital
account transactions must be registered with and approved by SAFE. Repayments of loan principal,
distributions of returns on direct capital investment and investments in negotiable instruments are also
subject to restrictions.
In utilising the proceeds from the Invitation and any future offerings, as an offshore holding company
of our PRC subsidiary, we may make loans to our PRC subsidiary, or we may make additional capital
contributions to our PRC subsidiary. Any loans made to our PRC subsidiary are subject to PRC
regulations and approvals. For example, loans by us to our PRC subsidiary to nance its activities
cannot exceed statutory limits and must be registered with SAFE or its local counterpart. Any capital
contributions to our PRC subsidiary must be approved by the Ministry of Commerce in the PRC
or its local counterpart. In addition, on 29 August 2008, SAFE promulgated the Notice of the General
Affairs Department of the State Administration of Foreign Exchange on the Relevant Operating Issues
concerning the
(Improvement of the Administration of Payment and Settlement of Foreign Currency Capital
of Foreign-funded Enterprises) (the Circular 142) restricting how converted RMB may be used. For
example, Circular 142 requires that RMB converted from the foreign currency-denominated capital of our
PRC subsidiary may only be used for purposes within the business scope approved by the applicable
governmental authority and may not be used for equity investments within the PRC unless specically
provided for otherwise. Furthermore, Circular 142 strengthened the oversight of the ow and use of RMB
funds converted from the foreign currency-denominated capital of a foreign-invested enterprise. The use
of such RMB funds may not be changed without approval from SAFE, and may not be used to repay
RMB loans if the proceeds of such loans have not yet been used for purposes within the foreign-invested
enterprises approved business scope.
On 21 October 2005, SAFE promulgated the
(Notice of the State Administration of Foreign Exchange on Relevant Issues
concerning Foreign Exchange Administration for Domestic Residents to Engage in Financing and in
Return Investment via Overseas Special Purpose Companies) (the Notice 75) which came into effect
on 1 November 2005. Under Notice 75, PRC residents, including PRC enterprises and PRC resident
individuals, have to register their foreign investments with the competent local SAFE branch prior to
incorporating or taking control of a special purpose vehicle (the SPV). Furthermore, if there is any major
capital change without involving a round-trip investment of the SPV, such as an increase/decrease of
capital, share transfer, mergers or division, long-term equity or debt investments, and guarantees to a
foreign party, Notice 75 requires a PRC resident to amend its SAFE registration or le a record in a
competent foreign exchange bureau within 30 days from the date of the occurrence of the aforesaid
major capital change item. In addition, the foreign exchange income from prots, bonuses and capital
changes obtained by the PRC residents from the SPV shall be repatriated within 180 days from the date
of obtaining such income.
67
DIVIDEND POLICY
Statements contained in this section that are not historical facts are forward-looking statements. Such
statements are subject to certain risks and uncertainties which could cause actual results to differ
materially from those which may be forecast and projected. Under no circumstances should the inclusion
of such information herein be regarded as a representation, warranty or prediction with respect to the
accuracy of the underlying assumptions by us, the Vendors, the Sponsor and Underwriter, the Placement
Agent or any other person. Investors are cautioned not to place undue reliance on these forward-looking
statements that speak only as at the date hereof. Please see the section entitled Cautionary Notes
Regarding Forward-Looking Statements of this Offer Document.
We did not declare or pay any dividends in FY2010, FY2011, FY2012 and FP2013. We currently do
not have a xed dividend policy. The form, frequency and amount of declaration and payment of future
dividends on our Shares that our Directors may recommend or declare in respect of any particular
nancial year or period will be at their discretion and subject to the factors outlined below as well as other
factors deemed relevant by our Directors:
(i) the level of our cash and retained earnings;
(ii) our actual and projected nancial performance;
(iii) our projected levels of capital expenditure and expansion plans;
(iv) our working capital requirements and general nancing condition; and
(v) restrictions on payment of dividends imposed on us (if any).
Our Company is a holding company incorporated in Singapore under the Companies Act and our
business is operated primarily through our PRC subsidiary, Mianzhu Norwest. We rely mainly on
dividends from Mianzhu Norwest for our cash requirements. Therefore, our ability to pay dividends will be
affected by the ability of Mianzhu Norwest to declare and pay us dividends or other distributions.
The ability of Mianzhu Norwest to declare and pay dividends to us will be dependent on its cash income,
the cash available to it, its operating results, nancial condition, other cash requirements including
capital expenditures, its borrowing arrangements and other contractual restrictions applicable to it, and
restrictions under applicable laws, rules and/ or regulations.
The Legal Advisers to our Company on PRC Law, King & Wood Mallesons, have advised that Mianzhu
Norwest is entitled to remit dividends as long as Mianzhu Norwest complies with its articles of association
and meets all relevant conditions and requirements as may be required by PRC laws, rules, regulations
and all competent authorities, which mainly and materially provide that:
(i) Mianzhu Norwest shall retain a certain amount from its prots as reserve funds, bonus and welfare
funds for its workers and staff. The proportion of reserve funds to be retained shall not be lower
than ten per cent. (10%) of the total amount of prots after the payment of income tax, and such
retention may be stopped when the accumulated amount of reserve funds retained has reached
fty per cent. (50%) of the registered capital of Mianzhu Norwest. The proportion of bonus and
welfare funds for workers and staff to be retained shall be determined by Mianzhu Norwest;
(ii) Mianzhu Norwest and Norwest Chemicals shall duly pay the relevant taxes or fees in accordance
with applicable PRC laws, rules and regulations; and
(iii) Mianzhu Norwest shall obtain all necessary foreign exchange approvals for the dividend payment
(if required) and the remittance of the dividends shall be carried out by an authorised bank.
Furthermore, if Mianzhu Norwest incurs debt, the instruments governing the debt may restrict its ability to
pay dividends or make other payments to us. The inability of Mianzhu Norwest to distribute dividends or
other payments to Norwest Chemicals, and Norwest Chemicals to our Company, may limit our ability to
fund our working capital requirements.
68
DIVIDEND POLICY
Final dividends paid by us must be approved by an ordinary resolution of our Shareholders at a general
meeting and must not exceed the amount recommended by our Board. Our Directors may, without the
approval of our Shareholders, also declare an interim dividend. All dividends will be paid in accordance
with the Companies Act.
Information relating to withholding tax rates on dividends distributed by Foreign Investment Enterprises in
the PRC is set out in Appendix H entitled Summary of Relevant PRC Laws and Regulations - PRC Laws
Relating to Taxation and Fees to this Offer Document. Information relating to taxes payable on dividends
is set out in Appendix I entitled Taxation to this Offer Document.
69
CAPITALISATION AND INDEBTEDNESS
The following table shows our cash and cash equivalents, short-term debt and capitalisation of our Group
as at 31 July 2013 on an actual basis and as adjusted for the Restructuring Exercise and net proceeds
from the issue of New Shares pursuant to the Invitation.
You should read this table in conjunction with:
Appendices A, B and C entitled Audited Combined Financial Statements for the nancial years
ended 31 December 2010, 2011 and 2012, Unaudited Interim Condensed Combined Financial
Statements for the three months period ended 31 March 2013 and Unaudited Pro Forma
Combined Financial Information for the nancial year ended 31 December 2012 and the three
months period ended 31 March 2013 to this Offer Document respectively, and the related notes
and other nancial information contained therein; and
the sections entitled Managements Discussion and Analysis of Results of Operations and
Financial Position and Selected Combined Financial Information of this Offer Document.
As at 31 July 2013
Actual
As adjusted
for the
Restructuring
Exercise and
net proceeds
from the issue
of New Shares
pursuant to the
Invitation
(S$000) (S$000)

Cash and cash equivalents 1,013 22,565
Indebtedness
Interest-bearing bank loan - current
(secured, non-guaranteed) 1,024 1,024
Total shareholders equity 30,119 51,671
Total capitalisation and indebtedness 31,143 52,695
Borrowings
For the Period Under Review, our growth and operations were primarily nanced through a combination
of shareholders equity and loans, cash ow generated from operating activities, short-term bank
borrowings, government grants, compensation obtained from the local PRC authorities for, inter alia, the
Relocation Exercise, and assets and other forms of investments by Dashan, one (1) of our third party co-
operation partners.
7
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71
Save as disclosed above, as at the Latest Practicable Date, our Group does not have any banking or
credit facilities from nancial institutions, or other borrowings or indebtedness.
Operating Lease Commitments
As at the Latest Practicable Date, our Group has commitments for future minimum lease payments under
non-cancellable operating leases as follows:
As at the Latest
Practicable Date
(S$000)
Within one (1) year 180
After one (1) year 36
Total 216
The operating lease commitments relate to the lease of ofce premises at 600 North Bridge Road,
Parkview Square, #12-01, Singapore 188778, which is our principal place of business in Singapore, and
Unit F, 13th Floor, Xinshidai Guangchang, No. 42 Wenwu Road, Xinhua Avenue, Chengdu City, Sichuan
Province, which is our sales ofce in the PRC.
Capital Commitments
As at the Latest Practicable Date, our Group has the following capital commitments:
As at the Latest
Practicable Date
(S$000)
Purchase of plant and equipment 386
Purchase of land use rights 720
Total 1,106
The above capital commitments of our Group are expected to be nanced by internal cash resources,
bank borrowings and part of the net proceeds from the issue of New Shares.
Contingent Liabilities
As at the Latest Practicable Date, to the best of our knowledge, information and belief, we are not aware
of any contingent liabilities which may have a material effect on the nancial position and protability of
our Group.
Save as disclosed in this Offer Document, from 31 July 2013 to the Latest Practicable Date, there have
been no material changes in our total capitalisation and indebtedness except for changes in our retained
earnings arising from the day-to-day operations of our Group in the ordinary course of business.
Relocation Exercise, and assets and other forms of investments by Dashan, one (1) of our third party
co-operation partners. Under the Dashan Co-operation Agreements, Dashan is required to, inter alia,
provide certain assets (such as machinery and equipment) to Mianzhu Norwest for its mining operations
and fund certain other expenses arising from our mining and exploration activities. During the same
period, our principal uses of cash have been for working capital requirements and nancing our capital
expenditure. The net cash used in our operating activities and net cash used in investing activities have
been funded by the cash generated from our nancing activities. Please refer to the section entitled
Managements Discussion and Analysis of Results of Operations and Financial Position - Liquidity and
Capital Resources of this Offer Document for further details of the net cash ows generated from/ (used
in) operating activities and investing activities, and the net increase in cash and cash equivalents for the
Period Under Review.

72
We recorded negative working capital for the Period Under Review due mainly to the capital expenditure
incurred mainly in respect of the construction of the P
4
Plant and the outstanding shareholders loan taken
to part nance the cost of the Rebuilding Programme.

The government grants and proceeds from Relocation Exercise have been significantly utilised
in the Period Under Review. From FY2013 onwards, we do not expect to receive any signicant
benet from such government grants and proceeds. In addition, we have yet to commence Chemical
Production Operations. As at the Latest Practicable Date, we have completed the construction of the
P
4
Plant at the New Gongxing Site under Phase 1 of the Rebuilding Programme and are in the
preliminary stages of Phase 2 of the Rebuilding Programme. Our Group commenced trial production
of P
4
in FY2013. Hence, we do not expect any signicant revenue contribution from our Chemical
Production Operations in FY2013, until such time when the production and sale of P
4
commences on
a commercial scale. Furthermore, in view of the expected commencement of production of P
4
, we have
been progressively building up our inventory of phosphate rocks to be used for the production of P
4

while selectively selling phosphate rocks. As at 30 June 2013, we have approximately 100,000 tonnes of
phosphate rocks held as inventory.

As at 31 December 2012, we have cash and cash equivalents of approximately S$4.8 million, of which
approximately S$159,000 has been pledged. Based on approximately 100,000 tonnes of phosphate rocks
held as inventory as at 30 June 2013 and the average selling price of phosphate rocks for FY2012 of
approximately RMB445 per tonne, the market value of our inventory of phosphate rocks is approximately
RMB44.5 million (equivalent to approximately S$9.2 million based on the Exchange Rate). As at the
Latest Practicable Date, our committed but unpaid capital expenditure in relation to Phase 1 of the
Rebuilding Programme and Phase 2 of the Rebuilding Programme is approximately S$5.1 million. The
balance of the construction for Phase 2 of the Rebuilding Programme is proposed to be partly funded by
the net proceeds from the issue of the New Shares and no commitment has been made by our Group
for such construction activities or the construction of the ue gas storage facility for Phase 1 of the
Rebuilding Programme.
In view of the foregoing and taking into consideration the following:
(i) OCBC Bank has granted an overdraft facility of S$1,000,000 to our Company. The facility is
secured by a charge provided by Eastcomm (over its xed deposit account);
(ii) with the commencement of the production and sale of P
4
, our Group will generate revenue and
operating cash ows, which should improve our working capital position;
(iii) the development and expansion of our Mining Operations, the construction of the ue gas storage
facility and construction of Phase 2 of the Rebuilding Programme will be partly funded by the net
proceeds from the issue of the New Shares, and the extent and timing of such development and
expansion, and the Rebuilding Programme, can be adjusted in accordance with the completion of
and net proceeds raised from the issue of the New Shares; and
(iv) the Notes were issued by Eastcomm, not the Company. In the event that the Notes are to be
redeemed and monies repaid to the Noteholders, such obligations will rest with Eastcomm, not the
Company. The Companys only obligation is to allot and issue Consideration Shares (as dened
in the section entitled Restructuring Exercise of this Offer Document) to the Noteholders, if so
directed by Eastcomm. Please refer to the section entitled Restructuring Exercise of this Offer
Document for further details of the allotment and issuance of Consideration Shares,
our Directors are of the reasonable opinion that, after having made due and careful enquiry, our Group
will have adequate working capital available to us as at the date of lodgement of this Offer Document to
meet our Groups present requirements and for at least 18 months from the date of listing.
The Sponsor is of the reasonable opinion that, after having made due and careful enquiry and taking
into account all the above matters, our Group will have adequate working capital available to us as at the
date of lodgement of this Offer Document to meet our Groups present requirements and for at least 18
months from the date of listing.
73
DILUTION
Dilution is dened as the amount by which the Invitation Price paid by the applicants for our Invitation
Shares in this Invitation exceeds our NAV per Share immediately after this Invitation.
The unaudited NAV per Share as at 31 March 2013 before adjusting for the net proceeds from the issue
of the New Shares and based on the pre-Invitation issued share capital of 702,400,000 Shares was 4.28
cents per Share.
Pursuant to the Invitation, 97,600,000 New Shares will be issued at the Invitation Price of S$0.25 for
each New Share. The NAV per Share as at 31 March 2013 after adjusting for the estimated net proceeds
from the issue of New Shares and based on the post-Invitation issued and paid up share capital of
800,000,000 Shares would have been 6.45 cents per Share. This represents an immediate increase in
the NAV per Share of 2.17 cents per Share to our existing Shareholders and an immediate dilution in the
NAV per Share of 18.55 cents per Share or approximately 74.2% to new investors.
The following table illustrates such dilution on a per Share basis:
Invitation Price 25.00 cents
Unaudited NAV per Share before Invitation
(as at 31 March 2013)
4.28 cents
Increase in NAV per Share pursuant to the Invitation attributable to the existing Shareholders 2.17 cents
NAV per Share after the Invitation and as adjusted for the estimated net proceeds of the
New Shares
6.45 cents
Dilution in NAV per Share to new investors 18.55 cents
Dilution in NAV per Share to new investors 74.2 %
The following table summarises the total number of Shares acquired and directly held by our Directors,
Substantial Shareholders and the Noteholders since incorporation, the total consideration paid by them
and the average effective cost per Share paid by them and our new investors pursuant to the Invitation:
Number of
Shares
(after Share Split)
Total
consideration
(S$)
Average effective
cost per Share
(cents)
Directors
Dr. Ong Hian Eng 6,164,384 1,155,822 18.75
Simon Ong 2,919,306 547,370 18.75
Raymond Ong 2,919,306 547,370 18.75
Ong Bee Pheng

9,408,037 1,764,007 18.75
Hong Pian Tee
Goh Yeow Tin
Francis Lee
Substantial Shareholders
(other than the Directors)
Eastcomm 538,724,137 4,009,012 0.74
Melissa Ong 5,027,690 942,692 18.75
74
DILUTION
Number of
Shares
(after Share Split)
Total
consideration
(S$)
Average effective
cost per Share
(cents)
Noteholders
(other than the Directors and
Substantial Shareholders)
Advantage Link 12,974,612 2,432,740 18.75
Cheong Hock @ Cheong Kim Hock 8,178,083 1,533,390 18.75
Guan Meng Kuan 1,463,927 274,486 18.75
Heng Kheng Long 1,696,592 318,111 18.75
Heng Kheng Ngiap 564,866 105,912 18.75
HHEO 24,452,384 4,384,822 17.93
Huang Taoyuan 973,096 182,455 18.75
Kiong James 2,827,653 530,185 18.75
Kong Sou Hui Grace 9,408,037 1,764,007 18.75
Kong Sou Yan 5,475,800 1,026,712 18.75
Lee Han John 648,731 121,637 18.75
Lee Soo Hian James 1,946,192 364,911 18.75
Linawati Alamsjah 648,731 121,637 18.75
Link Well 5,738,886 1,076,041 18.75
Liu Jun Hang 3,525,962 661,118 18.75
MIB Investments 2,737,900 513,356 18.75
Ng Siew Tin 6,162,959 1,155,555 18.75
Ng Yew Khim Dennis 1,621,827 304,092 18.75
Ngo Chong Yong Calvin 573,889 107,604 18.75
Ngo Sio Fung Edna 573,889 107,604 18.75
Ong Bin Lay 1,454,430 272,705 18.75
Ong Chu Poh 4,281,608 802,801 18.75
Ong Eng Keong 9,408,037 1,764,007 18.75
Ong Kwee Eng 16,218,265 3,040,925 18.75
Ong Lean Wan 1,621,827 304,092 18.75
Seacare Foundation 5,738,886 1,076,041 18.75
Tan Tin Yeow 1,639,606 307,426 18.75
Tan Wee Hiok Allan 547,580 102,671 18.75
Toh Thiam Seah Victor 3,243,653 608,185 18.75
Wong Liang Kwang 564,866 105,912 18.75
Xue Qinglin 324,366 60,818 18.75
New investors pursuant to the Invitation 122,000,000 30,500,000 25.00
Please refer to the section entitled Share Capital and Shareholders Shareholders of this Offer
Document for further details on our Directors, Substantial Shareholders and Noteholders. Subsequent
to the Restructuring Exercise, Eastcomm directed the issue of 163,675,863 shares to the Noteholders
pursuant to Eastcomms redemption of the Notes.
75
RESTRUCTURING EXERCISE
In anticipation of the Invitation, our Group undertook the Restructuring Exercise to rationalise and
streamline our Groups corporate structure, pursuant to which our Company became the holding
company for our operations. Our Restructuring Exercise was completed on 16 September 2013.
The details of our Restructuring Exercise are as follows:
(1) Incorporation of our Company
Our Company was incorporated in Singapore on 3 January 2012 in accordance with the
Companies Act as a private company limited by shares with an initial paid-up share capital of
S$2.00 comprising two (2) Shares held by Eastcomm.
(2) Acquisition of the entire issued and paid-up share capital of Norwest Chemicals
Our Company entered into the Restructuring Agreement dated 19 June 2013 with Eastcomm
to acquire the entire issued and paid-up share capital of Norwest Chemicals for an aggregate
purchase consideration of S$33,544,782, based on the unaudited net asset value of Norwest
Chemicals as at 30 April 2013.
Pursuant to the Restructuring Agreement, the purchase consideration shall be satised by the
allotment and issuance of Shares (the Consideration Shares) as follows:
(i) 16,000,000 Consideration Shares to be allotted and issued to Eastcomm; and
(ii) the balance of the Consideration Shares (after the Share Split as further described in
paragraph 3 below) to be allotted and issued as follows:
(a) 474,724,129 Consideration Shares to Eastcomm; and
(b) 163,675,863 Consideration Shares to the Noteholders (as further described in
paragraph 4 below).
(3) Sub-Division of Shares
On 6 September 2013, the 16,000,002 Shares in our Company were sub-divided into 64,000,008
Shares (the Share Split).
(4) Redemption of Notes in Eastcomm held by Noteholders
On 16 September 2013, Eastcomm redeemed the Notes issued by Eastcomm to the Noteholders.
In lieu of payment of cash, Eastcomm directed our Company to allot and issue 163,675,863
Consideration Shares to the Noteholders. These Consideration Shares were issued by our
Company as part of the consideration for our Companys acquisition of Norwest Chemicals from
Eastcomm.
Please refer to the section entitled Dilution of this Offer Document for details of the shares held by
Eastcomm and the Noteholders subsequent to the redemption of the Notes.
Following the completion of the Restructuring Exercise, Eastcomm will hold 538,724,137 Shares.
76
SHARE CAPITAL AND SHAREHOLDERS
We were incorporated in Singapore on 3 January 2012 under the Companies Act as a private limited
company under the name of AsiaPhos Private Limited. As at the Latest Practicable Date, the entire
issued and paid-up share capital of our Company was S$16,000,002 comprising 16,000,002 ordinary
shares.
At the Extraordinary General Meetings held on 22 August 2013 and 6 September 2013, our Shareholders
approved, inter alia, the following:
(i) the conversion of our Company into a public limited company and the change of our name to
AsiaPhos Limited;
(ii) the Share Split;
(iii) the adoption of a new set of Articles of Association;
(iv) the allotment and issue of the New Shares pursuant to the Invitation. The New Shares, when
allotted, issued and fully paid-up, will rank pari passu in all respects with our existing issued and
fully paid-up Shares;
(v) the adoption of the AsiaPhos Performance Share Plan, and the authorisation of our Directors,
pursuant to Section 161 of the Companies Act, to allot and issue Shares upon the release of
Awards under the AsiaPhos Performance Share Plan;
(vi) the dealing and quotation of all our Shares (including the Vendor Shares and the New Shares to be
allotted and issued) on the Catalist; and
(vii) authority be given to our Directors to:
(a) (1) issue Shares whether by way of rights, bonus or otherwise; and/ or
(2) make or grant offers, agreements or options (collectively, Instruments) that might or
would require Shares to be issued, including but not limited to the creation and issue
of (as well as adjustments to) warrants, debentures or other instruments convertible
into Shares,
at any time and upon such terms and conditions and for such purposes and to such persons
as our Directors may in their absolute discretion deem t; and
(b) (notwithstanding the authority conferred may have ceased to be in force) issue Shares in
pursuance of any Instrument made or granted by our Directors while such authority was in
force,
provided that:
(1) the aggregate number of Shares issued pursuant to such authority (including new Shares
to be issued in pursuance to Instruments made or granted pursuant to such authority) shall
not exceed one hundred per cent. (100%) of the total number of issued Shares excluding
treasury shares (as calculated in accordance with sub-paragraph (2) below), of which the
aggregate number of Shares to be issued other than on a pro rata basis to Shareholders
may not exceed 50 per cent. (50%) of the total number of issued Shares excluding treasury
shares (as calculated in accordance with sub-paragraph (2) below);
(2) (subject to such manner of calculation as may be prescribed by the SGX-ST) for the purpose
of determining the aggregate number of Shares that may be issued under sub-paragraph (1)
above, the percentage of issued Shares shall be based on the total number of issued Shares
excluding treasury shares immediately following the close of the Invitation, after adjusting for:
77
(a) new Shares arising from the conversion or exercise of any convertible securities or
share options or vesting of share awards which are outstanding or subsisting at the
time such authority is given; and
(b) any subsequent bonus issue, consolidation or subdivision of Shares;
(3) in exercising the authority conferred, our Company shall comply with the provisions of the
Catalist Rules for the time being in force (unless such compliance has been waived by the
SGX-ST) and the Articles; and
(4) (unless revoked or varied by our Company in general meeting) such authority shall continue
in force until the conclusion of the next Annual General Meeting of our Company or the date
by which the next Annual General Meeting of our Company is required by law to be held,
whichever is the earlier.
As at the date of this Offer Document, our Company has only one (1) class of Shares, being ordinary
shares. The rights and privileges of our Shares are stated in the Articles of Association of our Company.
There are no founder, management or deferred Shares.
Save as disclosed to in the sections entitled Restructuring Exercise and General Information on our
Group Legal Opinion from King & Wood Mallesons Co-operation Arrangement with Dashan of this
Offer Document, no person has been, or has the right to be, given an option to subscribe for or purchase
any securities of our Company or our subsidiaries, and no option to subscribe for and/or purchase Shares
in our Company has been granted to, or was exercised by, any of our Directors or Key Executives.
Details of the changes in the entire issued and paid-up share capital of our Company since the date of
incorporation and immediately after the Invitation are set out below:
Number of Issued
Shares (S$)
Issued and fully-paid Shares as at incorporation 2 2
Initial issue of Shares pursuant to Restructuring Exercise 16,000,000 16,000,000
Total issued Shares before Share Split 16,000,002 16,000,002
Total issued Shares after Share Split 64,000,008 16,000,002
Final issue of Shares pursuant to Restructuring Exercise 638,399,992 17,544,782
Pre-Invitation share capital 702,400,000 33,544,784
New Shares to be issued pursuant to the Invitation
(1)
97,600,000 24,400,000
Post-Invitation share capital 800,000,000 57,944,784
Note:
(1) This has not taken into account a portion of the listing expenses incurred by our Company in connection with the Invitation
which will be deducted against share capital, in accordance with the Singapore Financial Reporting Standards.
Our Company
The following table sets out the changes in the issued and paid-up share capital of our Company for the
period of three (3) years preceding the Latest Practicable Date.
Date of Issue Purpose
Issue price per
Share (S$)
Number of Shares
issued
Resultant issued
share capital (S$)
3 January 2012 Issue of Shares upon
incorporation
1 2 2
12 August 2013 Initial issue of Shares pursuant
to Restructuring Exercise
1 16,000,000 16,000,002
16 September 2013 Share Split
(1)
16,000,002
16 September 2013 Final issue of Shares pursuant
to Restructuring Exercise
0.03 638,399,992 33,544,784
Note:
(1) The number of Shares in the capital of the Company after the Share Split was 64,000,008.
78
Our Subsidiaries
The following table sets out the changes in the issued and paid-up share capital and registered capital of
our subsidiaries for the period of three (3) years preceding the Latest Practicable Date.
Norwest Chemicals
Date of issue Purpose
Issue price
per Share (S$)
Number of
Shares issued
Resultant issued
share capital (S$)
8 December 2011 Capitalisation of advance
from Eastcomm
1.00 12,000,000 21,048,447
25 June 2012 Capitalisation of advance
from Eastcomm
1.00 7,000,000 28,048,447
17 September
2012
Share issuance to
Eastcomm
1.00 4,500,000 32,548,447
21 January 2013 Capitalisation of advance
from Eastcomm
1.00 646,400 33,194,847
21 January 2013 Share issuance to
Eastcomm
1.00 1,200,000 34,394,847
Mianzhu Norwest
Date of
Payment Purpose
Amount of
increase
in registered
capital
(RMB)
Resultant
registered
capital (RMB)
15 December 2011 Increase in capital contribution by way of cash 60,000,000 140,000,000
Save as disclosed above and in the sections entitled Restructuring Exercise and AsiaPhos
Performance Share Plan of this Offer Document, no shares in, or debentures of, our Company or any of
our subsidiaries have been issued, or are proposed to be issued, as fully or partly paid-up for cash or for
a consideration other than cash, for the three (3) years preceding the Latest Practicable Date.
SHAREHOLDERS
Our Shareholders and their respective equity interests in our Company immediately before the Invitation
(but after the Restructuring Exercise), and immediately after the Invitation are set out below:
Before the Invitation
(after the Restructuring Exercise)
After the Invitation
(after deducting the Vendor Shares)
Direct Interest Deemed Interest Direct Interest Deemed Interest
No. of Shares % No. of Shares % No. of Shares % No. of Shares %
Directors
Dr. Ong Hian Eng
(1)(2)(3)(6)(7)
(8)(9)(12)(14)(16)(17)
6,164,384 0.9 548,132,174 78.0 6,164,384 0.8 548,132,174 68.5
Simon Ong
(1)(2)(7)(9)(12)(13)(14)
(16)(17)
2,919,306 0.4 538,724,137 76.7 2,919,306 0.4 538,724,137 67.3
Raymond Ong
(1)(2)(3)(7)(9)(12)
(13)(14)(16)(17)
2,919,306 0.4 539,372,868 76.8 2,919,306 0.4 539,372,868 67.4
Ong Bee Pheng
(1)(3)(7)(9)(12)
(14)(16)(17)
9,408,037 1.3 9,408,037 1.2
Hong Pian Tee
Goh Yeow Tin
(18)

Francis Lee
79
Before the Invitation
(after the Restructuring Exercise)
After the Invitation
(after deducting the Vendor Shares)
Direct Interest Deemed Interest Direct Interest Deemed Interest
No. of Shares % No. of Shares % No. of Shares % No. of Shares %
Substantial Shareholders
(other than Directors)
Astute Ventures
(2)(3)
538,724,137 76.7 538,724,137 67.3
Eastcomm
(2)(3)
538,724,137 76.7 538,724,137 67.3
Melissa Ong
(1)(2)(3)(7)(9)(12)(13)
(14)(16)(17)
5,027,690 0.7 538,724,137 76.7 5,027,690 0.6 538,724,137 67.3
Other Shareholders
Advantage Link
(4)
12,974,612 1.9 12,974,612 1.6
Cheong Hock
@ Cheong Kim Hock 8,178,083 1.2 2,178,083 0.3
Guan Meng Kuan
(5)
1,463,927 0.2 1,463,927 0.2
Heng Kheng Long 1,696,592 0.2 496,592 0.1
Heng Kheng Ngiap 564,866 0.1 164,866 neg
(20)

HHEO
(6)
24,452,384 3.5 24,452,384 3.1
Huang Taoyuan 973,096 0.1 973,096 0.1
Kiong James 2,827,653 0.4 827,653 0.1
Kong Sou Hui Grace
(7)(8)
9,408,037 1.3 9,408,037 1.2
Kong Sou Yan
(7)(8)
5,475,800 0.8 5,475,800 0.7
Lee Han John 648,731 0.1 648,731 0.1
Lee Soo Hian James 1,946,192 0.3 1,946,192 0.2
Linawati Alamsjah
(9)
648,731 0.1 648,731 0.1
Link Well
(10)
5,738,886 0.8 1,738,886 0.2
Liu Jun Hang 3,525,962 0.5 3,525,962 0.4
MIB Investments
(11)
2,737,900 0.4 737,900 0.1
Ng Siew Tin
(2)(12)(17)
6,162,959 0.9 6,162,959 0.8
Ng Yew Khim Dennis
(13)
1,621,827 0.2 1,621,827 0.2
Ngo Chong Yong Calvin
(14)
573,889 0.1 173,889 neg
(20)

Ngo Sio Fung Edna
(14)
573,889 0.1 173,889 neg
(20)

Ong Bin Lay
(15)
1,454,430 0.2 1,454,430 0.2
Ong Chu Poh 4,281,608 0.6 2,281,608 0.3
Ong Eng Keong
(16)
9,408,037 1.3 9,408,037 1.2
Ong Kwee Eng
(2)(12)(17)
16,218,265 2.3 16,218,265 2.0
Ong Lean Wan 1,621,827 0.2 1,621,827 0.2
Seacare Foundation
(18)
5,738,886 0.8 1,738,886 0.2
Tan Tin Yeow 1,639,606 0.2 439,606 0.1
Tan Wee Hiok Allan 547,580 0.1 147,580 ]neg
(20)

Toh Thiam Seah
Victor
(15) (19)
3,243,653 0.5 3,243,653 0.4
Wong Liang Kwang 564,866 0.1 164,866 neg
(20)

Xue Qinglin 324,366 0.1 324,366 neg
(20)

New Public
Shareholders 122,000,000 15.3
Total: 702,400,000 100.0 800,000,000 100.0
Notes:
(1) Our CEO and Executive Director, Dr. Ong Hian Eng, and our Non-Executive Director, Ong Bee Pheng, are father and
daughter.
Our CEO and Executive Director, Dr. Ong Hian Eng, is the uncle of (i) our Executive Director, Simon Ong; (ii) our Non-
Executive Director, Raymond Ong; and (iii) our Substantial Shareholder, Melissa Ong, who are siblings.
80
Our Executive Director, Simon Ong, our Non-Executive Directors, Raymond Ong and Ong Bee Pheng, and our Substantial
Shareholder, Melissa Ong, are cousins.
(2) Ong Kwee Eng, a sibling of our CEO and Executive Director, Dr. Ong Hian Eng, transferred his shares in Eastcomm to
Astute Ventures. The directors of Astute Ventures are our Executive Director, Simon Ong, our Non-Executive Director,
Raymond Ong, and our Substantial Shareholder, Melissa Ong. The shareholders of Astute Ventures are our Executive
Director, Simon Ong, our Non-Executive Director, Raymond Ong, and our Substantial Shareholder, Melissa Ong, and their
parents, Ong Kwee Eng and Ng Siew Tin, holding 20.0%, 20.0%, 42.0%, 9.0% and 9.0% of Astute Ventures share capital,
respectively.
(3) The directors of Eastcomm are our CEO and Executive Director, Dr. Ong Hian Eng, our Non-Executive Directors, Raymond
Ong and Ong Bee Pheng, and our Substantial Shareholder, Melissa Ong. The shareholders of Eastcomm are our CEO and
Executive Director, Dr. Ong Hian Eng, our Key Executive, Chia Chin Hau, Astute Ventures, and WYY Investment (the sole
shareholder of WYY Investment is our Key Executive, Wang Xuebo), holding 45.5%, 0.7%, 45.5% and 8.4% of Eastcomms
share capital, respectively.
Dr. Ong Hian Eng and Astute Ventures are each deemed interested in the Shares held by Eastcomm.
(4) Advantage Link is a company incorporated in the British Virgin Islands. All of the shares in the issued and paid-up share
capital of Advantage Link are held by Espira Holdings Ltd, a company incorporated in the Independent State of Samoa. All of
the shares in the issued and paid-up capital of Espira Holdings Ltd are held by Fidelitycorp Limited as trustee of the Espira
Trust. Espira Trust is a discretionary trust of which (i) the current beneciary is Lim Chee Kian; and (ii) the settlor is Lim Chee
Kian. Lim Chee Kian is deemed interested in the Shares held by Advantage Link.
(5) Guan Meng Kuan is a director of Hwa Hong, HHEO, Hwa Hong Capital (Pte) Limited and Hwa Hong Investments Pte Ltd,
and the former Legal Representative of Mianzhu Norwest.
(6) HHEO is a wholly-owned subsidiary of SGX-ST listed Hwa Hong, which is an Associate of our CEO and Executive Director,
Dr. Ong Hian Eng.
(7) Kong Sou Hui Grace is the spouse of our CEO and Executive Director, Dr. Ong Hian Eng. Dr. Ong Hian Eng is deemed
interested in the Shares held by Kong Sou Hui Grace. Kong Sou Hui Grace is also an immediate family member of our Non-
Executive Director, Ong Bee Pheng, and an extended family member of our Executive Director, Simon Ong, Non-Executive
Director, Raymond Ong, and our Substantial Shareholder, Melissa Ong. Kong Sou Hui is an immediate family member of
Kong Sou Yan - please refer to Note (8).
(8) Kong Sou Yan is an extended family member of our CEO and Executive Director, Dr. Ong Hian Eng, and an immediate family
member of Kong Sou Hui Grace - please refer to Note (7).
(9) Linawati Alamsjah is the spouse of our Non-Executive Director, Raymond Ong. Raymond Ong is deemed interested in the
Shares held by Linawati Alamsjah. Linawati Alamsjah is also an extended family member of our Executive Director, Simon
Ong, our CEO and Executive Director, Dr. Ong Hian Eng, our Non-Executive Director, Ong Bee Pheng, and our Substantial
Shareholder, Melissa Ong.
(10) Link Well is a company incorporated in Hong Kong Special Administrative Region of the PRC. The sole director of Link Well is
Chan Kern Miang. Its shareholders are Ang Mui Yee and Chan Kern Miang.
(11) MIB Investments is a company incorporated in Singapore. The sole director of MIB Investments is Kho Chung Wah James. Its
shareholders are Soh Poh Gin, Chen Dan and Ngo Swee Liang.
(12) Ng Siew Tin is an immediate family member of our Executive Director, Simon Ong, our Non-Executive Director, Raymond
Ong, and our Substantial Shareholder, Melissa Ong. Ng Siew Tin is also an extended family member of our CEO and
Executive Director, Dr. Ong Hian Eng, and our Non-Executive Director, Ong Bee Pheng. Ng Siew Tin is also the spouse of
Ong Kwee Eng please refer to Note (17).
(13) Ng Yew Khim Dennis is an extended family member of our Executive Director, Simon Ong, and our Non-Executive Director,
Raymond Ong, and our Substantial Shareholder, Melissa Ong.
(14) Ngo Chong Yong Calvin and Ngo Sio Fung Edna are extended family members of our CEO and Executive Director, Dr. Ong
Hian Eng, our Executive Director, Simon Ong, our Non-Executive Directors, Raymond Ong and Ong Bee Pheng, and our
Substantial Shareholder, Melissa Ong.

(15) Ong Bin Lay is the spouse of Toh Thiam Seah Victor - please refer to Note (19).
(16) Ong Eng Keong is an immediate family member of our CEO and Executive Director, Dr. Ong Hian Eng and our Non-Executive
Director, Ong Bee Pheng, and an extended family member of our Executive Director, Simon Ong, Non-Executive Director
Raymond Ong, and our Substantial Shareholder, Melissa Ong.
(17) Ong Kwee Eng is an immediate family member of our CEO and Executive Director, Dr. Ong Hian Eng, our Executive Director,
Simon Ong, our Non-Executive Director, Raymond Ong, and our Substantial Shareholder, Melissa Ong. Ong Kwee Eng is
also an extended family member of our Non-Executive Director, Ong Bee Pheng. Ong Kwee Eng is also the spouse of Ng
Siew Tin please refer to Note (12).
81
(18) Seacare Foundation is a company incorporated in Singapore. Its directors are Lee Van Chong, Leow Ching Chuan,
Nazarudin Bin Nandok, Kam Soon Huat, Lee Chee Fong, and Tan Keng Hui Daniel. Its sole shareholder is Seacare Co-
operative Ltd. The directors of Seacare Co-operative Ltd are Leow Ching Chuan, Lee Van Chong, Sim Hor Pheng, Kam
Soon Huat, Mohamed Idris Bin Mohamed Ibrahim, Lee Chee Fong, Toh Hwee Tin, Raja Mohd Said Bin Mohd Shak and our
Independent Director, Goh Yeow Tin.
(19) Toh Thiam Seah Victor is the (Supervisor) of Mianzhu Norwest. Please refer to the section entitled Management
and Corporate Governance Legal Representative and Supervisor of our PRC Subsidiary, Mianzhu Norwest of this Offer
Document for further details on the role of the Supervisor.
(20) neg refers to negligible.
The Shares held by our Directors, Key Executives and Substantial Shareholders do not carry different
voting rights from the New Shares which are the subject of the Invitation.
Save as disclosed above, our Company is not directly or indirectly owned or controlled by another
corporation, any government or other natural or legal person whether severally or jointly. There is no
known arrangement, the operation of which may, at a subsequent date, result in a change in control of
our Company.
Save as disclosed in the section entitled Restructuring Exercise of this Offer Document, there has been
no signicant change in the percentage of ownership of the issued and paid-up share capital of our
Company between the date of its incorporation and the Latest Practicable Date.
VENDORS
The names of the Vendors and the number of Vendor Shares which they will offer pursuant to the
Invitation are set out below:
Name
Shares held
immediately before
the Invitation
Vendor Shares offered
pursuant to the Invitation
Shares held
immediately after
the Invitation
Number of
Shares
% of pre-
Invitation
share
capital
Number of
Shares
% of pre-
Invitation
share
capital
% of post-
Invitation
share
capital
Number of
Shares
% of post-
Invitation
share
capital
Cheong Hock
@ Cheong Kim Hock
8,178,083 1.2 6,000,000 0.9 0.8 2,178,083 0.3
Heng Kheng Long 1,696,592 0.2 1,200,000 0.2 0.2 496,592 0.1
Heng Kheng Ngiap 564,866 0.1 400,000 0.1 0.1 164,866 neg
(1)
Kiong James 2,827,653 0.4 2,000,000 0.3 0.3 827,653 0.1
Link Well 5,738,886 0.8 4,000,000 0.6 0.5 1,738,886 0.2
MIB Investments 2,737,900 0.4 2,000,000 0.3 0.3 737,900 0.1
Ngo Chong Yong Calvin 573,889 0.1 400,000 0.1 0.1 173,889 neg
(1)
Ngo Sio Fung Edna 573,889 0.1 400,000 0.1 0.1 173,889 neg
(1)
Ong Chu Poh 4,281,608 0.6 2,000,000 0.3 0.3 2,281,608 0.3
Seacare Foundation 5,738,886 0.8 4,000,000 0.6 0.5 1,738,886 0.2
Tan Tin Yeow 1,639,606 0.2 1,200,000 0.2 0.2 439,606 0.1
Tan Wee Hiok Allan 547,580 0.1 400,000 0.1 0.1 147,580 neg
(1)
Wong Liang Kwang 564,866 0.1 400,000 0.1 0.1 164,866 neg
(1)
Note:
(1) neg refers to negligible.
The address of each of the Vendors can be found in the section entitled Corporate Information of this
Offer Document.
82
Save as disclosed in this Offer Document, none of our Directors or Substantial Shareholders has an
interest in the Vendor Shares.
Save as disclosed in this Offer Document, none of the Vendors have any position, ofce or other material
relationship with our Group within the period of three (3) years before the date of lodgment of this Offer
Document.
MORATORIUM
Controlling Shareholders and their Associates
Under Rule 443 of the Catalist Rules, (i) our Controlling Shareholders, namely, Dr. Ong Hian Eng, Simon
Ong, Raymond Ong, Melissa Ong, Eastcomm and Astute Ventures; and (ii) their Associates; and (iii)
Executive Directors with interest of more than ve per cent. (5%) as at our Companys date of admission
to Catalist will be deemed promoters of the Company.
To demonstrate their commitment to the Company and its subsidiaries, each of (i) our Controlling
Shareholders, as well as (ii) our Non-Executive Director, Ong Bee Pheng; (iii) Kong Sou Hui Grace; (iv)
Linawati Alamsjah; (v) Ong Eng Keong; (vi) Ong Kwee Eng; (vii) Ng Siew Tin; and (viii) Kong Sou Yan
(collectively, the Related Shareholders) have each undertaken to the Sponsor and our Company, inter
alia, that, from the date of the issue of the Shares until the date falling 12 months after our Companys
date of admission to Catalist (the Initial Period), they will not, without the prior written consent of the
Sponsor, perform any of the following activities:
(i) offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or
contract to sell, grant any option, right or warrant to purchase, lend, hypothecate or encumber or
otherwise transfer, assign, dispose or realise, directly or indirectly, any Shares or any securities
convertible into or exercisable or exchangeable for or which carry rights to subscribe or purchase
any Shares; or
(ii) enter into any swap, hedge or other arrangement that transfers to another, in whole or in part,
any of the economic consequences of ownership of Shares or any securities convertible into or
exercisable or exchangeable for or which carry rights or subscribe or purchase any Shares; or
(iii) deposit any Shares or any securities convertible into or exchangeable for or which carry rights to
subscribe or purchase any Shares in any depository receipt facilities (other than CDP); or
(iv) enter into a transaction which is designed or which may reasonably be expected to result in any of
the above; or
(v) publicly announce any intention to do any of the above.
(collectively, the Restricted Activities).
The restriction shall apply to all Shares held directly by the Related Shareholders immediately after the
Invitation, being 612,484,689 Shares (representing 76.6% of our Companys post-Invitation share capital.
For the six (6) month period after the Initial Period, the restriction shall apply to fty per cent. (50%) of the
Shares held directly by the Related Shareholders immediately after the Invitation.
We were informed by Hwa Hong and HHEO on 26 August 2013 as follows:
(i) Hwa Hong and HHEO applied to the SGX-ST for a waiver from the moratorium requirement for
promoters under the Catalist Rules on the grounds that:
(a) neither Hwa Hong nor HHEO is a promoter in its own right (i.e. neither Hwa Hong nor HHEO
has or will have a controlling interest in our Company, both before and immediately after the
Invitation);
83
(b) the interests of Dr. Ong Hian Eng and all of his siblings (Dr. Ongs Siblings) in Shares that
will be held by HHEO, are held through their shareholding interests in Hwa Hong, a company
listed on the SGX-ST;
(c) immediately after the Invitation, HHEO will hold less than ve per cent. (5%) of the equity
interest in our Company;
(d) Dr. Ong Hian Engs controlling interest in our Company (held partly directly, and partly
through Eastcomm) will be subject to moratorium; and
(e) none of Dr Ongs Siblings is involved in the management of our Company.
(ii) The SGX-ST has waived (the SGX-ST Waiver) the moratorium requirements for promoters under
the Catalist Rules applicable to Hwa Hong, HHEO and/or Dr. Ongs Siblings (in connection with
their interests in the Shares that will be held by HHEO, Hwa Hongs wholly-owned subsidiary).
(iii) The SGX-ST Waiver notwithstanding, HHEO has undertaken to the Sponsor, that it will not, without
the prior written consent of the Sponsor, perform any of the Restricted Activities from the date
of issue of the Shares to HHEO, until the date falling six (6) months after our Companys date of
admission to Catalist for 24,452,384 Shares (representing 3.1% of our Companys post-Invitation
share capital).
In addition, each of the shareholders of Astute Ventures, Eastcomm, and WYY Investment have given a
similar undertaking to the Sponsor and our Company not to reduce any part of their respective interest
in Eastcomm, Astute Ventures and WYY Investment from the date of the said undertaking until the date
falling six (6) months after the Initial Period. Each of the shareholders of Link Well and MIB Investments
have also given a similar undertaking to the Sponsor and the Company not to reduce any part of their
respective interests in Link Well and MIB Investments from the date of the said undertaking until the date
falling 12 months after our Companys date of admission to Catalist.
Further, (i) Ngo Sio Fung Edna; (ii) Ngo Chong Yong Calvin; (iii) Ng Yew Khim Dennis; (iv) Toh Thiam
Seah Victor; (v) Ong Bin Lay; (vi) Link Well; (vii) Ong Chu Poh; (viii) Seacare Foundation; (ix) Heng Kheng
Long; (x) Kiong James; (xi) Heng Kheng Ngiap; (xii) Wong Liang Kwang; (xiii) Cheong Hock @ Cheong
Kim Hock; (xiv) Tan Wee Hiok Allan; (xv) MIB Investments; (xvi) Tan Tin Yeow; (xvii) Advantage Link; (xviii)
Guan Meng Kuan; (xix) Huang Taoyuan; (xx) Lee Soo Hian James; (xxi) Liu Jun Hang; (xxii) Ong Lean
Wan; (xxiii) Xue Qinglin; and (xxiv) Lee Han John, will each undertake to the Sponsor and our Company,
that they will not, without the prior written consent of the Sponsor, perform any of the Restricted Activities
from the date of issuance of the Shares until the date falling six (6) months after our Companys date
of admission to Catalist on the aggregate of 35,262,927 Shares (representing 4.4% of our Companys
post-Invitation share capital) and for the six (6) month period thereafter, on the aggregate of 25,862,927
Shares (representing 3.2% of our Companys post-Invitation share capital).
84
OUR GROUP STRUCTURE
Our Group structure immediately after the Restructuring Exercise is as follows:
The Company
Norwest Chemicals
Mianzhu Norwest
100%
100%
Details of our subsidiaries are as follows:
Name of
subsidiary
Date and
place of
incorporation
Tenure of
operation
Principal business/
Principal place of business
% ownership /
% voting power
held by our
Company / Group
Norwest
Chemicals
(1)
18 September
1996 /
Singapore
Not applicable Investing in chemical projects,
general wholesale trade and trading
of chemicals /
Singapore
100%
Mianzhu
Norwest
(2)
24 December
1996 /
PRC
24 December
1996 to 23
December
2046
Exploration, mining and sale of
phosphate rocks, production and
sale of phosphorus and phosphate-
based chemical products /
the PRC
100%
Notes:
(1) The board of directors of Norwest Chemicals comprises our CEO and Executive Director, Dr. Ong Hian Eng, our Non-
Executive Director, Raymond Ong, our Executive Director, Simon Ong (as alternate director to Raymond Ong) and Chng
Hwee Hong (as non-executive director).
(2) The board of directors of Mianzhu Norwest comprises our CEO and Executive Director, Dr. Ong Hian Eng, our Executive
Director, Simon Ong, and our Key Executive, Wang Xuebo. The Legal Representative of Mianzhu Norwest is our CEO and
Executive Director, Dr. Ong Hian Eng. Toh Thiam Seah Victor is the (Supervisor) of Mianzhu Norwest.
Save as disclosed above, our Group does not have any other subsidiaries or associated companies.
None of our subsidiaries is listed on any stock exchange.
85
GENERAL INFORMATION ON OUR GROUP
HISTORY
Our Company was incorporated in Singapore under the Singapore Companies Act on 3 January 2012
with the name AsiaPhos Private Limited, as a private company limited by shares. In preparation for our
listing, we undertook the Restructuring Exercise whereby our Company acquired one hundred per cent.
(100%) shareholding interest in Norwest Chemicals and became the holding company of our Group. We
also changed the name of our Company to AsiaPhos Limited upon our conversion to a public company
limited by shares. Please refer to the section entitled Restructuring Exercise of this Offer Document for
further details.
Our Groups business commenced with the incorporation of Norwest Chemicals in Singapore in 1996.
Norwest Chemicals was incorporated as a wholly-owned subsidiary of Norwest Holdings. Norwest
Holdings was an associated company of the Hwa Hong Group, and our CEO and Executive Director,
Dr. Ong Hian Eng, was one of the key executives assigned by the Hwa Hong Group to oversee the
management of Norwest Chemicals.
In the same year, Mianzhu Norwest was incorporated as a sino-foreign joint venture with Norwest
Chemicals holding a sixty per cent. (60%) equity interest in Mianzhu Norwest with the balance held by
our then-PRC business partner.
Mianzhu Norwest thereafter commenced its Chemical Production Operations, producing P
4
, thermal
phosphoric acid and SHMP, at the Previous Hanwang Facilities. As Mianzhu Norwest did not own mining
rights for any mines at that time, phosphate rocks were obtained from third parties for its Chemical
Production Operations.
In 1999, we expanded our range of phosphate-based chemical products by commencing production of
granular heavy-density STPP, which fetches a higher price compared to powder low-density STPP. We
believe that we were one of the rst few manufacturers in the PRC to produce granular heavy-density
STPP commercially. In 1996 and 2001, Mianzhu Norwest attained ISO 9001 and ISO 14001 certications
respectively.
In 2002, we expanded our business and operations and entered into a mine transfer agreement to
acquire the mining rights for our Mines from (Sichuan Mianzhu Xiaoban
Enterprise Group Co., Ltd). We also obtained the relevant regulatory approvals to operate our Mines.
Please refer to the section entitled General Information on our Group - Mining Operations of this Offer
Document for further details on our Mines. Thereafter, we focused on mining phosphate rocks at Mine 1,
while Mine 2 was temporarily left dormant. Using phosphate rocks from Mine 1, we were able to vertically
integrate our operations by rening and processing these phosphate rocks to produce our range of

In 2003, Mianzhu Norwest became a wholly foreign-owned enterprise after we acquired the remaining
forty per cent. (40%) shareholding in Mianzhu Norwest from our then-PRC business partner.
Between 2003 and 2007, with a view to capturing the growth potential in the PRC and other parts of
the world, we began to emphasise marketing our products to large PRC companies and multi-national
companies, and we secured new major customers for our phosphate-based chemical products,
including major multi-national corporations. In order to expand our potential customer base, we also
obtained various certications including (i) certication from NSF International in 2005 for compliance
with NSF/ANSI 60: Drinking Water Treatment Chemicals; and (ii) Kosher certication from KOF-K Kosher
Supervision, in respect of our thermal phosphoric acid, SHMP and STPP, in 2006.
In 2004, we commenced mining preparatory work on Mine 2. Upon completion of our mining preparatory
work for Mine 2 in 2008, we commenced mining phosphate rocks at Mine 2.
In 2008, we also received the exploration rights issued by the Sichuan Land Department for additional
mining depths and areas in the vicinities of each of Mine 1 and Mine 2.
86
The Wenchuan Earthquake
On 12 May 2008, our Mining Operations and Chemical Production Operations were disrupted by the
Wenchuan Earthquake. As a result of the Wenchuan Earthquake (i) our Groups Mining Operations were
suspended as access roads to our Mines were blocked; (ii) there were fatalities and casualties among
our mining personnel; and (iii) our Group substantially ceased its Chemical Production Operations at the
Previous Hanwang Facilities as a portion of the key facilities was irreparably damaged.
The Recovery Process
Our recovery efforts focused on the restoration of access roads to our Mines and the rebuilding of our
facilities. In addition, we compensated all our affected workers in accordance with applicable PRC laws,
rules and regulations.
Our redevelopment prospects improved when in July 2009, the Sichuan Development Commission and
the Hong Kong SAR Mainland Affairs Bureau announced plans to jointly build the Mian Mao Highway.
The Mian Mao Highway is expected to increase accessibility between our Mines and the New Gongxing
Site once completed as we will be able to use the Mian Mao Highway to access the mountain roads
leading to our Mines. Construction of the Mian Mao Highway is expected to be completed around
2015/ 2016. This will allow us to plan for an increase of our phosphate rock output due to anticipated
shortened travelling time, without having to incur costs associated with the construction of the required
infrastructure.
Between 2009 and 2011, as part of the measures to assist mining companies in Mianzhu City, Sichuan
Province, the PRC, which were affected by the Wenchuan Earthquake, the relevant PRC authorities
issued to Mianzhu Norwest certain exemptions and deferments in respect of the renewal of safety
production permits required for our Mining Operations.

The local PRC authorities also assisted us in our recovery by providing a government investment subsidy
of RMB10.91 million for our post-Wenchuan Earthquake reconstruction projects. This subsidy was
granted to us pursuant to the 50,000 /
(Approval regarding Sichuan Mianzhu Norwest
Phosphate Chemical Co., Ltd. 50,000 tonnes/year phosphate post-disaster rebuilding programme
pursuant to the central post-disaster reconstruction fund investment subsidy plan issued by the Mianzhu
Development and Reform Bureau), a post-disaster reconstruction initiative by the local authorities in
February 2010. Other efforts undertaken by the PRC government include improving infrastructure of
our immediate operating vicinity by constructing roads and building electricity transmission lines and
substations in the vicinity of our Mines.
In recognition of our strong working relationship and as a show of support for our relief efforts, one of our
major customers donated RMB1 million to Mianzhu Norwest in 2008. Further, a substantial portion of our
sole outstanding bank loan was also waived in 2009 as part of the relief efforts extended to companies
affected by the Wenchuan Earthquake.
As the local PRC authorities decided to re-develop the land on which the Previous Hanwang Facilities
were located, such PRC authorities entered into an agreement with Mianzhu Norwest in 2011 to acquire
certain immovable assets and land use rights for the Previous Hanwang Facilities.
At the end of 2011, we successfully obtained the land use rights for the New Gongxing Site, Phase 1
Land.
In 2012 and 2013, the Mianzhu Safety Bureau issued the Trial Mining Notications to Mianzhu Norwest,
permitting Mianzhu Norwest to carry out Trial Mining Operations at the Mines. In 2012, we completed
construction of our P
4
Plant at the New Gongxing Site under Phase 1 of the Rebuilding Programme. We
completed the temporary relocation of our STPP equipment, machinery and storage facilities from the
Previous Hanwang Facilities to the New Gongxing Site in 2012.
87
In 2013, the Mianzhu Safety Bureau issued the Commercial Mining Notication to Mianzhu Norwest,
which permitted Mianzhu Norwest to carry out Commercial Mining Operations at Mine 1. As we have
obtained the requisite approvals, licences, permits and authorisations, we are currently conducting Trial
Chemical Production Operations for Phase 1 of the Rebuilding Programme at the New Gongxing Site.
Previous Corporate Exercises involving Norwest Chemicals
In 2004, Norwest Holdings entered into a conditional agreement with a company listed on the Australian
Securities Exchange (the Buyer) and an individual, who was a director of both Norwest Holdings
and the Buyer, for the disposal of one hundred per cent. (100%) of the equity interest in Norwest
Chemicals to the Buyer (the Proposed Transaction). The completion of the Proposed Transaction was
conditional upon the satisfaction or waiver of certain conditions precedent. However, the agreement was
subsequently terminated as not all the conditions precedent were satised or waived.
In 2006, a fund-raising exercise was proposed to support the operations of Norwest Holdings (the then-
holding company of Norwest Chemicals) and its subsidiaries (including Mianzhu Norwest). However,
pursuant to a shareholders disagreement, and as there were then no other viable alternatives for fund-
raising, one of Norwest Holdings shareholders and its main creditor, HHEO (a subsidiary of the Hwa
Hong Group), applied for Norwest Holdings to be liquidated. Norwest Holdings was compulsorily wound
up on grounds of insolvency in 2008.
In May 2008, the liquidator of Norwest Holdings accepted an offer by Newport Mining (now known as
Aguia Resources Limited), a company listed on the Australian Securities Exchange. However the
acquisition by Newport Mining was not completed due to, inter alia, the Wenchuan Earthquake. In August
2008, HHEO acquired Norwest Chemicals via an auction held by the liquidator of Norwest Holdings. On
the same day, HHEO sold Norwest Chemicals to Eastcomm (which was then wholly-owned by our CEO
and Executive Director, Dr. Ong Hian Eng).
BUSINESS OVERVIEW
chemical products.
We are currently headquartered in Singapore, and possess the rights to explore and mine phosphate in
Sichuan Province, PRC. Prior to the Wenchuan Earthquake, we were engaged in a vertically-integrated
production process involving (i) our Mining Operations; and (ii) our Chemical Production Operations.
We currently own mining and exploration rights to our Mines, which are located approximately 40 km
northwest of the New Gongxing Site. Currently, we have two (2) Mines which are producing phosphate
rocks. Between 2002 and the Wenchuan Earthquake, we obtained approximately 379,000 tonnes of
phosphate rock from Mine 1. For FY2005, FY2006 and FY2007, we obtained approximately 62,000,
71,000 and 89,400 tonnes of phosphate rocks respectively from our Mines.
We have completed the construction of our P
4
Plant at the New Gongxing Site under Phase 1 of the
Rebuilding Programme in preparation for the resumption of our Chemical Production Operations. We are
currently in the preliminary stages of Phase 2 of the Rebuilding Programme, which involves construction
of, inter alia, (i) a thermal phosphoric acid plant; and (ii) a food grade and non food grade SHMP plant. As
part of Phase 2 of the Rebuilding Programme, we have also temporarily relocated our STPP equipment,
machinery and storage facilities from the Previous Hanwang Facilities to the New Gongxing Site.
We sell the phosphate rocks obtained from our Mines to third parties and we may retain a portion of the
phosphate rocks for our Chemical Production Operations. We sell phosphate rocks only to our customers
in the PRC, and phosphate-based chemical products to our customers in the PRC and overseas.
Please refer to the WGM Technical Report set out in Appendix J to this Offer Document for a map
showing the approximate geographical location of our Mines and our processing facilities.
88
USES OF PHOSPHATES
Phosphate is a valuable and non-renewable natural resource, and has numerous commercial and
industrial applications. The root element, phosphorus, is an important nutrient for human, animal and
plant life.
Phosphorus, phosphates and phosphate-based chemical products are used in, or in the manufacturing
processes for, many everyday products, including:
batteries;
ceramics;
detergents and cleaning products (including in the dairy, beverage, meat and other food-processing
industries, and for laundry, janitorial, and sanitising products);
fertilisers and animal feed;
explosives;
re retardants;
food and beverage products, e.g. milk, cheese, frozen and canned vegetables, soft drinks, poultry
products and sh llets;
liquid crystal display (LCD) panels;
lubricants for industrial applications;
metal treatment products;
oral hygiene products, e.g. mouthwash and toothpaste;
paint;
paper;
pharmaceutical products and dietary supplements;
plasma screens;
semi-conductors; and
water treatment products.
As at the Latest Practicable Date, we sell phosphate rocks only to our customers in the PRC, and
phosphate-based chemical products to our customers in the PRC and overseas.
To the best of our Directors knowledge, for the Period Under Review, our Group sold (i) phosphate rocks,
to customers primarily engaged in manufacturing fertilisers and animal feed; and (ii) phosphate-based
chemical products, to customers primarily engaged in manufacturing water treatment products and oral
hygiene products.
Please refer to the section entitled General Information on our Group Major Customers of this Offer
Document for further details on our major customers.
MINING OPERATIONS
Under PRC laws and regulations, mining companies must obtain, inter alia, mining rights for the mines
prior to the commencement of mining operations. Mining companies must also obtain exploration rights
prior to obtaining a mining right in order to conduct exploration activities to determine if a potential mining
area is commercially feasible for mining.
Prior to the commencement of commercial mining operations, mining companies are also required to
obtain various approvals, licences, authorisations and permits in accordance with PRC laws, rules and
regulations, including the Mining Safety Production Permit and the Pollution Discharge Permit. The
Mining Safety Production Permit can be obtained for a mining site only after the mining right is granted.
Please refer to the sections entitled General Information on our Group Legal Opinion from King &
Wood Mallesons and General Information on our Group PRC Government Regulations of this Offer
89
As at the Latest Practicable Date, the details of our Mines are as follows:
Mine 1 Mine 2
Commencement date of mining activities 2002
(temporary stoppage from
May 2008 November 2010)
2008
(temporary stoppage from
May 2008 May 2012)
Current licence period
(1)
March 2011 December 2015 March 2011 January 2020
Permit area
(1)(2)
1.6491 km
2
as follows:
- 1.53 km wide E-W
- 1.10 km long N-S
- 2240 m 2570 m elevation
2.0237 km
2
as follows:
- 0.76 km wide E-W
- 2.74 km long N-S
- 1600 m 2420 m elevation
Approved production scale
(1)(3)
50,000 tonnes per year 200,000 tonnes per year
Average bed thickness
(2)(4)
(approximate) 5.3 m 7.0 m
Average P
2
O
5
content level
(2)(4)
(approximate) 28.6% 29.6%
Measured phosphorite resources
(2)
3.0 million tonnes 6.9 million tonnes
Indicated phosphorite resources
(2)
10.7 million tonnes
Inferred phosphorite resources
(2)
0.9 million tonnes 1.8 million tonnes
Adits 1 3
Notes:
(1) Based on our mining licences in relation to the Mines.
(2) Based on the WGM Technical Report.
(3) The approved production scales for Mine 1 and Mine 2 were increased in December 2005 and January 2010 respectively.
(4) Average of measured and indicated resources.
In 2008, we also received the exploration rights issued by the Sichuan Land Department for additional
mining depths and areas in the vicinities of each of Mine 1 and Mine 2.
As at the Latest Practicable Date, the details of our exploration rights are as follows:
Vicinity of Mine 1 Vicinity of Mine 2
Commencement date of exploration activities for
permitted licensed areas in the vicinity of Mine 1
and Mine 2 (as the case may be)
2010 2011
Current licence period April 2012 April 2014 June 2012 June 2014
Permit area 0.55 km
2
1.28 km
2
Average bed thickness
(1)
(approximate) 2.9 m 6.1 m
Average P
2
O
5
content level
(1)
(approximate) 29.4% 26.6%
Measured phosphorite resources 0.3 million tonnes 0.03 million tonnes
Indicated phosphorite resources 1.3 million tonnes
Inferred phosphorite resources 16.1 million tonnes
Adits 3
Note:
(1) Average of measured and indicated resources.
90
The above information regarding our Mines should be read in conjunction with the full text of this Offer
Document, including the WGM Technical Report set out in Appendix J to this Offer Document.
Upon completion of the Mian Mao Highway, we expect to benet from shorter travelling time and lower
transportation costs between our Mines and the New Gongxing Facilities. We will also tap on other
ancillary transportation networks such as roadways and railways, thereby allowing us to minimise time
taken and costs incurred in the delivery of our phosphate rocks to our customers.
Phosphorite resources
The following table, which is based on the estimates provided in the WGM Technical Report set out in
Appendix J to this Offer Document, provides details of the estimated phosphorite resources available
for Mine 1 and Mine 2 as at 31 December 2012. The phosphorite resources for our mining rights and
exploration rights have been combined:
Gross Attributable to
licence
Net Attributable to the
Company
Tonnes
(millions)
Grade
(P
2
O
5
%)
Tonnes
(millions)
Grade
(P
2
O
5
%)
Mine 1:
Resources
Measured 3.3 28.67 3.3 28.67
Indicated
Total 3.3
(1)
28.67
(1)
3.3
(1)
28.67
(1)
Inferred 0.9 26.77 0.9 26.77
Mine 2:
Resources
Measured 6.9 29.21 6.9 29.21
Indicated 12.0 29.43 12.0 29.43
Total 18.9
(1)
29.35
(1)
18.9
(1)
29.35
(1)
Inferred 17.9 29.77 17.9 29.77
Note:
(1) Inferred resources cannot be included in total resource calculation under NI 43-101.
The above information regarding our Mines should be read in conjunction with the full text of this Offer
Document, including the WGM Technical Report set out in Appendix J to this Offer Document.
According to the CRU Industry Report, the P
2
O
5
content of a phosphate rock is the typical benchmark
by which phosphate rocks are valued and priced, as, inter alia, higher phosphate content typically means
lower impurity content and in turn, high reaction efciencies, less waste and fewer processing issues. The
CRU Industry Report estimates that the average grade of phosphate rock deposits in the PRC contains
below 20% P
2
O
5
content.
Based on the WGM Technical Report, the measured and indicated phosphorite resources found in each
of Mine 1 and Mine 2 contain an average P
2
O
5
content level of 28.7% and 29.4% respectively.
91
In view of the above, and considering that we obtained an aggregate of approximately 93,000 tonnes of
phosphate rocks with an average P
2
O
5
content of 30.6% for the period between 1 January and 30 June
2013, we believe that our phosphate rocks will be in demand from customers.
Mining process
We are responsible for the Mining Operations undertaken at our Mines. We have a dedicated team,
comprising 21 employees as at the Latest Practicable Date, responsible for the planning, designing,
management and overall supervision and safety of our Mining Operations.
The key activities with respect to the mining of our phosphorite resources are as follows:
(i) Mining
Both our Mines are underground mines comprising relatively higher density hard rock. Our mining
preparatory work is carried out from the bottom upwards from a lower to an elevated horizon.
Mining is then carried out from an elevated horizon downwards in horizontal slices, with the broken
ore being left in the excavation created for the miners to work from.
Our mining process comprises planning and development of stopes, construction of adits, division
of the lodes into mineable divisions, mining phosphate rocks and transportation of the phosphate
rocks to our processing facilities and customers.
Drilling
In order to optimise the recovery of high-quality phosphate rocks with high P
2
O
5
content level,
careful calculations are made as to the placement of drill holes and amount of explosives to be
used. We mine phosphate rocks progressively by drilling into designated points within the lodes
and charging such drill holes with explosives. During drilling, we spray water continuously to
minimise the inhalation of dust by miners.
Retrieving
After the explosives are detonated remotely, we retrieve the phosphate rocks that are removed
from the lodes from the force of the explosion. We observe safety precautions in the use of
explosives, such as ensuring that miners are at a safe distance prior to the detonation of
explosives, and ensuring that the lodes are well-ventilated from any harmful gases or residual dust
before the miners enter the adits.
Transport
Depending on the actual conditions of our Mines, including the slope angle of the relevant
phosphorite bed, we may then retrieve the phosphate rocks through a number of inter-level
phosphate ore passes, before loading the same onto mine carts. Once loaded onto the mine cart,
the phosphate rocks are transported via cable skips to our collection depot and subsequently via
trucks to the New Gongxing Facilities or to our customers thereafter. We engage third parties to
provide transportation services in transporting the phosphate rocks from our Mines to the New
Gongxing Facilities.
Facilities
We believe that the location of our Mines provides us with a conducive mining environment. For
example, the supply of water required for our Mining Operations is obtained from wells and rivers
near our Mines. In addition, electricity power supply at our Mines is provided by the State Grid
through its main electric power transmission-line system. We also have a back-up diesel generator
in the event of any disruptions to our electricity supply.
92
(ii) Exploration
Our exploration activities are centred on conducting exploration and drilling works in the areas for
which we have exploration rights to discover new phosphorite resources. We typically appoint a
professional geological company accredited under the applicable PRC laws, rules and regulations
which possesses the requisite experience and qualications to carry out the exploration work.
Based on the report issued by the professional geological company, we estimate the amount of
phosphorite resources within the explored area and thereafter apply to the relevant PRC authorities
to convert our exploration rights to mining rights.
Mining output
We mine phosphate rocks to be used as raw materials in our production of phosphate-based chemical
products, or sold to third parties. We sell our phosphate rocks primarily to other producers of phosphate-
based chemical products in Sichuan Province, the PRC.
From the date of acquisition of the Mines in 2002 to 31 December 2012, we have obtained an aggregate
of approximately 474,100 tonnes of phosphate rocks. As at the Latest Practicable Date, we are engaged
in Commercial Mining Operations at Mine 1 and Trial Mining Operations at Mine 2. We are in the process
of upgrading our mining facilities in Mine 2 to strengthen our safety procedures in accordance with
applicable PRC laws, rules and regulations. We expect to complete our upgrading works on our existing
adits in FY2013, comprising, inter alia, water supply, communications, and detecting and monitoring
systems. For the period from 1 January to 30 June 2013, we obtained approximately 93,000 tonnes of
phosphate rocks.
The mining output, phosphate rocks sold and average selling price of our phosphate rocks for FY2010,
FY2011, FY2012, and FP2013 are as follows:
FY2010 FY2011 FY2012 FP2013
Approximate mining output (tonnes) 4,200
(1)
30,200 60,100 16,600
Approximate phosphate rocks sold (tonnes) 4,600
(2)
20,100 42,100 12,200
Average selling price (per tonne)
(3)(4)
RMB384
(approximately
S$77)
(5)
RMB385
(approximately
S$75)
(5)
RMB445
(approximately
S$88)
(5)
RMB405
(approximately
S$80)
(5)
Notes:
(1) Based on mining output in November 2010 only, following our recovery from the Wenchuan Earthquake.
(2) Phosphate rocks sold include phosphate rocks from inventory.
(3) Computation of average selling price excludes applicable taxes.
(4) Please refer to the section entitled Managements Discussion and Analysis of Results of Operations and Financial Position
Review of Past Operating Results of this Offer Document for further details.
(5) Based on the average exchange rates for the respective nancial years/ period as set out in the section entitled Exchange
Rates and Exchange Controls of this Offer Document.
Co-operation arrangements
We enter into co-operation arrangements with third party partners in relation to our Mining Operations. As
at the Latest Practicable Date, we have entered into the following co-operation arrangements:
(i) Co-operation arrangement with Dashan
Under the Dashan Arrangement, it is intended that our Group and Dashan jointly carry out mining
operations within specied areas and in respect of certain adits within our Mines.
93
Pursuant to the Dashan Arrangement, (i) Dashan shall, inter alia, assist us in our application for the
relevant exploration and mining rights and bear related fees and costs, fund certain other expenses
arising from our Mining Operations and exploration activities and provide certain assets (such as
adits, machinery, technology and equipment) to Mianzhu Norwest for its Mining Operations; and
(ii) in relation to mining operations, our Group shall be responsible for, inter alia, the design and
construction of the Mines, sales of phosphate rocks, employment and purchase of social insurance
for miners. Depending on the level of capital investment by either party, the prots or losses, as the
case may be, after deducting applicable costs and taxes, from the sales of the phosphate rocks
obtained from such adits shall be apportioned between our Group and Dashan. Pursuant to the
Dashan Co-operation Agreements, if the enterprise nature of Mianzhu Norwest is changed due
to reform or other reasons, Mianzhu Norwest shall ensure (i) the preferential rights of Dashan to
participate in its reform or reorganisation; or (ii) the rights and obligations of Dashan under the
Dashan Co-operation Agreements remain unchanged. The Dashan Co-operation Agreements
for Mine 1 will expire and terminate on: (i) the exhaustion of the mineral resources in the agreed
mining areas; or (ii) the issuance of a stop order by the relevant government authorities. The
Dashan Co-operation Agreements for Mine 2 will expire and terminate on the later of: (i) the expiry
of the mining permits relating to the agreed mining areas; or (ii) the exhaustion of phosphorus rock
resources in the agreed mining co-operation areas.
As at the Latest Practicable Date, the Dashan Arrangement applies to Adit 1 and Adit 15 at Mine
1, and Adit 1815 at Mine 2. With regard to Adit 15, prots or losses, as the case may be, are
apportioned between Mianzhu Norwest and Dashan on a 50:50 basis. With regard to Adit 1 and
Adit 1815, prots or losses, as the case may be, are apportioned between Mianzhu Norwest and
Dashan on a 20:80 basis respectively. In respect of any future adits constructed and/ or operated
by Mianzhu Norwest within the co-operation areas covered under the Dashan Arrangement, prots
or losses, as the case may be, will be apportioned between Mianzhu Norwest and Dashan on a
20:80 basis respectively.

Please refer to the section entitled General Information on our Group Legal Opinion from King &
Wood Mallesons of this Offer Document for further details on the Dashan Arrangement.
(ii) Co-operation agreements with Lomon Products and Lomon Chemicals
We entered into a co-operation agreement with Lomon Products in 2011 to jointly utilise, inter
alia, the relevant facilities, the main tunnel transportation system, the electricity supply system, the
water supply and drainage system and the communication system to mine phosphate rocks (the
Joint Utilisation Agreements). Based on the geographical location of each of our Mines and
Lomon Products mines, (i) for the common shaft leading to Mine 1, we will utilise the common
shaft to carry out our Mining Operations rst until we have mined all phosphate rocks from Mine
1, before vacating for Lomon Products to utilise the common shaft; and (ii) for the common shaft
leading to Mine 2, Lomon Products will utilise the common shaft to carry out its mining operations
rst before vacating for our use. The rationale is that both parties will be able to save on tunnelling
costs since the same common shaft can be used to access each of our Mines and Lomon
Products mines. Neither party is obliged to make any payments to the other for the arrangements
under these agreements. The Joint Utilisation Agreements will expire and terminate upon Mianzhu
Norwests completion of the mining activities within the co-operation scope stipulated in the Joint
Utilisation Agreements.
We also entered into an agreement with Lomon Chemicals in 2012 in respect of Adit 1703 owned
by Lomon Chemicals (the Adit 1703 Agreement). Under the Adit 1703 Agreement, Lomon
Chemicals has granted us access to Adit 1703 for the mining of phosphate rocks. This is provided
that our Mining Operations are within the scope of the mining rights that we hold. Once we use
Adit 1703, we shall be responsible for all costs and expenses for the Mining Operations undertaken
in Adit 1703, and all phosphate rocks obtained from Adit 1703 shall be sold at a discounted price
to Lomon Chemicals. To date, we have not carried out any mining operations or transactions with
Lomon Chemicals under the Adit 1703 Agreement. There is no expiry or termination date specied
in the Adit 1703 Agreement.
94
Mining Operations approvals and permits
We have obtained the relevant approvals and permits, including the Mining Safety Production Permit for
Mine 1, and are engaged in Commercial Mining Operations at Mine 1 pursuant to the Commercial Mining
Notication issued by the Mianzhu Safety Bureau.
We are engaged in Trial Mining Operations at Mine 2 pursuant to the Trial Mining Notications issued by
the Mianzhu Safety Bureau to assist us in resuming mining operations after the Wenchuan Earthquake.
We will be able to carry out Commercial Mining Operations for Mine 2 after we receive the Mining Safety
Production Permit for Mine 2.
The Legal Advisers to our Company on PRC Law, King & Wood Mallesons, have advised that:
(i) under relevant PRC mining laws and regulations, there are no denitions for either trial mining
operations or commercial mining operations;
(ii) the only legal restrictions imposed on Mianzhu Norwests Mining Operations at Mine 1 and Mine
2 relating to the quantum of phosphate rocks which may be mined, are the approved annual
production scales of 50,000 tonnes of phosphate rocks and 200,000 tonnes of phosphate rocks
for Mine 1 and Mine 2, respectively. These approved annual production scales are not affected by
whether our Mining Operations are classied as trial mining operations or commercial mining
operations; and
(iii) the Trial Mining Notications do not stipulate any time limit for the conversion of Trial Mining
Operations to Commercial Mining Operations.
As at the Latest Practicable Date, we are engaged in upgrading our facilities at Mine 2 for the purposes
of obtaining, inter alia, the Mining Safety Production Permit to resume Commercial Mining Operations for
Mine 2.
Please see the section entitled General Information on our Group - Legal Opinion from King & Wood
Mallesons of this Offer Document for further details on the Mining Safety Production Permit and other
approvals and permits required for our Mining Operations.
CHEMICAL PRODUCTION OPERATIONS
Prior to the Wenchuan Earthquake and the Relocation Exercise, we produced our range of phosphate-
based chemical products at our Previous Hanwang Facilities. For FY2007 (prior to the Wenchuan
Earthquake in 2008), we produced approximately 4,400 tonnes of P
4
, approximately 9,800 tonnes of
thermal phosphoric acid, approximately 6,700 tonnes of STPP and approximately 4,700 tonnes of SHMP,
at our Previous Hanwang Facilities, for sale to our customers in the PRC and overseas.
As at the Latest Practicable Date, we have completed the construction of the P
4
Plant at the New
Gongxing Site under Phase 1 of the Rebuilding Programme. The designed productive capacity of the P
4

Plant, which has two (2) production furnaces, is 20,000 tonnes per year.
We are also currently in the preliminary stages of Phase 2 of the Rebuilding Programme.
Our production of STPP at our Previous Hanwang Facilities (which had a designed productive capacity of
30,000 tonnes per year) was minimal after the Wenchuan Earthquake in 2008. For FY2010 and FY2011,
we produced STPP amounting to approximately 900 tonnes and approximately 2,100 tonnes respectively,
in order to continue supplying to certain customers.
After moving our STPP plant to the New Gongxing Site pursuant to the Relocation Exercise, we
conducted nal stage processing on prior inventory reserves of STPP amounting to approximately 600
tonnes in FY2012. The designed productive capacity of the STPP plant (which is temporarily located at
the New Gongxing Site) is expected to be 30,000 tonnes per year. For the period from 1 January 2013 up
to the Latest Practicable Date, we processed approximately 200 tonnes of STPP.
95
New Gongxing Site - Rebuilding Programme
The Rebuilding Programme comprises two (2) scheduled phases.
Phase 1
Phase 1 of the Rebuilding Programme includes the construction of:
(i) our raw materials preparation line which includes customised storage areas, inspection, crushing,
sizing, drying and measuring equipment and facilities;
(ii) two (2) new P
4
furnaces, each with a designed capacity of 10,000 tonnes of P
4
per year with
customised storage tanks;
(iii) water treatment plant; and
(iv) other ancillary facilities.
The facilities on Phase 1 Land are designed to withstand earthquakes of up to 7.0 on the Richter
magnitude scale.
Upon commencement of Commercial Chemical Production Operations on Phase 1 Land, our Group will
be able to process and rene phosphate rocks to produce P
4
.

As we are using current technology and
equipment in our Rebuilding Programme, which, inter alia, utilises less electricity and power compared
to our Previous Hanwang Facilities, we expect to be able to enjoy additional cost savings from greater
production efciency and productivity.
Phase 2
Phase 2 of our Rebuilding Programme includes the following:
(i) construction of a new thermal phosphoric acid plant, with designed capacity of 30,000 tonnes per
year;
(ii) relocation and upgrading of a food grade and non food grade STPP plant, with designed capacity
of 30,000 tonnes per year; and
(iii) construction of a food grade and non food grade SHMP plant, with designed capacity of 20,000
tonnes per year.
As at the Latest Practicable Date, we have expended approximately RMB4.6 million on Phase 2 of our
Rebuilding Programme.
96
Production process
Upon the completion of our Rebuilding Programme, our production process will include the following
steps as set out below:

Phosphate Rocks

P
4
Thermal Phosphoric
Acid

SHMP
(food/non food grades)

STPP
(food/non food grades)
P
4
Processing
Acid
Manufacturing

STPP Manufacturing SHMP Manufacturing
(i) P
4
Processing
We rene phosphate rocks to produce P
4
using a mixture of coke and silica and subjecting the
mixture to high temperatures of between 1,300 C and 1,500 C. Prior to this process, the raw
materials are rst crushed and sized to ensure uniformity in size and subsequently dried. The
electric furnaces use electrodes to supply the heat necessary to cause the chemical reaction
between the raw materials. This reaction produces gaseous P
4
, ferrophosphate, slag, sludge and
ue gas.
The gaseous P
4
is cooled under water to form yellow phosphorus which we will sell to our
customers. Flue gas can be recycled as fuel. Slag and ferrophosphate will be sold to nearby
cement and steel industries respectively. Sludge will either be sold or used for production of low-
grade phosphoric acid.
(ii) Acid Manufacturing
Thermal phosphoric acid is obtained by burning P
4
in a furnace together with steam and hydrogen
peroxide. Water is then sprayed onto the mixture in order to achieve the desired concentration,
before purifying the same to produce thermal phosphoric acid. Depending on specications
required by our customers and types of applications, additional processing may be required.
97
(iii) SHMP Manufacturing
SHMP is manufactured by heating a mixture of thermal phosphoric acid, soda ash and natural gas
under controlled conditions. The raw materials are then subject to further processing and blending
before SHMP is produced.
(iv) STPP Manufacturing
STPP is manufactured by mixing thermal phosphoric acid, soda ash and natural or ue gas under
controlled conditions. This mixture is then subject to heating in furnaces and further cooling and
polymerisation before STPP is produced. Depending on market demands, we have the exibility of
producing other phosphate-based chemical products from the same STPP plant.
INDEPENDENT VALUATION
In preparation for the Invitation, our Company appointed JLLCAA to conduct an independent valuation
of the Mines and the P
4
Plant. The Independent Valuation Report has been prepared and presented in
accordance with the VALMIN Code. The valuation was carried out on a Fair Market Value basis. For this
purpose, the term Fair Market Value is dened as the amount of money (or the cash equivalent of
some other consideration) determined by the expert in accordance with the provisions of the VALMIN
Code for which the mineral or petroleum asset or security should change hands on the Valuation Date
in an open and unrestricted market between a willing-buyer and a willing-seller in an arms length
transaction, with each party acting knowledgeably, prudently and without compulsion.

Based on the results of JLLCAAs investigations and analysis outlined in the Independent Valuation
Report, JLLCAA is of the opinion that the Fair Market Value of the Mines and the P
4
Plant as at 31
March 2013 is between RMB1.0 billion (or approximately S$207.6 million
(1)
) and RMB1.6 billion (or
approximately S$332.1 million
(1)
) with the preferred value being RMB1.3 billion (or approximately S$269.8
million
(1)
).
The above information should be read in conjunction with the full text of this Offer Document, including
the Independent Valuation Report as set out in Appendix K to this Offer Document.
The combined nancial statements of our Group for the Period Under Review does not account for the
Fair Market Value of the Mines and the P
4
Plant outlined in the Independent Valuation Report.
Note:
(1) Based on the Exchange Rate.
CORPORATE SOCIAL RESPONSIBILITY
We are committed to being a responsible corporate citizen and consider the physical and human
environment when making our business decisions.
Environmental Measures
As our Groups operations are based in the PRC, we have currently set aside a portion of our operating
budgets (approximately RMB155,000 in aggregate per annum) to ensure that Mianzhu Norwests
operations comply with all applicable PRC environmental laws, rules and regulations. We intend to
take progressive steps to further improve the operations and facilities of Mianzhu Norwest beyond the
requirements of applicable PRC environmental laws, rules and regulations. For example, we have plans
to construct a ue gas storage facility which will enable Mianzhu Norwest to collect and use recycled gas
for its operations and reduce the impact on the environment. We intend to fund the construction of the
ue gas storage facility using part of the net proceeds from the issuance of New Shares. Please refer to
the section entitled General Information on our Group - Business Strategies and Future Plans of this
98
We recognise that environmental monitoring is an ongoing obligation. It is noted in the WGM Technical
Report that various conditions and practices of Mianzhu Norwest would not meet the standards of
international best practices presently. In view of this, we intend to engage and work with appropriately
qualied professional rms, such as WGM, to progressively improve and bring the operations of Mianzhu
Norwest in line with the standards of international best practices (such as the applicable environmental
standards of the ISO). As the improvements and/ or the standards to be adopted have not been identied
or committed, we have yet to allocate a budget for the same.
The information in this section should be read in conjunction with the full text of this Offer Document,
including the WGM Technical Report set out in Appendix J to this Offer Document.
Mining
Our mining infrastructure has been constructed to comply with the relevant PRC environmental laws
and regulations. We have a mining department, headed by our Key Executive, Luo Guangming, who is
responsible for conducting regular environmental monitoring exercises to ensure that we comply with the
environmental regulations in relation to our Mining Operations.
A summary of the mitigating measures taken in relation to certain Mining Operations are set out below:
Activity Mitigating Measures
Site preparation, drilling
and mining
Personal protection masks are issued to workers to provide
protection from dust
Water is used with certain drilling, mining and site preparation works
Waste water and sand
generation
Embankment walls are built to minimise sand and waste water from
entering the river
Waste sand may be used to ll defunct mining adits and tunnels
Movement of land-based
trafc within, to and from
the mining site
Access roads are widened to ease trafc movement
Entry into active mining areas are restricted to vehicles used for
mining operations only
Closure of the mine Monetary contribution are paid for timberland compensation and
forest recovery fund for the occupied land bi-yearly to the Deyang
Forestry Bureau
Further monetary provision is made for rehabilitation and
reforestation upon closure of mine
Waste sand may be used to ll defunct mining adits and tunnels
We received a conrmation letter dated 18 January 2012 from the Mianzhu Environmental Bureau
conrming, inter alia, that the mining and the other production and operation activities of Mianzhu
Norwest are in compliance with relevant PRC environmental laws, rules and regulations. For further
details, please refer to the sections entitled General Information on our Group Legal Opinion from King
& Wood Mallesons and General Information on our Group PRC Government Regulations of this Offer
Document.
P
4
Plant
Our processing plants were designed to comply with the relevant PRC environmental laws and
regulations. We have a safety and environment team which is responsible for conducting regular
environmental and safety monitoring exercises to ensure that we comply with the relevant safety and
environmental regulations.
99
We have constructed facilities to contain waste water generated from the production of P
4
. The water is
then recycled for the production of P
4
.
We also recycle the by-products from the production of P
4
, such as ferrophosphate, slag and sludge, by
selling these by-products to nearby industries which require them for their production.
We plan to build a ue gas storage facility to collect the ue gas generated from the production of P
4
.
The ue gas will be used in the heating process for production of STPP and SHMP. Please refer to the
section entitled General Information on our Group - Business Strategies and Future Plans of this Offer
As a testament to our commitment to higher operating standards, we have voluntarily adopted a system
conforming to ISO 14001 for our Chemical Production Operations, similar to the system used for our
Chemical Production Operations at the Previous Hanwang Facilities. This framework assists us to identify
the best practices in environment management standards so as to conform to legislative requirements,
special chemical production regulatory commitments and general corporate objectives.
Community Development
We endeavour to make a positive impact on the lives of people who live in the areas where we have a
presence.
We try, as far as practicable, to employ local workers in each location in which we operate. We provide
these workers with training and skills development.
We also participate in local community projects in the vicinity of our business operations in Mianzhu City,
Sichuan Province, PRC. In 2007, we set up an education fund which provided educational bursaries and/
or donations to primary, secondary and university students with nancial difculties. After the Wenchuan
Earthquake, we donated a sum of money to an affected local village, (Xiangshan Village), and
a primary school located in the vicinity of Mianzhu City, Sichuan Province, PRC, to assist them in
restructuring and recovery work.
QUALITY ASSURANCE
We place great emphasis on the quality of our phosphate rocks and our phosphate-based chemical
products. We believe that having an established quality management system is one of the main factors
contributing to our success and reputation as a producer of quality products.
The following quality management and control procedures have been adopted by our Group:
Mining phosphate rocks
We monitor the quality of our phosphate rocks through on-site inspections and regular sampling at the
Mines and/ or the New Gongxing Facilities. For approximately every 200 tonnes of phosphate rocks, we
conduct internal laboratory testing and separate the phosphate rocks according to quality. This ensures
that the specications of our phosphate rocks are consistent.
Production of phosphate-based chemical products
We have implemented the following quality management and control procedures in respect of our
Chemical Production Operations at Phase 1, and will adopt similar procedures for Phase 2:
(1) Procurement of raw materials
We assess our suppliers before we make purchases of raw materials based on pre-determined
criteria such as reputation, quality, the ability to meet our delivery and quality requirements and
cost competitiveness.
To ensure consistency in the quality of incoming raw materials that are used in our production
process, we conduct sample checks and tests on the raw materials prior to accepting delivery of
the raw materials.

100
(2) Quality control during production
We perform various sample quality checks at every stage of the production process to ensure
consistency in the quality of our products and to ensure that defective semi-nished products do
not proceed to the next stage of production.
(3) Quality control for nished products
We inspect samples from each batch of nished products to ensure that our products comply with
our internal quality control guidelines. The tests that we conduct include checking the physical
appearance and the relevant chemical composition of our products.
All nished products that pass the quality control inspection are then stored in our warehouse.
We conduct a nal round of quality control inspection prior to packaging and delivery of our
nished products to our customers, to ensure that they conform to our customers requirements.
In the event that we are required to deliver our nal products, we select reputable delivery or
transportation agents, in order to ensure that our customers receive our products in satisfactory
condition.
(4) Review of quality management system and maintenance of machinery and equipment
As part of our continuing assessment and review on our quality management system, we obtain
feedback from our employees, from time to time, for the purposes of improving the efcacy of our
quality control processes.
Our customers may also visit us at our facilities to assess our quality standards. Thereafter, we
may discuss and review any feedback from our customers and modify our quality management
systems to meet our customers requirements.
We also conduct regular checks and maintenance of our production facilities to ensure efcient
operations.
(5) Obtaining accreditation for our phosphate-based chemical products
Prior to the Wenchuan Earthquake, we had obtained accreditations for our processes at the
Previous Hanwang Facilities such as (i) ISO 9001; (ii) ISO 14001; and (iii) certication from the
KOF-K Kosher Supervision. We intend to obtain similar accreditations in respect of our New
Gongxing Facilities.
Quality control / safety standards
Our staff plan, manage and supervise the overall development and quality of our phosphorite resources
in order to ensure that we meet the quality and production safety standards.
Miners
We ensure that our miners and our outsourced miners pass the relevant health check-ups, possess
the requisite qualications, experience, social and commercial insurance and safety permits obtained
after attending trainings organised by the relevant local safety and inspection authorities, before they
undertake any work at our Mines.
101
Safety and Environment Team
We have a safety and environment team which implements and promotes applicable legal and internal
safety regulations, including (i) conducting periodic safety audits and ensuring safety requirements are
met; (ii) conducting in-house or outsourced safety training for all our employees as well as outsourced
miners; (iii) conducting investigations and handling all incident reports and implementing pre-emptive
measures to prevent repeat occurrence of such incidents; (iv) liaising with all external safety authorities
and implementing new safety regulations; (v) reviewing and improving our safety management system;
and (vi) transportation, handling and storage of explosives and other hazardous materials in accordance
with applicable legal requirements. Other preventive measures that we have implemented include (i) daily
site monitoring by the designated safety ofcer for each adit; (ii) ensuring that all workers wear safety
gear while they are at our Mines; and (iii) cultivating a safety is priority culture.
We are subject to regular and ad hoc inspections by the local safety authorities to ensure that the
requisite safety requirements are met before we are allowed to continue with our Mining Operations.
Please refer to the section entitled General Information on our Group Mining Operations approvals
and permits of this Offer Document for further details. As at the Latest Practicable Date, we are in
the process of upgrading our facilities in Mine 2. As at the Latest Practicable Date, we have not been
penalised by the relevant PRC safety bureau and we are not aware of any material non-compliance with
applicable safety regulations.
INTELLECTUAL PROPERTY
Trade marks
We believe that our trade marks are of importance to our brand-building efforts and the marketing of our
products.
As at the Latest Practicable Date, our Group owns the following trade mark:
Trade mark Registered
Owner
Place of
Registration
Class Trade mark
Number
Validity Period
The Company Singapore 1
(1)
T1219484E Ten (10) years
commencing from
20 December 2012
Note:
(1) Trade marks under Class 1 of the Nice Classication relate to, inter alia, acids; chemicals for use in industry; chemicals
for use in manufacture; chemical compounds for use in the manufacture of industrial preparations; chemical products for
use in industry; chemicals used in industry; chemical products for use in manufacturing; chemical preparations for scientic
purposes, other than for medical or veterinary use; chemical reagents, other than for medical or veterinary purposes;
chemical substances for analyses in laboratories, other than for medical or veterinary purposes; chemicals (Agricultural ),
except fungicides, weedkillers, herbicides, insecticides and parasiticides; chemicals for forestry, except fungicides, herbicides,
insecticides and parasiticides; industrial chemicals; phosphates fertilisers; phosphatides; phosphoric acid; phosphating agents;
phosphating compounds; phosphorus; raw chemicals.
102
In addition, our Group has applied to register the following trade mark with the Intellectual Property Ofce
of Singapore:
Trade mark Applicant Place of
Application
Class Trade mark
Number
Status
The Company Singapore 1
(1)
T1219486A Pending
Note:
(1) Trade marks under Class 1 of the Nice Classication relate to, inter alia, acids; chemicals for use in industry; chemicals
for use in manufacture; chemical compounds for use in the manufacture of industrial preparations; chemical products for
use in industry; chemicals used in industry; chemical products for use in manufacturing; chemical preparations for scientic
purposes, other than for medical or veterinary use; chemical reagents, other than for medical or veterinary purposes;
chemical substances for analyses in laboratories, other than for medical or veterinary purposes; chemicals (Agricultural ),
except fungicides, weedkillers, herbicides, insecticides and parasiticides; chemicals for forestry, except fungicides, herbicides,
insecticides and parasiticides; industrial chemicals; phosphates fertilisers; phosphatides; phosphoric acid; phosphating agents;
phosphating compounds; phosphorus; raw chemicals.
Domain Names
As at the Latest Practicable Date, our Company has registered the following domain name:
Domain Name Registered Owner Expiry Date
www.asiaphos.com The Company 22 February 2022
Our business or protability is not materially dependent on any registered trade mark, patent or other
intellectual property rights.
RESEARCH AND DEVELOPMENT
Our Group has not incurred any expenditure on research and development activities for the Period
Under Review and for the period commencing from 1 April 2013 up to the Latest Practicable Date.
However, moving forward, we may undertake development activities to widen our range of phosphate-
based chemical products. Please see the section entitled General Information on our Group - Business
Strategies and Future Plans of this Offer Document for further details.
INSURANCE
For the Period Under Review and for the period commencing from 1 April 2013 up to the Latest
Practicable Date, we were in compliance with applicable PRC laws, rules and regulations with respect to
obtaining insurance for our employees, including social insurance.
In addition, we have obtained, inter alia, property insurance for our key equipment and assets for certain
losses including oods, earthquakes and other disasters, business interruption insurance, employers
liability insurance, delity guarantee insurance and money insurance.
Our Directors are of the view that our existing insurance coverage from the above insurance policies is
adequate having regard to the size and nature of our operations. As we are carrying out our Rebuilding
Programme, we are also working on customising further insurance coverage for our Chemical Production
Operations as they become operational. We periodically review and assess our risks and make
necessary adjustments to our insurance coverage to meet our needs and comply with industry practice in
the PRC.
103
SALES AND MARKETING
Our CEO and Executive Director, Dr. Ong Hian Eng, and Key Executive, Wang Xuebo, oversee our
sales and marketing department, which is responsible for our domestic sales and exports. Our sales
and marketing department handles (i) formulating sales and marketing strategies; (ii) establishing
and maintaining relationships with new and existing customers; (iii) direct marketing, trade fairs and
conferences; and (iv) providing after-sales customer service. From time to time, we are also approached
directly by customers.
CREDIT MANAGEMENT
Customers
Customers of our phosphate rocks are normally required to make full payment before they can take
delivery of phosphate rocks. In FP2013, one of our customers purchased our phosphate rocks and made
partial payment by way of a promissory note, issued by a nancial institution in the PRC. The promissory
note, which matured in June 2013, was for an amount of S$0.2 million and was fully redeemed in June
2013.
We generally require customers of our phosphate-based chemical products to make payment within 30 to
60 days from delivery.
The trade receivables turnover for our Group for FY2010, FY2011, FY2012 and FP2013 based on credit
sales of our phosphate-based chemical products were as follows:
FY2010 FY2011 FY2012 FP2013
Trade receivables turnover (days)
(1)
41 27 51 53
Note:
(1) Trade receivables turnover is calculated on the basis of the average trade receivables divided by total credit sales of our
phosphate-based chemical products multiplied by 365 days or 90 days, as applicable. Average trade receivables is the
average of the opening and closing balances for the nancial year/ period.
Our trade receivables turnover of 41 days, 51 days and 53 days in FY2010, FY2012 and FP2013
respectively are within the credit period we usually extend to our customers. The lower trade receivables
turnover in FY2011 was mainly a result of lower sales of STPP towards the end of FY2011.
Our trade receivables as at 31 March 2013 were approximately S$0.5 million, 99.3% of which have been
collected as at the Latest Practicable Date.
Suppliers
We pay our suppliers of raw materials on cash terms. With respect to purchases of services for our
Mining Operations, including payment to our co-operation partner, there are no formal credit terms.
The trade payables turnover for our Group for FY2010, FY2011, FY2012 and FP2013 were as follows:
FY2010 FY2011 FY2012 FP2013
Trade payables turnover (days)
(1)
42 54 116 109
Note:
(1) Trade payables turnover is calculated on the basis of the average trade payables divided by total cost of sales multiplied
by 365 days or 90 days, as applicable. Average trade payables is the average of the opening and closing balances for the
nancial year/ period.
104
In FY2010, we repaid certain of our suppliers after receiving a bank loan. Furthermore, as our Group
gradually increased the scale of our Mining Operations from FY2010, trade payables turnover gradually
increased from 42 days in FY2010 to 54 days in FY2011. The increase in trade payables turnover was
mainly brought about by the increase in the scale of Mining Operations.
In particular, as a result of favourable weather conditions in the winter season of 2012, our Mining
Operations were extended, and we obtained an aggregate of approximately 60,100 tonnes of phosphate
rocks in FY2012, compared to approximately 30,200 tonnes of phosphate rocks in FY2011. This led to a
signicant increase in the amounts payable related to our Mining Operations, including payments to our
co-operation partner and other contractors.
In FP2013, our Group resumed Mining Operations in March 2013 and obtained approximately 16,600
tonnes of phosphate rocks in the same month. This led to an increase in the amounts payable related to
our Mining Operations. However, as our Group continued to repay its suppliers, trade payables turnover
declined to 109 days.
Our trade payables as at 31 March 2013 were approximately S$0.8 million, of which 70.9% has been
paid as at the Latest Practicable Date.
STAFF TRAINING AND DEVELOPMENT
The training that we provide can be divided into basic training, compulsory training and supplementary
training and may be conducted in-house or outsourced to external trainers.
Basic training includes orientation training and occupational safety training. Orientation training is
conducted to educate our new employees on company policies and basic skills and knowledge which
would be relevant to their respective job functions, such as the operation of relevant machinery and
equipment. Occupational safety training is conducted to equip our employees on occupational safety and
to educate them on safety standards and precautions to be undertaken in the course of their work.
Compulsory training is training required by applicable laws and regulations, including continual
professional education on an annual basis, in particular for engineers and employees engaged in our
Mining Operations, Chemical Production Operations, and/ or handling of chemicals and explosives. Such
training is typically organised by the relevant accrediting organisations, governmental bodies and quality
assurance associations.
Supplementary training is training conducted to enhance the skills of our employees, including training
to update them on the latest development trends and technologies and personal improvement. Selected
employees may be sent for external short term training courses. For example, our nance staff may
attend courses and seminars conducted by external organisations to keep abreast with changes in
accounting requirements.
Our Groups staff training expenses for each of FY2010, FY2011, FY2012 and FP2013 were not
signicant.
SEASONALITY
Our Groups Mining Operations and Chemical Production Operations are subject to certain seasonal
uctuations.
As part of our safety policy, our Mining Operations are halted annually during (i) the winter season, which
typically lasts from mid-December to mid-March; and (ii) the rainy season, which typically lasts from
early July to the end of August. Barring unforeseen circumstances, we undertake Mining Operations for
about seven (7) months per year on a daily basis, subject to, inter alia, holidays, weather conditions and
equipment maintenance.
105
During the low-water periods, which typically last from mid-November to mid-April, our electricity costs
increase and we may not produce P
4
, the process for which requires high levels of electricity, unless
justied by sufciently high market prices of P
4
.
We are able to mitigate the seasonality effect to a certain extent by maintaining buffer stocks of
phosphate rocks and P
4
.
We generally do not experience any signicant seasonality patterns in the demand for our phosphate
rocks and phosphate-based chemical products.

INVENTORY MANAGEMENT
We intend to maintain optimal levels of our inventory, comprising (i) packaging and raw materials; and
(ii) phosphate-based chemical products. We plan to do so by taking into account, inter alia, weather
conditions, uctuations in the prices of raw materials, secured orders placed by customers, estimated
future sales and production needs and price trends of our products.
In order to ensure that our inventory is managed efciently and effectively, we monitor our inventory
through monthly inventory counts. Any discrepancies between our inventory counts and nancial records
will be reconciled monthly and adjusted on a quarterly basis. Our inventory turnover for FY2010, FY2011,
FY2012 and FP2013 were as follows:
FY2010 FY2011 FY2012 FP2013
Inventory turnover (days)
(1)
389 427 388 322
Note:
(1) Inventory turnover is calculated on the basis of the average inventory divided by total cost of sales multiplied by 365 days or
90 days, as applicable. Average inventory is the average of the opening and closing balance of the relevant nancial year/
period.
Our inventory turnover for FY2010, FY2011, FY2012 and FP2013 was high as part of our Previous
Hanwang Facilities was damaged due to the Wenchuan Earthquake. Consequently, we faced
production constraints and could not use the raw materials which we had purchased. At the same time,
we maintained stocks of SHMP and STPP to continue supplying to certain customers. Our inventory
turnover days increased in FY2011 as we produced more STPP inventory in anticipation of the temporary
cessation of our Chemical Production Operations pursuant to the Relocation Exercise. In FY2012 and
FP2013, our inventory turnover days decreased due to continued sales of our products.
We also typically maintain buffer stocks of phosphate rocks and P
4
to mitigate the seasonality effect.
106
MAJOR SUPPLIERS
We are not dependent on any single supplier. Our suppliers comprise mainly suppliers of raw materials
which are required for our Chemical Production Operations and our co-operation partners. The suppliers
of raw materials who accounted for ve per cent. (5%) or more of the costs of raw materials and services
for FY2010, FY2011, FY2012 and FP2013 were as follows:
Name of Supplier
Nature of
Supply
% of our Groups total purchases
FY2010 FY2011 FY2012 FP2013
(Deyang City Xingyuan Industrial Explosive

Material Co., Ltd)
Explosives 0.5 1.4 7.0 7.4
(Hanwang Natural Gas Co., Ltd) (Hanwang)

Natural gas 3.1 5.0 2.0 5.9
(Leshan Jiaming Chemical Co., Ltd.) (Leshan)

P
4
37.2
(Mianyang Aostar Phosphorus Chemical Industry

Co., Ltd.) (Aostar)
Phosphoric acid 25.7 8.3
(Mianzhu Maoyuan Phosphate Chemical Co., Ltd.)

(Maoyuan)
P
4
19.6
(Sichuan Mianzhu Ronghong Chemical Co., Ltd.)

(Ronghong)
Phosphoric acid 12.0 22.7
(Sichuan Province Jinlu Resin Co., Ltd ) (Jinlu)

Alkali 5.7 13.5 11.6 4.5
The amounts that accrued to Dashan under the Dashan Arrangement accounted for approximately
5.2%, 8.6%, 19.7% and 11.8% of our Groups cost of purchase of raw materials and services in FY2010,
FY2011, FY2012 and FP2013 respectively. Please refer to the section entitled General Information on
our Group Mining Operations - Co-operation arrangements of this Offer Document for further details.
Due to the damage caused by the Wenchuan Earthquake to our Previous Hanwang Facilities and the
resultant disruption to our Chemical Production Operations, we purchased raw materials, including P
4

and phosphoric acid from various suppliers, for the production of STPP and SHMP to full outstanding
contractual obligations and to supply to certain customers.
Our Group did not purchase P
4
after FY2010, which led to the reduction in the purchases from Leshan
and Maoyuan.
Our Group purchased phosphoric acid for our STPP production in FY2011 and for our nal-stage STPP
processing operations in FY2012 and FP2013. The purchases made from Aostar reduced in FY2012
and FP2013 due to the Relocation Exercise, pursuant to which we ceased STPP production and only
conducted nal-stage STPP processing and the sourcing from a new supplier, Ronghong.
The purchase of explosives which are used in our Mining Operations increased from FY2010 to FP2013
in line with the resumption of our Mining Operations in late FY2010 and a subsequent increase in the
scale of Mining Operations thereafter.
Purchases of alkali from Jinlu increased in FY2011 as our Group produced more STPP in FY2011.
However, with the reduction in production of STPP after FY2011, our purchases of alkali from Jinlu
declined in FY2012 and further declined in FP2013.
107
Purchases of natural gas from Hanwang increased from FY2010 to FY2011 as, in anticipation of the
Relocation Exercise, we increased production to increase our STPP inventory. Purchases of natural gas
declined from FY2011 to FY2012 as our Chemical Production Operations were temporarily suspended
whilst we undertook the Relocation Exercise and conducted limited nal-stage processing of STPP in
the last quarter of FY2012 after the completion of the Relocation Exercise. Purchases of natural gas
subsequently increased from FY2012 to FP2013 as we engaged in further nal-stage processing of
STPP.
None of our Directors, Substantial Shareholders or their Associates has any interest, whether direct or
indirect, in any of the above-mentioned suppliers.
MAJOR CUSTOMERS
We are not dependent on any single customer as our Directors are of the view that phosphate rocks and
phosphate-based chemical products are akin to commodities. The customers who accounted for ve per
cent. (5%) or more of our Groups turnover for FY2010, FY2011, FY2012 and FP2013 are as follows:
Name of Customer
Product
Segment
% of our Groups total revenue
FY2010 FY2011 FY2012 FP2013
Aostar Phosphate rocks 15.7 41.3
Lomon Chemicals Phosphate rocks 62.8
Maoyuan Phosphate rocks 12.4 4.6
(Mianzhu Tiansheng Mining Co., Ltd.)

Phosphate rocks 5.2 3.2
(Sichuan Mianzhu Sanjia Feed Co., Ltd.) (Sanjia)

Phosphate rocks 11.4 5.8
Chemical Direct Inc. (CDI) STPP 23.3 15.2
Corporacin Andaluza De Traco Comercial,
Suminstros Y Ventas Industriales, S.L
STPP 5.1
(Diversey Hygiene (Guangdong) Ltd.) (Diversey)

STPP 6.1 12.4 3.6 3.3
Interchem Agencies Limited STPP 5.3 4.6 5.8 2.4
Mifa AG Frenkendorf (MAF) STPP 9.8 3.1

(Procter & Gamble (China) Ltd.) (P&G)
STPP 5.9 9.9 2.8
Vadoudi Mod General Trading L.L.C. (Vadoudi) STPP 0.9 9.7
Sales to our customers uctuate from year to year largely due to uctuations in our customers demand
for our products and our ability to manufacture and produce our phosphate-based chemical products to
meet our customers requirements.
We resumed our Mining Operations in FY2010 but we only conducted Mining Operations for one (1)
month in FY2010. Sales of phosphate rocks only started to increase in FY2011 and further increased in
FY2012 and FP2013 as our Group increased its inventory of phosphate rocks from its Mining Operations.
The Relocation Exercise in FY2011, and our Rebuilding Programme which is still ongoing, also affected
our ability to produce phosphate-based chemical products to meet our customers requirements in
FY2012 and FP2013.
We sold phosphate rocks to Aostar in FY2011 and FY2012 and to a new customer, Sanjia, in FY2012, as
Aostar and Sanjia provided more competitive pricing for our phosphate rocks.
108
There were no sales to Aostar in FP2013 due to the absence of demand from Aostar. For FP2013, the
sales to Sanjia declined due to the lower demand from Sanjia.
For FP2013, we sold phosphate rocks to Lomon Chemicals as they provided more competitive pricing for
our phosphate rocks.
Sales of phosphate rocks to Maoyuan declined in FY2011 and there were no sales to Maoyuan in
FY2012 and FP2013 due to the lower and absence of demand from Maoyuan respectively.
Sales of STPP to CDI and MAF declined in FY2011. Although sales of STPP to CDI remained at around
the same level in FY2010 and FY2011, a decline in percentage was recorded due to the higher total
revenue recorded by our Group in FY2011. Sales of STPP to MAF declined due to lower demand from
MAF.
There were no sales to CDI or MAF in FY2012 and FP2013 due to the absence of demand from CDI and
MAF.
Sales of STPP to Vadoudi increased in FY2011 as we were able to supply STPP which met Vadoudis
specications. However, as we did not have STPP that met Vadoudis requirements in FY2012, no sales
to Vadoudi were recorded in FY2012.
The uctuations in sales to Diversey and P&G were due to the uctuations in demand for STPP from
these customers.
In FP2013, we secured Corporacin Andaluza De Traco Comercial, Suminstros Y Ventas Industriales,
S.L as a new customer.

None of our Directors, Substantial Shareholders or their Associates has any interest, whether direct or
indirect, in any of the above-mentioned customers.
PROPERTIES AND FIXED ASSETS
Location Grantee
Description
of Permit /
Right
Duration
of Permit /
Right
Land Area
(sq m)
Use of
Property Encumbrance
(Fa Mu Chang
Forest Area, Deyang
City)
Mianzhu
Norwest
Temporary
Occupancy
of forestry
land for our
Mines
Until 31
July 2014
24,564
(1)
Mining
Operations
Xiangliu Village,
Gongxing Town,
Mianzhu City
Mianzhu
Norwest
Land Use
Rights
Until 17
October
2061
54,862.7 Chemical
Production
Operations
Mortgaged to the
Bank of China
Limited, Mianzhu
Branch
Note:
(1) Based on 2.4564 hectares converted at 1 hectare = 10,000 sq m.
Land Occupation in respect of our Mines
As at the date of this Offer Document, Mianzhu Norwest is conducting its Mining Operations on forestry
land with an approximate area of 2.4564 hectares.
Phase 1 Land
On 18 October 2011, Mianzhu Norwest entered into a contract with the Mianzhu Land Bureau for
assignment of the state-owned industrial land use rights for Phase 1 Land. Our Group has paid
consideration of approximately RMB8.2 million in respect of the land use rights for Phase 1 Land.
109
Phase 2 Land
On 27 December 2010, Mianzhu Norwest entered into a letter of intent with the Mianzhu Resettlement
Ofce, pursuant to which Mianzhu Norwest agreed to participate in the auction process for Phase 2 Land.
As at the Latest Practicable Date, Mianzhu Norwest has (i) paid a fully-refundable partial deposit of
RMB8 million; and (ii) received the (Red Line Drawings of Land) for Phase 2 Land, the
(a notice for Phase 2 Land issued by the Mianzhu Planning
Bureau), the (Construction Land Planning Permit), the
(Construction Project Planning Permit) issued by the Mianzhu Planning Bureau, and the
(Building Construction Permit) issued by Mianzhu Construction Bureau for Phase 2 of the Rebuilding
Programme. However, the Mianzhu Land Bureau has not issued the land use rights for Phase 2 Land.
On 21 June 2013, Dr. Ong Hian Eng, Ong Kwee Eng, Wang Xuebo and Chia Chin Hau signed the Deed
of Indemnity, jointly and severally undertaking, inter alia, to indemnify and hold harmless our Group
against losses in connection with (i) certain land use rights which may be required in connection with
Mianzhu Norwests Mining Operations for a period of 18 months from the date of our admission to
Catalist; (ii) land use rights for Phase 2 Land; and (iii) the requisite licences, permits and approvals for
Commercial Chemical Production Operations on Phase 2 Land.
Hanwang Land
On 6 January 2013, Mianzhu Norwest entered into a contract with the Mianzhu Land Bureau for the
assignment of the state-owned commercial land use rights in respect of the Hanwang Land. Our Group
has paid consideration of approximately RMB2.6 million in respect of the land use rights for the Hanwang
Land.
Properties leased by our Group
As at the Latest Practicable Date, the following table sets out all the properties leased by our Group:
Tenant/Lessee Location Tenure
Floor
Area
(sq ft) Rental
Description
of Use
Lessor/
Sublessor
Singapore
Norwest Chemicals Unit #12-01,
Parkview Square,
600 North Bridge
Road, Singapore
188778
1 October
2012 to 30
September
2014
1,957 S$16,089.20
monthly
Ofce Chyau Fwu
Development
(Singapore)
Pte Ltd
PRC
Mianzhu Norwest Unit F, 13th
Floor, Xinshidai
Guangchang, No.
42 Wenwu Road,
Xinhua Avenue,
Chengdu City,
Sichuan Province
(1)

1 May 2013
to 30 April
2014
1,027 RMB
3,814.80
monthly
Ofce Service
Centre of
Sichuan
Commerce
Department
Note:
(1) In accordance with the relevant PRC laws, property leases shall be led with the competent property administration authority
by both the lessor and the lessee within the time limit prescribed by the competent property administration authority, failing
which, a penalty of between RMB1,000 and RMB10,000 shall be imposed. This lease has not been led with the competent
property administration authority. The Legal Advisers to our Company on PRC Law, King & Wood Mallesons, has advised that
such non-compliance will not affect the effectiveness or legal enforceability of the lease. As at the Latest Practicable Date,
there has been no ne or penalty imposed on Mianzhu Norwest for such non-ling of the lease.
110
PERMITS, LICENCES, APPROVALS AND GOVERNMENT REGULATIONS
We are subject to relevant laws and regulations for our business operations. As at the Latest Practicable
Date, our Group holds the following material permits, licences and approvals:
Licences
Licensing
Body
Date of
Issue
Date of
Expiry Description
Mine 1
Mining right Sichuan Land
Department
9 March 2011 9 December
2015
Mining area: 1.6491 sq km
Mining depth: Between the elevation of
2,570 m and 2,240 m
Approved annual production scale:
50,000 tonnes
Exploration right Sichuan Land
Department
9 April 2012 9 April 2014 Exploration area: 0.55 sq km
Mining Safety
Production Permit
Sichuan Safety
Bureau
26 September
2012
25 September
2015
Authorised scope: Phosphate mine
underground mining operations
Mine 2
Mining right Sichuan Land
Department
9 March 2011 9 January
2020
Mining area: 2.0237 sq km
Mining depth: Between the elevation of
2,420 m and 1,600 m
Approved annual production scale:
200,000 tonnes
Exploration right Sichuan Land
Department
16 June 2012 16 June 2014 Exploration area: 1.28 sq km
In order to resume Commercial Mining Operations at Mine 2, and Commercial Chemical Production
Operations, we are required to obtain certain approvals, licences, authorisations and permits in
accordance with relevant PRC laws, rules and regulations. Please refer to the sections entitled General
Information on our Group Legal Opinion from King & Wood Mallesons and General Information on our
Group PRC Government Regulations of this Offer Document for details of the further approvals to be
obtained.
To the best of our Directors knowledge, save as disclosed in the sections entitled Risk Factors, General
Information on our Group Mining Operations, General Information on our Group Properties and
Fixed Assets, General Information on our Group Permits, Licences, Approvals and Government
Regulations, General Information on our Group Legal Opinion from King & Wood Mallesons and
Interested Person Transactions and Conicts of Interest Present and On-going Interested Person
Transactions of this Offer Document, our Group has obtained all necessary approvals, licences and
permits for our current operations. As at the Latest Practicable Date, none of the aforesaid permits,
licences and approvals have been suspended, revoked or cancelled and, to the best of our Directors
knowledge and belief, we are not aware of any facts or circumstances which would cause such permits,
licences and approvals to be suspended, revoked or cancelled or any applications for, or renewal of, any
of these permits, licences and approvals to be rejected by the relevant authorities.
111
LEGAL OPINION FROM KING & WOOD MALLESONS
The Legal Advisers to our Company on PRC Law, King & Wood Mallesons, is a law rm practising in the
PRC. It has conducted a legal due diligence review on Mianzhu Norwest in connection with the Invitation.
This legal opinion has been prepared on the basis and subject to the limitations on King & Wood
Mallesons liability set out in King & Wood Mallesons terms of engagement. In such capacity, it has: (a)
reviewed (i) Mianzhu Norwests les; (ii) relevant certicates; and (iii) other documents issued by the
relevant governmental authorities of the PRC provided by Mianzhu Norwest; (b) taken into consideration
the conrmations made by the relevant PRC authorities on specic issues; and (c) conducted the
necessary checks and enquiries in the event that the documents provided by the Company appear to be
unusual.
In examining the documents in respect of Mianzhu Norwest, King & Wood Mallesons has assumed, inter
alia, that:
i. all signatures, seals and chops thereon are true and genuine, and all documents submitted to it as
copies are complete and conform to the originals;
ii. all factual statements made in such documents are accurate and complete;
iii. all documents as presented to King & Wood Mallesons are, as at the date of this Offer Document,
up to date and none of the documents have been revoked, amended, varied or supplemented;
iv. all persons executing and delivering the documents are competent and duly authorised to execute
and deliver such documents; and
v. the information provided by Mianzhu Norwest, whether or not in the form of a conrmation or
statement, is accurate, complete and true in every aspect.
Based on the foregoing, King & Wood Mallesons is of the opinion that:
1. Due Incorporation and Good Standing
a. Mianzhu Norwest was legally established and validly exists as a wholly foreign-owned
enterprise and has the status of an independent legal entity in the form of a limited
liability company, having full capacity, power and authority to enter into legally binding and
enforceable contracts and undertakings with full power to sue or to be sued in its own name.
b. Mianzhu Norwests current business scope is in compliance with and does not contravene
any PRC laws, rules or regulations.
c. Mianzhu Norwest has passed the annual inspections conducted by the Deyang AIC Bureau
for 2010, 2011 and 2012.
d. To the best of King & Wood Mallesons knowledge, as at the date of this Offer Document,
there are no provisions, irregularities, inconsistencies or other matters contained in the
records of Mianzhu Norwest which would materially and adversely affect: (i) its status as
an independent legal entity; (ii) its power and authority to own, use, lease and operate its
properties and other assets lawfully obtained (excluding in relation to Phase 1 Land which
has been mortgaged please see section 2(d) of this legal opinion); and (iii) the business
presently conducted by Mianzhu Norwest as set out in the Offer Document.

e. Norwest Chemicals is the proper, valid, legal and benecial owner of the entire equity
interest in Mianzhu Norwest.
112
2. Title to or Validity and Enforceability of the Rights to any Assets (including licences and
agreements)
Mining Operations
Mining Rights and Exploration Rights
a. Mianzhu Norwest was granted mining right certicates for Mine 1 and Mine 2 and exploration
right certicates for additional mining areas adjacent to the Mines (the exploration areas)
by the Sichuan Land Department, and such certicates are valid and subsisting as at the
date of this Offer Document. King & Wood Mallesons is of the opinion that the Sichuan Land
Department is the competent authority responsible for the renewal of the current mining and
exploration right certicates of Mianzhu Norwest. As and when such certicates are due
for renewal, Mianzhu Norwest will use its best endeavours to meet all relevant conditions
and requirements as may be required by the relevant PRC laws, rules and regulations and
all competent authorities to renew the same. Mianzhu Norwest believes that the renewal
applications are procedural in nature, and has not encountered any material difculties in
obtaining and/ or renewing such certicates in the past. In particular, Mianzhu Norwest has
conrmed that it has applied for and was granted the mining right certicates for Mine 1 and
Mine 2 since 2002; and has applied for and was granted the exploration right certicates for
Mine 1 and Mine 2 since 2008. In light of the foregoing, King & Wood Mallesons is of the
opinion that the risk of Mianzhu Norwest not being able to renew the aforesaid mining right
certicates and the exploration right certicates for Mine 1 and Mine 2 is relatively low.
Mianzhu Norwest has conrmed that in the course of its exploration activities, it may obtain
phosphate rocks from the exploration areas. These phosphate rocks can be subsequently
sold by Mianzhu Norwest. Under the relevant PRC laws, rules and regulations, without
obtaining mining right certicate(s) for the exploration areas, Mianzhu Norwest is allowed
to conduct exploration activities, but not mining activities and/ or extraction works in
the exploration areas. Mianzhu Norwest has conrmed that as at the date of this Offer
Document, to the best of its knowledge and belief, it is only conducting exploration
activities and not mining activities or extraction works in the exploration areas. Taking
into consideration the foregoing, King & Wood Mallesons is of the opinion that the sale of
phosphate rocks obtained from the exploration areas in the course of Mianzhu Norwests
exploration activities are not in breach of the relevant PRC laws, rules or regulations.
Land Occupation and Land Use Right
b. As at the date of this Offer Document, Mianzhu Norwest is conducting its Mining Operations
on forestry land of approximately 2.4564 hectares (the Current Land Occupation).
Approval from the Deyang Forestry Bureau
Prior to August 2012, Mianzhu Norwest conducted its Mining Operations on forestry land of
approximately 1.7665 hectares (the Previous Land Occupation).
In respect of the Previous Land Occupation, Mianzhu Norwest obtained the approval
from the Deyang Forestry Bureau on 9 August 2010 for a period of two (2) years and this
approval has expired at the end of July 2012 (the 2010 Forestry Bureau Approval).
In respect of the Current Land Occupation, Mianzhu Norwest successfully obtained the
approval from the Deyang Forestry Bureau on 24 August 2012 for another period of two
(2) years and this approval will expire by the end of July 2014 (the 2012 Forestry Bureau
Approval).
113
Conrmation from the Mianzhu Land Bureau
Previous Land Occupation
For the Previous Land Occupation, on 16 February 2012, representatives of Mianzhu
Norwest and King & Wood Mallesons visited Mianzhu Land Bureau and in the meeting, the
(Head of Mianzhu Land Bureau) (the Head of Land Bureau) verbally conrmed that
the Mianzhu Land Bureau does not issue land use rights certicate for the Previous Land
Occupation. Subsequent to this meeting, the Mianzhu Land Bureau issued a conrmation
letter (the Mianzhu Land Bureau Conrmation Letter) stating that, inter alia: (i) Mianzhu
Norwest has since its incorporation been lawfully in compliance with all PRC state and
local land laws and regulations; (ii) Mianzhu Norwest has not been found of any actions in
violation of any relevant land administration laws, rules and regulations; and (iii) Mianzhu
Norwest has also not been imposed with any statutory or regulatory penalties in respect of
land nor has it been involved in any legal dispute with the Mianzhu Land Bureau in relation
to any land matters.

Current Land Occupation
For the Current Land Occupation, as at the date of this Offer Document and to the best of its
knowledge and belief, Mianzhu Norwest has conrmed that:
(i) based on the Mianzhu Land Bureau Conrmation Letter, it is in compliance with and
has not breached any PRC laws, rules and regulations, including without limitation,
those of the PRC state and local government, or arrangements with any third parties
and since receipt of the Mianzhu Land Bureau Conrmation Letter, it has been in
compliance with and has not breached any PRC laws, rules and regulations, including
without limitation, those of the PRC state and local government, or arrangements with
any third parties;
(ii) it has not been provided with any notice of statutory or regulatory breaches, penalties
or nes from the relevant authorities or other third parties;
(iii) it has not been imposed with any statutory and regulatory penalties or nes from the
relevant authorities or other third parties; and
(iv) it has not been involved in any legal dispute with the relevant authorities or other third
parties.
Taking into consideration the foregoing, King & Wood Mallesons is of the opinion that, as at
the date of this Offer Document:
(aa) Deyang Forestry Bureau is the relevant and competent authority to issue the 2010
Forestry Bureau Approval and the 2012 Forestry Bureau Approval regarding the
Previous Land Occupation and Current Land Occupation, respectively (collectively, the
Land Occupation);
(bb) Mianzhu Land Bureau is the relevant and competent authority in respect of the Land
Occupation and has the right to issue the Mianzhu Land Bureau Conrmation Letter;
(cc) (in respect of the Previous Land Occupation) (i) Mianzhu Norwest has obtained
the relevant approvals and conrmation from the Deyang Forestry Bureau and the
Mianzhu Land Bureau (collectively, the Competent Authorities); (ii) Mianzhu
Norwest is in compliance with all the legal and regulatory requirements of the
Competent Authorities, and all relevant PRC state and local land laws, rules and
regulations as conrmed by the Competent Authorities; and (iii) there are no other
PRC authorities, save for the Competent Authorities, from which Mianzhu Norwest
requires any such approvals, licences, permits and authorisations;
114
(dd) Mianzhu Norwest has conrmed that since 2002, Mianzhu Norwest has obtained the
necessary approvals for its temporary occupation of the forestry land from the Deyang
Forestry Bureau. Mianzhu Norwest has not encountered any material difculties
in obtaining such approvals in the past, and will use its best endeavours to meet all
relevant conditions and requirements as may be required by the relevant PRC laws,
rules and regulations and all competent authorities in order to renew or obtain such
approvals in the future. Therefore, notwithstanding the (Regulations
for the Implementation of Forestry Law), which states that the period of temporary
occupation of forestry land shall not exceed two (2) years, King & Wood Mallesons
is of the opinion that the risk of Mianzhu Norwest not being able to renew or obtain
the necessary approvals (from the Deyang Forestry Bureau) for the Current Land
Occupation is relatively low;

(ee) based on the documents provided by Mianzhu Norwest, as of the date of this Offer
Document and to the best of its knowledge, King & Wood Mallesons has found that
Mianzhu Norwest :
i. has not been provided with any notice of statutory or regulatory breaches,
penalties or nes from the relevant authorities, including the Mianzhu Land
Bureau, or other third parties;
ii. has not been imposed any statutory and regulatory penalties or nes from the
relevant authorities, including the Mianzhu Land Bureau, or other third parties;
and
iii. has not been involved in any legal dispute with the relevant authorities, including
the Mianzhu Land Bureau, or other third parties,
in respect of the Current Land Occupation; and
(ff) based on the reasonable enquiries made by King & Wood Mallesons, as of the date of
this Offer Document and to the best of its knowledge, King & Wood Mallesons has not
found that any statutory and regulatory penalties or nes were imposed on Mianzhu
Norwest by either the Mianzhu Land Bureau or the Deyang Forestry Bureau in respect
of the Current Land Occupation.
To further clarify whether the Mianzhu Land Bureau issues land use rights certicates
for the land occupied by other mines situated in the vicinity of the Mines, King & Wood
Mallesons contacted the Head of Land Bureau, via telephone on 4 July 2013. The Head
of Land Bureau did not disclose whether the Mianzhu Land Bureau had issued land use
rights certicates for the land occupied by other mines situated in the vicinity of the Mines.
However, the Head of Land Bureau did verbally conrm that a company conducting mining
operations on the (Deyang Fa Mu Chang forestry land) (the Fa Mu
Chang Forestry Land), shall apply for approval from the competent forestry bureau, and
that the Mianzhu Land Bureau does not issue land use rights certicates for such forestry
land. The Mines are located on the Fa Mu Chang Forestry Land.
Taking the above-mentioned into consideration, to the best of its knowledge, King & Wood
Mallesons is of the opinion that:
(i) the Mianzhu Land Bureau does not issue land use rights certicates for the Land
Occupation;
(ii) there is a low possibility that Mianzhu Land Bureau issued land use rights certicates
for the forestry land occupied by other mines situated in the Fa Mu Chang Forestry
Land where the Mines are located; and
115
(iii) as at the date of this Offer Document, there is a relatively low possibility that, in
respect of the Land Occupation, Mianzhu Land Bureau will change its position from
that set out in the Mianzhu Land Bureau Conrmation Letter.
Co-operation Arrangement with Dashan
c. Under the Dashan Arrangement, depending on the level of investment contributed by each
party, the prots or losses (after deducting applicable costs and taxes) from the sales of the
phosphate rocks obtained from the relevant adits shall be apportioned between Mianzhu
Norwest and Dashan on a 50:50 or a 20:80 basis.
Under the Dashan Arrangement, Mianzhu Norwest shall be responsible for the unied
management, design, sales, employment and purchase of social security in respect of the
mineral resource of the co-operative zones. Furthermore the Dashan Arrangement does not
contain any provisions stating that the excavated phosphate rocks shall belong to Dashan,
and do not provide for the transfer of Mianzhu Norwests assets or its relevant mining or
exploration rights, permits or certicates to any party.
Mianzhu Norwest has confirmed that the Dashan Arrangement does not incur the
separation of ownership and operational control of the Mines, and during the performance
of the Dashan Co-operation Agreements, (i) Mianzhu Norwest is mainly responsible for the
operation as well as the management of the Mines and Dashan is mainly be responsible
for providing support such as technology, personnel and equipment; (ii) the ownership
right of the phosphate rocks excavated belongs to Mianzhu Norwest and the aforesaid
phosphate rocks shall be taken and sold by Mianzhu Norwest; and (iii) there are no oral or
written contracts regarding the transfer of Mianzhu Norwests assets or its relevant mining or
exploration right permits and certicates to any party.
Based on King & Wood Mallesons review of the Dashan Co-operation Agreements, there
are some provisions which directly refer to Dashan conducting certain mining activities in the
Mines (the Mining Provisions). Mianzhu Norwest has conrmed that it has no intention to
separate the ownership and operation control of the Mines via the Mining Provisions, and
Mianzhu Norwest will not enter into any further arrangement, whether pursuant to the Mining
Provisions or otherwise, with Dashan in respect of the mining and exploration activities in
the Mines which, to the best of Mianzhu Norwests knowledge, information and belief, will
contravene applicable PRC laws, rules, regulations and requirements.
In light of the foregoing, King & Wood Mallesons is of the opinion that there is a relatively
low risk that (i) the co-operation between Mianzhu Norwest and Dashan is in contravention
of PRC laws, rules and regulations with regards to the disposal of mining rights, where
transferring the possession of mining rights via contracting out is explicitly forbidden; or (ii)
any penalties will be imposed on Mianzhu Norwest, or the mining rights of Mianzhu Norwest
in respect of the Mines will be revoked, as a result of such contravention.
In addition, the Dashan Co-operation Agreements provide, inter alia, if the enterprise nature
of Mianzhu Norwest is changed due to reform or other reasons, Mianzhu Norwest shall
ensure (i) the preferential rights of Dashan to participate in its reform or reorganisation (the
Preferential Rights Clause); or (ii) the rights and obligations of Dashan under the Dashan
Co-operation Agreements remain unchanged.
Mianzhu Norwest has conrmed that save for the change in group structure arising from the
Restructuring Exercise and the change in shareholdings arising from the proposed Invitation,
the business and operations of Mianzhu Norwest remains unchanged and it intends to
continue co-operating with Dashan in compliance with the terms of the Dashan Co-operation
Agreements. Therefore, the rights and obligations of Dashan under the Dashan Co-operation
Agreements remain unchanged even after the Invitation. Mianzhu Norwest has further
116
conrmed that Dashan has been notied of the proposed listing of the Company and that the
arrangements under the Dashan Co-operation Agreements will continue, and Dashan has
responded by verbally conrming that the listing of the Company does not affect Dashans
rights and obligations under the Dashan Co-operation Agreements.
Based on the foregoing, King & Wood Mallesons is of the opinion that so long as Mianzhu
Norwest ensures that the rights and obligations of Dashan under the Dashan Co-operation
Agreements remain unchanged, the Invitation will not trigger the Preferential Rights Clause
in the Dashan Co-operation Agreements.
Based on its review of the Dashan Co-operation Agreements, King & Wood Mallesons is of
the opinion that the provisions of the Dashan Co-operation Agreements will not affect the
legal rights of Mianzhu Norwest to carry out its current business operations.
The Dashan Co-operation Agreements for Mine 1 will expire and terminate on: (i) the
exhaustion of the mineral resources in the agreed mining areas; or (ii) the issuance of a
stop order by the relevant government authorities. The Dashan Co-operation Agreements for
Mine 2 will expire and terminate on the later of: (i) the expiry of the mining permits relating to
the agreed mining areas; or (ii) the exhaustion of phosphorus rock resources in the agreed
mining cooperation areas.
Land Use Rights
d. Mianzhu Norwest has been granted the (land use rights certicate) for
Phase 1 Land. The land use rights for Phase 1 Land is subject to a mortgage in favour of the
Bank of China Limited, Mianzhu Branch (the BOC Mortgage) in respect of a term loan of
RMB5 million from 5 February 2013 to 5 February 2018 (the BOC Loan).
Based on the documents provided, and as conrmed by Mianzhu Norwest, save for the
aforesaid BOC Mortgage, there is no other encumbrance on Mianzhu Norwests land use
rights for Phase 1 Land. Mianzhu Norwest is entitled to use and occupy Phase 1 Land and
transfer, lease and mortgage the corresponding land use rights in accordance with the PRC
laws and regulations within the valid term of such land use rights certicate.
e. As at the date of this Offer Document, Mianzhu Norwest has not obtained the
(land use rights certicate) for Phase 2 Land.
Construction Permits and Building Ownership
f. Mianzhu Norwest completed the construction of the P
4
Plant at the New Gongxing Site under
Phase 1 of the Rebuilding Programme at the end of 2012.
For the construction of the P
4
Plant under Phase 1 of the Rebuilding Programme, Mianzhu
Norwest has obtained, inter alia, the (project approval), the
(environmental impact approval), the (safety examination approval), the
(lightning device design approval), the
(construction site selected and earthquake resistance opinion letter), the
(construction project re protection design approval letter), the
(construction land planning permit), the (construction project
planning permit), the (building construction permit), the
(environmental trial production approval) and the (record of safety
trial production plan).
117
In addition to the said permits, Mianzhu Norwest shall obtain other necessary permits and
approvals in order to obtain legal completion for Phase 1 of the Rebuilding Programme,
mainly and materially, the (acceptance of environmental protection), the
(approval of preliminary evaluation of the harm of occupational
diseases), the (occupational diseases protection facilities
design examination approval), the (approval of evaluation of
occupational diseases control effect), the (acceptance of occupational
diseases protection facilities), the (safety examination approval), the
(acceptance of re control), the (acceptance of completed project)
and the (building ownership rights certicate) (the Phase 1 Completion
Approvals).
As at the date of this Offer Document, Mianzhu Norwest is in the process of applying for
the Phase 1 Completion Approvals. Mianzhu Norwest believes that the applications for
the Phase 1 Completion Approvals are procedural in nature, and expects to receive such
approvals in due course upon completion of the necessary application procedures. Mianzhu
Norwest has indicated and conrmed that it has not encountered any material difculties in
obtaining such approvals in the past in respect of its Previous Hanwang Facilities. Mianzhu
Norwest conrms that it will use its best endeavours to meet all relevant conditions and
requirements as may be required by the relevant PRC laws, rules and regulations and all
competent authorities in order to renew or obtain the Phase 1 Completion Approvals.
In light of the foregoing, King & Wood Mallesons is of the opinion that the risk of Mianzhu
Norwest not being able to obtain the Phase 1 Completion Approvals is relatively low.
g. Mianzhu Norwest has built temporary buildings on Phase 2 Land and the STPP equipment,
machinery and storage facilities are currently located in these temporary buildings.
In order to carry out and complete the construction on Phase 2 Land, Mianzhu Norwest
shall obtain the necessary permits, licences or approvals, materially and mainly the
(land use rights certicate), the (safety examination approval), the
(environmental trial production approval), the (record of
safety trial production plan), the (acceptance of environmental protection), the
(approval of preliminary evaluation of the harm of occupational
diseases), the (occupational diseases protection facilities
design examination approval), the (approval of evaluation of
occupational diseases control effect), the (acceptance of occupational
diseases protection facilities), the (safety examination approval), the
(acceptance of completed project) and the (building ownership rights
certicate).
According to the relevant PRC laws, rules or regulations, a company shall not occupy or
use land or construct any buildings on it without proper approvals and/ or permits from the
competent authorities. Since Mianzhu Norwest has not received all the approvals and/ or
permits for Phase 2 Land and the temporary buildings on it, the relevant authority shall have
the right to (i) order Mianzhu Norwest to return the Phase 2 Land; (ii) order Mianzhu Norwest
to demolish any buildings or installations on Phase 2 Land within a certain time limit and
conduct restoration; and/ or (iii) conscate the structures and installations built on such land
and impose penalties on Mianzhu Norwest.
Leases
h. Mianzhu Norwest has leased Unit F, 13th Floor, Xinshidai Guangchang, No. 42 Wenwu
Road, Xinhua Avenue, Chengdu City, Sichuan Province for the duration of 1 May 2013 to 30
April 2014 for use as ofce premises. In accordance with the relevant PRC laws, property
leases shall be led by both the lessor and the lessee within the time limit prescribed by the
competent property administration authority, failing which, a penalty of between RMB1,000
and RMB10,000 shall be imposed. This lease has not been led with the competent property
administration authority. Such non-compliance will not affect the effectiveness or legal
enforceability of the lease.
118
3. Compliance with Laws, Approvals and Licences
General
a. As a result of changes in the PRCs foreign investment policy, the classication of foreign
investment in phosphate mines was changed from the encouraged category to the
restricted category in 2007. As such, the incorporation and changes of a foreign invested
enterprise involved in restricted industries shall be governed by the commerce bureau/
departments of a provincial or higher level.
However, Mianzhu Norwest was incorporated in 1996. Since incorporation, all changes to
Mianzhu Norwest were approved by the Deyang Commerce Bureau. To clarify the impact
of the Revised Catalogue to our Group, King & Wood Mallesons, together with Mianzhu
Norwest, visited the Deyang Commerce Bureau. During this visit, the (section chief) in
charge of Mianzhu Norwest has verbally conrmed that Deyang Commerce Bureau is the
competent authority to approve any changes to Mianzhu Norwest.
Mining Operations
Mining Rights and Exploration Rights
b. Please refer to the opinion under section 2(a) above.
Land Occupation and Land Use Right
c. Please refer to the opinion under section 2(b) above.
Mining Safety Production Permits
d. As at the Latest Practicable Date, Mianzhu Norwest is carrying out Commercial Mining
Operations for Mine 1, which is permitted based on the Commercial Mining Notication. The
Mining Safety Production Permit for Mine 1 was renewed on 26 September 2012 and is valid
until 25 September 2015.
In respect of Mine 2, Mianzhu Norwest is carrying out Trial Mining Operations, which is
permitted based on the Trial Mining Notications.
As part of the measures by the relevant PRC authorities to assist mining companies in
Mianzhu City, Sichuan Province affected by the Wenchuan Earthquake, mining companies
such as Mianzhu Norwest have been granted certain exemptions and deferments in respect
of the renewal of the Mining Safety Production Permits. As such, Mianzhu Norwest is
permitted to defer renewal of its Mining Safety Production Permits.
As at the date of this Offer Document, Mianzhu Norwest has submitted its application for the
Mining Safety Production Permit for Mine 2. Mianzhu Norwest believes that the application
for the Mining Safety Production Permit for Mine 2 is procedural in nature, and expects to
receive this permit in due course upon completion of the necessary application procedures.
Mianzhu Norwest has indicated and conrmed that it has not encountered any material
difculties in obtaining this permit for Mine 2 in the past (prior to the Wenchuan Earthquake).
Mianzhu Norwest conrms that it will use its best endeavours to meet all relevant conditions
and requirements as may be required by the relevant PRC laws, rules and regulations and
all competent authorities in order to renew or obtain Mining Safety Production Permit for
Mine 2. Mianzhu Norwest will be able to carry out Commercial Mining Operations for Mine 2
after it receives the Mining Safety Production Permit for Mine 2.
Norwest not being able to obtain the Mining Safety Production Permit for Mine 2 is relatively
low.
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Past Excess Production
e. Mianzhu Norwest exceeded the approved production scale for Mine 1 for FY2005, FY2006
and FY2007.
The relevant competent land and resources department has the right to require a mining
company to suspend its operations and rectify the non-compliance within a certain period
of time if, inter alia, the mining company does not carry out its operations according to its
approved development and utilisation plan for its mines.
However, Mianzhu Norwest renewed the mining right certicates for the Mines in 2011 and
Mianzhu Norwest obtained the requisite approvals from the Sichuan Land Department to
increase the approved production scales for the Mines in 2005 (and thereafter in 2010 in
respect of Mine 2 only). In addition, Mianzhu Norwest has conrmed that it has duly paid
all applicable resource taxes to Mianzhu State Tax Bureau and Mianzhu Local Tax Bureau
including in respect of the excess production. As of the Latest Practicable Date, Mianzhu
Norwest has conrmed that it has not received any penalties from any competent authorities
in respect of the excess production, or any orders or notications by any competent
authorities to carry out any rectication work, or any notices of suspensions in respect of its
Mining Operations.
Taking into consideration the foregoing, King & Wood Mallesons is of the opinion that there
is a relatively low risk that the Sichuan Land Department will impose any penalties or revoke
the mining right certicate for Mine 1 due to the excess production.
Land Use Right
f. Please refer to the opinion under section 2(d) and section 2(e) above.
Construction Permits and Building Ownership
g. Please refer to the opinion under section 2(f) and section 2(g) above.
Phase 1 Chemical Production Approvals
h. For the Chemical Production Operations of Phase 1 of the Rebuilding Programme, Mianzhu
Norwest has obtained the approvals for trial chemical production operations, including the
(environmental trial production approval) and the record of the
(record of safety trial production plan) at the date of this Offer Document and will
need to apply for the necessary approvals for commercial chemical production operations
(the Phase 1 Commercial Chemical Production Approvals) (collectively, the Phase 1
Chemical Production Approvals).
For Commercial Chemical Production Operations, the main Phase 1 Commercial Chemical
Production Approvals include, inter alia, the Chemical Safety Production Permits, the
Pollution Discharge Permit), the (hazardous chemicals business
licence), the (hazardous chemicals registration certicate), the
(licence for the manufacturing of industrial products), the
(environmental management registration licence for the production and use of
dangerous chemicals) and the (building ownership rights certicate).
As at the date of this Offer Document, Mianzhu Norwest is in the process of applying for
the Phase 1 Commercial Chemical Production Approvals. Mianzhu Norwest believes that
the applications are procedural in nature, and expects to receive the Phase 1 Commercial
Chemical Production Approvals in due course upon completion of the necessary application
procedures. Mianzhu Norwest has not encountered any material difculties in obtaining such
approvals in the past, and has indicated and conrmed that it had applied for and obtained
120
the aforesaid approvals for its Previous Hanwang Facilities. Mianzhu Norwest conrms that
it will use its best endeavours to meet all relevant conditions and requirements as may be
required by the relevant PRC laws, rules and regulations and all competent authorities in
order to renew or obtain the Phase 1 Commercial Production Approvals.
Norwest not being able to obtain the Phase 1 Commercial Chemical Production Approvals is
relatively low.
i. Mianzhu Norwest produced minimal quantities of thermal phosphoric acid, SHMP and STPP
in FY2009, FY2010 and FY2011 at the Previous Hanwang Facilities which discharged
certain pollutants. Under PRC laws, rules and regulations, companies which discharge
pollutants are required to obtain a Pollution Discharge Permit which is subject to annual
inspection. Therefore, Mianzhu Norwest is required to have a Pollution Discharge Permit for
its Chemical Production Operations.
Mianzhu Norwests Pollution Discharge Permit expired in January 2008. However, it has
received a conrmation letter dated 18 January 2012 from the Mianzhu Environmental
Bureau stating, inter alia, that:
(a) the mining and the other production and operation activities of Mianzhu Norwest are in
compliance with relevant PRC environmental laws, rules and regulations; and
(b) since its incorporation, Mianzhu Norwest:
(i) has obtained all necessary licences for its mining and the other production and
operation activities as required under the relevant PRC environmental laws,
rules and regulations, and has fully and timely paid the pollutant discharge fee;
and
(ii) is in compliance with relevant PRC environmental laws, rules and regulations
and has not been penalised for environmental matters.
Mianzhu Norwest expects the Pollution Discharge Permit to be issued or renewed in 2013.
Conclusion
j. Save as disclosed above and in this Offer Document, to the best of its knowledge, King
& Wood Mallesons is of the opinion that Mianzhu Norwest has obtained all requisite
approvals, licences, permits and authorisations that would materially affect its exploration
activities, Mining Operations and Chemical Production Operations and Mianzhu Norwest is
in compliance with the relevant PRC laws, rules and regulations and/ or requirements from
the competent authorities, and where applicable, has complied with the conditions imposed
thereunder.
4. Litigation
a. Based on the conrmation by Mianzhu Norwest, as at the date of this Offer Document,
Mianzhu Norwest is not engaged in any legal or arbitration proceedings, including those
which are pending or known to be contemplated, which may have, or which have had, in the
12 months immediately preceding the date of lodgment of the Offer Document, a material
effect on its nancial position or protability. As at the date of this Offer Document, based
on the search results from the (National Courts Searching
System for Pending Judgment Debts) (the Pending Judgment Debts System), cases
involving Mianzhu Norwest as the (judgement debtor) have been concluded. Based
on Mianzhu Norwests conrmation, Mianzhu Norwest has fully discharged all payment
obligations due to judgment creditors for such cases. To the best of King & Wood Mallesons
knowledge, there is no other publicly available system for nation-wide litigation searches in
the PRC other than the Pending Judgment Debts System.
121
5. Share Capital of Mianzhu Norwest
a. Details of the present shareholder, registered capital and paid-up capital of Mianzhu Norwest
are as follows:
Name of Shareholder : Norwest Chemicals
Shareholding : 100%
Registered Capital : RMB140 million
Paid-up Capital : RMB140 million
b. All transfers of equity interest in Mianzhu Norwest have been approved by the Deyang
Commerce Bureau. Certain transfers of equity interest in Mianzhu Norwest in the past
have not been registered/ led with the Deyang AIC Bureau (the Non-Registration), and
such Non-Registration will incur certain penalties under the relevant PRC laws, rules and
regulations.
According to Article 29 of the (PRC Administrative Penalty Law),
if an illegal act is not discovered within two (2) years of its commission (the Limitation
Period), an administrative penalty shall not be imposed, except as otherwise prescribed by
law. King & Wood Mallesons has advised that, in practice, the relevant PRC authorities have
in some cases imposed administrative penalties after the Limitation Period.
Taking into consideration the foregoing, King & Wood Mallesons is of the opinion that there
is a relatively low risk that the Deyang AIC Bureau will impose any penalties on Mianzhu
Norwest for the Non-Registration. Notwithstanding the Non-Registration, Norwest Chemicals
was registered with Deyang AIC Bureau as the sole owner of Mianzhu Norwest on 4 April
2003, and accordingly the Non-Registration will not affect Norwest Chemicals status as the
proper, valid, legal and benecial owner of the entire equity interest in Mianzhu Norwest.
6. Legal Representative and Supervisor of Mianzhu Norwest
Legal Representative
a. Our CEO and Executive Director, Dr. Ong Hian Eng, is the Legal Representative of Mianzhu
Norwest.
King & Wood Mallesons has advised that Dr. Ong Hian Eng, being the Legal Representative
of Mianzhu Norwest, has the following powers in accordance with PRC law:
(i) to act as the representative of Mianzhu Norwest; and
(ii) to execute contracts on behalf of Mianzhu Norwest.
Supervisor
b. Toh Thiam Seah Victor is the (Supervisor) of Mianzhu Norwest. King & Wood Mallesons
has advised that under PRC law, the Supervisor of a company plays a non-executive role
and shall report to the shareholders of Mianzhu Norwest, namely, Norwest Chemicals.
Toh Thiam Seah Victor, being the Supervisor of Mianzhu Norwest, has the following major
responsibilities in accordance with PRC law:
(i) to monitor the acts of Mianzhu Norwests directors and ofcers;
(ii) to review the nancial affairs of Mianzhu Norwest;
(iii) to convene interim meetings of the shareholders; and
(iv) to exercise other powers prescribed by the articles of association.
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PRC GOVERNMENT REGULATIONS
Our Mining Operations and our Chemical Production Operations in the PRC are governed by various
laws and regulations and subject to various licences, permits and governmental approvals. Below is a
summary of laws and regulations which have a material impact on our Groups business or operations:
PRC Laws relating to the Mineral Industry
According to the (Mineral Resources Law of the PRC) promulgated on 19
March 1986, effective as of 1 October 1986 and amended on 29 August 1996 and 27 August 2009, and
the (Rules for the Implementation of the Mineral Resources Law)
promulgated on and effective as of 26 March 1994, an enterprise that intends to explore and exploit
mineral resources shall apply for each exploration and mining rights separately according to the relevant
PRC laws, regulations and policies, and is required to undergo the registration process to obtain
licence(s) of exploration right and/ or mining right, unless the mining enterprise which intends to conduct
exploration operations for its own production within the dened mining areas has previously obtained
mining rights.
The (Procedures for Administration of Registration of Mining of Mineral
Resources) (the State Council Circular No. 241) was promulgated by the State Council and became
effective as of 12 February 1998. Under the State Council Circular No. 241, anyone licensed with mining
rights may le an alteration application to the relevant authorities within the term of validity of the mining
rights for such changes as those in the scope of the mining area, the main mineral categories to be
exploited, the exploitation mode, the name of the mining enterprise and/ or the transfer of the mining right
according to the relevant laws. If the holder of a mining right intends to continue with mining, it shall apply
for an extension with the relevant authority at least 30 days prior to the expiration of the mining right. If
the holder of a mining right fails to apply for an extension at least 30 days prior to the expiration of the
mining right, the permit will terminate automatically.
The (Measures for the Area Registration Administration of Mineral
Resources Exploration and Survey) (the State Council Circular No. 240) was promulgated by the
State Council and became effective as of 12 February 1998. Under the State Council Circular No. 240,
in case of necessity for an extension of the duration for the exploration and survey work, the holder of
the licence(s) of exploration right should, 30 days prior to the expiration of the validity of the exploration
and survey permit, go through the formalities of registration for extension with the relevant authorities.
The duration of each extension shall not exceed two (2) years. Any holder of exploration right who fails
to go through the formalities of registration for extension on expiry, the exploration and survey permit will
terminate automatically.
According to the (Tentative Provisions on the Grant and Assignment of
Mineral Rights) (the Tentative Provisions) promulgated on and effective as of 1 November 2000, a
holder of the exploration and mining rights (the mineral rights) has the right to possess, use, benet
from and dispose of its mineral right in accordance with laws. A mineral right holder may lawfully
assign its mineral right in accordance with the Tentative Provisions through sale, capital contribution,
co-operative exploration or mining or share listing. The parties to the assignment shall complete the
procedure for the change of registration of the mineral right with the original registration and licensing
authority. A mineral right holder may also lease or mortgage its mineral right in accordance with the
Tentative Provisions.
According to the (Administrative Measures for the Assignment of Mining
Rights and Exploration Rights) promulgated on and effective as of 12 February 1998, the assignment of
mineral rights shall satisfy relevant essential requirements, and a holder of the mineral rights shall apply
for the assignment of mineral rights with the relevant authority.
123
PRC Laws relating to Production Safety
According to the (Production Safety Law of the PRC) promulgated on 29 June
2002, effective as of 1 November 2002 and amended on 27 August 2009, the
(Law of the PRC on Safety in Mines) promulgated on 7 November 1992, effective as of 1 May 1993 and
amended on 27 August 2009 and the (related implementation rules)
promulgated and effective as of 30 October 1996, (i) safety facilities in mine construction projects shall
be designed, constructed and put into operation at the same time as the commencement of the principal
parts of the projects; (ii) the design of a mine shall comply with the safety rules and technological
standards of the mining industry and shall be approved by the relevant authorities; and (iii) such mines
may start production or operations only after they have passed the safety check and approval process as
required by the relevant PRC laws and administrative regulations.
According to the (Regulation on Work Safety Licences) promulgated and effective
as of 13 January 2004 (as amended on 18 July 2013) and the
(Measures for the Implementation of Work Safety Licences for Non-coal Mine Enterprises) promulgated
and effective as of 8 June 2009, (i) the work safety licensing system is applicable to any enterprise
engaging in non-coal mining and such enterprise may not produce any products without obtaining a work
safety licence; (ii) prior to producing any products, the non-coal mining enterprise shall apply for a work
safety licence, which is valid for three years; (iii) the work safety bureau at or above provincial level are
in charge of issuing the work safety licence for non-coal mining enterprise, which may authorise the work
safety bureau at municipality level with districts to issue the same; and (iv) if a work safety licence needs
to be extended, the enterprise shall apply for an extension with the administrative authority who issued
the original licence three (3) months prior to the expiration of the original licence.
PRC Laws relating to Forestry Land
According to the (Forest Law of the PRC) promulgated on 20 September 1984,
effective as of 1 January 1985 and amended on 29 April 1998 and 27 August 2009, and the
(implementation rules), prospecting, mining and various construction projects
shall not occupy forestry land, or shall occupy as little as possible of such forestry land. In the case of
necessary occupation or expropriation of forestry land, such projects shall apply for examination by,
and the approval of, the competent forestry authorities under the relevant peoples government above
the county level. The entity using the land shall pay the forest vegetation recovery fees in line with the
relevant provisions of the State Council. The term for temporary occupation of forestry land shall not
exceed two (2) years, and no permanent building may be built on such temporarily occupied forestry land;
the entity using the land must restore its condition for forestry production when the term of occupation
expires.
PRC Laws relating to Land
According to the (Land Administration Law of the PRC) promulgated on 25
June 1986, effective as of 1 January 1987 and amended on 29 December 1998 and 28 August 2004, an
entity shall obtain land use rights for construction projects. Land collectively owned by rural residents is
contracted to and operated by the members of respective collective economic entities for uses such as
plantation, forestry, livestock husbandry or shery production. The land use rights of collectively owned
land shall not be granted, assigned or leased to any party for any non-agricultural uses. In the case of
temporary use of state-owned land or land collectively-owned by farmers for construction projects or
by geological survey teams, approval shall be obtained from the land administrative department of the
government at or above the county level. Land users shall sign contracts with relevant land administrative
department or rural economic collective organisations or village committees for the temporary use of
land, depending on the ownership of land and shall pay land compensation fees as stipulated in the
contracts for the temporary use of land. The term for the temporary use of land shall generally not exceed
two (2) years.
PRC Laws relating to Construction
According to the (Construction Law of the PRC) promulgated on 1 November
1997, effective as of 1 March 1998 and amended on 22 April 2011, before the start of construction
projects, construction entities shall apply to the competent construction administrative departments for
construction licences.
124
PRC Laws relating to Planning
According to the (Urban and Rural Planning Law of the PRC) promulgated
on 28 October 2007 and effective as of 1 January 2008, if the right to use state-owned land for a
construction project is obtained by way of assignment, the construction entity shall, after concluding
the contract for assignment of the right to use state-owned land, obtain the construction land planning
permit from the competent department of urban and rural planning. In order to build any structure, xture,
road, pipeline or other engineering project within a city or town planning area, the construction entity or
individual shall apply to the competent department of urban and rural planning for the construction project
planning permit.
PRC Laws relating to Geological Environment Protection
According to the (Provisions on the Protection of the Geologic Environment of
Mines) promulgated on 2 March 2009 and effective as of 1 May 2009, (i) when an applicant for mining
rights applies for the mining right, the applicant shall prepare a plan for the protection and restoration of
the mines geological environment and submit such plan to the competent land and resources authority
for approval; (ii) when a mines geological environment is destroyed due to mineral mining, the holder of
a mining right shall be responsible for restoration of the environment to its condition prior to any mining
operations and the cost of such restoration is included in the production cost; and (iii) the holder of a
mining right shall pay a security deposit for the restoration of the geological environment of mines. The
standard and measures for the payment of the security deposit for the restoration of the geological
environment of mines are implemented in compliance with relevant provisions formulated by each
province, autonomous region or municipality.
PRC Laws relating to Land Rehabilitation
According to the (Rules on the Land Rehabilitation) promulgated on and effective as
of 5 March 2011, the operation and construction entity or individual shall be responsible for the land
rehabilitation pursuant to the principle of who destroys, who rehabilitates. The land rehabilitation
obligator shall submit the land rehabilitation plan together with other required documents when
conducting the mining rights application procedure. The relevant land and resources bureau shall not
issue the mining rights certicate if the land rehabilitation obligator did not draft the land rehabilitation
plan, or the rehabilitation plan is not in compliance with the relevant requirements.
PRC Laws relating to Environmental Protection
According to the (Environmental Protection Law of the PRC) (the
Environmental Protection Law) promulgated on and effective as of 26 December 1989, the State
Administration for Environmental Protection shall establish the national standards for environment quality.
The various governments of the provinces, autonomous regions and municipalities under the Central
Government may establish their own local standards of environment protection in areas not specied in
the national standards for environment protection and shall le a record with the State Administration for
Environmental Protection.
The Environmental Protection Law requires all enterprises dealing in industries that cause environmental
pollution and other public hazards to incorporate environmental protection into their plans and establish
a system for environmental protection. These enterprises shall adopt effective measures to prevent and
control the pollution and harms caused to the environment by waste gas, waste water, waste residues,
dust, malodorous gases, radioactive substances, noise, vibration and electromagnetic radiation generated
in the course of production, construction or other activities.
The Environmental Protection Law requires that all installations for the prevention and control of pollution
at a construction project be designed, built and commissioned together with the principal part of the
project. No permission shall be given for a construction project to be commissioned or used, until its
installations for the prevention and control of pollution are examined and considered up to standard by
the competent department of environmental protection administration.
125
According to the (Ordinance of Environmental Protection Administration for
the Construction Project) promulgated on and effective as of 29 November 1998, the
(Law of the PRC on Appraising of Environment Impacts) promulgated on 28 October 2002
and effective as of 1 September 2003 and the (Provisions on
Hierarchical Approval of the Appraising of Environment Impacts for the Construction Project) promulgated
on 16 January 2009 and effective as of 1 March 2009, the PRC government has set up a system to
evaluate the environmental impact of a construction project. Construction enterprises shall submit the
documents relating to the environmental impact of their projects to the competent environmental
authorities for approval. Construction cannot be commenced without the approvals of competent
environmental authorities.
According to the (Law of the PRC on Prevention and Control of Water
Pollution) (promulgated on 11 May 1984, amended on 15 May 1996 and 28 February 2008 and effective
as of 1 June 2008) any new construction, reconstruction or expansion projects, and other installations
that directly or indirectly discharge pollutants into the water shall be subject to the state regulations on
environmental protection of construction projects. Enterprises and institutions that discharge pollutants
directly or indirectly into a water body shall report to and register with the local environmental protection
department of their existing facilities for discharging and treating pollutants, and the categories, quantities
and concentrations of pollutants discharged under their normal operation conditions, and also submit
to the same department technical information concerning prevention and control of water pollution. It
is necessary to obtain the pollutant discharge permit for directly or indirectly discharging pollutants into
the water. Enterprises and institutions that discharge pollutants into a water body shall pay a pollutant
discharge fee. If the discharge exceeds the limits set by the national or local standards, they shall pay a
fee for excess discharge according to State regulations.
According to the (Law of the PRC on Prevention and Control of
Atmospheric Pollution) promulgated on 5 September 1987, amended on 29 August 1995 and 29
April 2000 and effective as of 1 September 2000, any new construction, reconstruction or expansion
projects, that discharge pollutants into the air shall be subject to the state regulations on environmental
protection of construction projects. Enterprises that discharge atmospheric pollutants shall report to the
local administrative department of environmental protection of their existing discharge and treatment
facilities for pollutants and the categories, quantities and concentrations of pollutants discharged under
normal operation conditions and submit to the same department their technical information concerning
prevention and control of atmospheric pollution.
The PRC implements a system of fees collection for discharging pollutants on the basis of the categories
and quantities of the atmospheric pollutants discharged, and establishing reasonable standards for
collection of fees. This is necessary to strengthen the control of atmospheric pollution and the economic
and technological conditions in the PRC.
According to the (Law of the PRC on Prevention and Control
of Environmental Pollution by Solid Waste) promulgated on 30 October 1995 (and as amended on 29
December 2004 and 29 June 2013) and effective as of 1 April 2005, polluters, producers, salesmen and
importers shall bear legal liability if they fail to prevent and control the discharge of solid wastes.
According to the (Law of the PRC on Prevention and Control of
Environmental Pollution by Noise) promulgated on 29 October 1996 and effective as of 1 March 1997,
new construction, reconstruction and expansion projects that cause noise shall be subject to the state
regulations on environmental protection of construction projects. Industrial enterprises that cause much
noise during industrial production with xed facilities shall report to the local environmental protection
department the categories and quantities of their existing facilities for discharging noise, and the volume
of noise discharged under their normal operation conditions. They should also report on their facilities
to combat excessive noise, and submit technical information concerning the prevention and control of
noise pollution. Enterprises that cause excessive noise exceeding the relevant standards shall pay the
discharge fee subject to the regulations.
126
PRC Laws relating to Dangerous Chemicals
According to the (Regulation on the Safety Administration of Dangerous
Chemicals) promulgated on 26 January 2002, amended on 16 February 2011 and effective as of 1
December 2011, the safety administration of the production, storage, use, operation and transport
of dangerous chemicals shall comply with the provisions of this regulation. Any new construction,
reconstruction and expansion projects for producing and storing dangerous chemicals shall be subject
to the examination of competent work safety bureau. Before the production of dangerous chemicals,
the enterprise shall obtain the dangerous chemicals safety production permit according to the
(Measures for the Implementation of Work Safety Licences for
Dangerous Chemicals Production Enterprises) effective as of 1 December 2011, and the
(Regulation on Work Safety Licences) effective as of 13 January 2004 (and as amended on 18 July
2013). Enterprises producing dangerous chemicals listed in the industrial product catalogue shall obtain
the industrial product production licence according to the
(Regulation on Administration of Industrial Product Production Licence) effective as of 1 September 2005.
Activities relating to dangerous chemicals are highly regulated and subject to the relevant permissions
and licences from government authorities. Enterprises without such permissions or licences shall not
operate dangerous chemicals.
According to the (Measures on Registration Administration of Dangerous
Chemicals) (the Measures on Dangerous Chemicals) (promulgated on 1 July 2012 and effective as
of 1 August 2012) enterprises involved in the production and importation of dangerous chemicals listed
in the dangerous chemicals catalogue shall comply with the Measures on Dangerous Chemicals and
conduct dangerous chemicals registration.
According to the () (Measures on Registration of Environmental
Management of Dangerous Chemicals (for Trial Implementation)) promulgated on 10 October 2012 and
effective as of 1 March 2013, enterprises involved in the production and use of dangerous chemicals
listed in the dangerous chemicals catalogue shall conduct environmental management registration and
obtain the registration licence for environmental management of dangerous chemicals with valid term of
three (3) years.
PRC Laws relating to Taxation and Fees
(a) Resource Tax
According to the (Interim Regulations of the PRC on Resource
Tax) promulgated on 25 December 1993, effective as of 1 January 1994 and amended on 30
September 2011, any enterprise engaged in the exploitation of mineral products within the PRC is
required to pay a resource tax.
(b) Resource price adjustment fees
According to the (Price Law of the PRC) promulgated on 29 December
1997, and effective as of 1 May 1998, the state shall introduce and gradually improve the
mechanism of regulation of prices, mainly through market forces and macroeconomic controls.
Under this mechanism, pricing should be subject to the value law. Most types of merchandise and
services are to adopt market regulated prices, with only a few exceptions being subject to prices
set by the government.
The (Administrative Regulations of Sichuan Province on Price), adopted on
16 April 1996 and amended on 6 April 1998, regulates price behavior between the state organs,
enterprises, institutions, other organisations and individuals within the Sichuan administrative
region. It seeks to protect the legal rights of consumers and business operators.
Under the (Administrative Measures
of Mianzhu on the Collection and Use of Price Adjustment Fund of Phosphate Ore (for Trial
Implementation)), promulgated on 15 June 2012, enterprises and individuals who engage in
phosphate ore mining in Mianzhu shall pay the price adjustment fund of phosphate ore based on
volume on a monthly basis, at a rate of RMB30 per tonne.
127
(c) Mineral resources compensation fees
According to the (Provisions on the Administration of the Collection
of Mineral Resources Compensation Fees) promulgated on 27 February 1994, effective as of 1
April 1994 and amended on 3 July 1997, mineral resources compensation fees shall be paid by the
holder of the mining right.
(d) Mineral resources use fees
According to the (Procedures for Administration of Registration of
Mining of Mineral Resources) (promulgated on and effective as of 12 February 1998) mineral
resources use fees shall be paid by the holder of the mining right. The mineral resources use
fees shall be paid annually at an annual price of RMB1,000 (approximately S$207, based on the
Exchange Rate as at the Latest Practicable Date) per sq km of the mining area.
(e) Use fee and purchase price of mineral exploration and mining rights
According to the (Measures for the Administration of the Use
Fee and Purchase Price of Mineral Exploration and Mining Rights) promulgated on and effective as
of 7 June 1999, any party who conducts exploration and mining operations of mineral resources in
the PRC is required to pay a use fee for the mineral exploration and mining right, and the purchase
price for the mineral exploration and mining right.
The use fee for the mineral exploration right is calculated on the basis of the exploration period
and the size of the area, and is payable annually. The annual rate is RMB100 per sq km for the rst
three (3) exploration years, with an additional RMB100 per year from the fourth exploration year
onwards, up to a maximum of RMB500. The use fee for the mining right, which is RMB1,000 per sq
km per year, is payable annually based on the size of the mining area.
The purchase price for the mineral exploration and mining right shall be based on the valuation
price as determined by the competent department of geology and mineral resources under the
State Council. Such purchase price can be paid on a lump sum basis, or paid in installments. If the
purchase price is paid in installments, all payments shall be made within two (2) years for mineral
exploration rights; and within six (6) years for mining rights.
COMPETITION
To the best of our knowledge, we believe that the main competitors in the PRC in respect of our Mining
Operations are as follows:
(Deyang Haohua Qingping LinKuang Co., Ltd)
(Sichuan Lomon Phosphate Products Joint Stock Ltd. Company)
(Sichuan Mianzhu Chuanlong Chemicals Co., Ltd)
(Yunnan Malong Industry Group Co., Ltd)
To the best of our knowledge, we believe that the main competitors in the PRC in respect of our
phosphate-based chemical products are as follows:
(Hubei Xingfa Chemicals Group Co., Ltd)
(Jiangyin Chengxing Industrial Group Co. , Ltd)
(Wuhan Inorganic Salt Chemical Co., Ltd.)
128
In addition to the above, CRU, the Independent Market Consultant, has also identied the following as
competitors of our Group:
(Chongqing Chuandong Chemical (Group) Co., Ltd)
(Jiangsu Chengxing Phosph-Chemicals Co., Ltd)
(Yunphos Group Co., Ltd)
We have entered into co-operation arrangements with Lomon Products and Lomon Chemicals in respect
of our Mining Operations. Please refer to the section entitled General Information on our Group Mining
Operations - Co-operation arrangements of this Offer Document for further details. None of our Directors,
Substantial Shareholders or their Associates has any interest, direct or indirect, in any of our competitors
listed above.
COMPETITIVE STRENGTHS
Our Directors consider the following to be our core competitive strengths:
(i) Our phosphate rocks are of relatively higher quality than other phosphate rocks mined in
the PRC
Based on the CRU Industry Report, the P
2
O
5
content of a phosphate rock is the typical
benchmark by which phosphate rocks are valued and priced, as, inter alia, higher phosphate
content typically means lower impurity content, and in turn, higher reaction efciencies, less waste
and fewer processing issues.
The industry preference is for phosphate rocks with P
2
O
5
content of 29% to 32%. However, the
phosphate rock deposits in the PRC have been shrinking, and the phosphate rock deposits with
P
2
O
5
content of 30% or higher are currently estimated to constitute only 10% to 25% of the PRCs
phosphate rock deposits. The CRU Industry Report further states that most of the phosphate mines
in the PRC are mining phosphate rocks with P
2
O
5
content of 20% to 25%, and that the average
grade of PRCs phosphate rock deposits is estimated to have P
2
O
5
content of less than 20%.
Based on the WGM Report, the measured and indicated phosphate rock resources for Mine 1 have
an average P
2
O
5
content of 28.7%, and the measured and indicated phosphate rock resources for
Mine 2 have an average P
2
O
5
content of 29.4%.
In light of the foregoing, we believe that our Mining Operations will yield phosphate rocks with
relatively high P
2
O
5
content, which will be valued and priced as higher-quality phosphate rocks,
and should generate strong demand from customers. Between 1 January and 30 June 2013, we
obtained an aggregate of approximately 93,000 tonnes of phosphate rocks with an average P
2
O
5
content of 30.6%.
In addition, we believe that the phosphate rocks obtained from our Mining Operations have
relatively low arsenic content levels. Based on our internal measurements, we believe that our
phosphate rocks have arsenic content of between 8 to 10 ppm, which is relatively low.
We believe that we will also be able to enjoy production and cost efciencies as we use our
phosphate rocks with relatively high P
2
O
5
content and low arsenic content in our Chemical
Production Operations, which we expect will yield us higher production efciencies.
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(ii) We benet from relatively lower production costs
We believe that we currently enjoy relatively lower costs of production due to the following reasons:
Low costs of quality raw material
We will be able to benet from cost savings in our Chemical Production Operations using
phosphate rocks from our Mines. With our own captive phosphorite resources, we will not be
subject to volatility in supply of phosphate rocks since we will be able to control our supply of
phosphate rocks, barring unforeseen circumstances.
Production efciency
We believe that we will be able to enjoy cost savings arising from production efciencies
due to (i) the use of our phosphate rocks with relatively high P
2
O
5
content from our Mines in
our Chemical Production Operations, which translates to lower impurity contents and fewer
processing issues; and (ii) construction of the New Gongxing Facilities which incorporate
current technology.
Improved logistics and transportation
We believe that we will be able to benet from improved logistics and transportation
upon completion of certain initiatives undertaken by the PRC authorities post-Wenchuan
Earthquake.
In July 2009, the Sichuan Development Commission and the Hong Kong SAR Mainland
Affairs Bureau announced plans to jointly construct the Mian Mao Highway. The Mian Mao
Highway has been under construction since September 2009, and will increase accessibility
between our Mines and the New Gongxing Facilities once it is completed. This is signicant
as this allows us to plan for an increase of our phosphate rock output due to anticipated
shortened travelling time and improved road conditions, without having to incur costs
associated with the construction of the said infrastructure. The transportation costs incurred
in the transportation of phosphate rocks to the New Gongxing Facilities are expected to be
reduced accordingly.
Lower cost of electricity
We also benet from a stable and reliable supply of electricity for our Chemical Production
Operations, which are electricity-intensive. Our electricity is supplied by the State Grid which
is generated via hydro power. By avoiding use during the low-water periods, we are able to
access a low-cost source of electricity for our Chemical Production Operations.
(iii) Our Mines and the New Gongxing Site are located close to each other and our customers
We believe that our Mines and the New Gongxing Site are strategically located in close proximity
to each other, with quick access to our customers and to transportation networks. The distance
between our Mines and the New Gongxing Site is approximately 40 km. As such, we will be able
to minimise transportation costs in the delivery of our phosphate rocks from our Mines to the New
Gongxing Facilities. Upon the completion of the Mian Mao Highway, we expect to benet from more
reliable and shortened time required for the delivery of our phosphate rocks from our Mines to the
New Gongxing Facilities and to our customers.
We are able to sell our phosphate-based chemical products to users of our products located in the
vicinity of our operations. As Sichuan Province in the PRC is generally agriculturally-focused, we
are able to sell our phosphate rocks to manufacturers of fertilisers located in Sichuan Province,
PRC. Our strategic proximity to these manufacturers provides us with a competitive edge over
our competitors as we are able to provide quality phosphate at lower costs due to savings in
transportation costs.
130
(iv) We have an experienced management team
We have a dedicated and experienced management team, led by our CEO and Executive Director,
Dr. Ong Hian Eng, which has extensive knowledge of, and experience in, the phosphate industry
and provides our Group with the skills and expertise to implement its strategy.
Our Directors are supported by our team of experienced and competent Key Executives. Some
Key Executives are based in our headquarters in Singapore and others are based full-time in the
PRC to manage the operations of Mianzhu Norwest in the PRC. Many of our Key Executives have
over ten (10) years of relevant experience in their respective elds. Please refer to the sections
entitled Management and Corporate Governance Directors and Management and Corporate
Governance Key Executives of this Offer Document for further details on the working experience
of our Executive Directors and Key Executives.
PROSPECTS AND TREND INFORMATION
The following discussions about our prospects and trends include forward-looking statements that involve
risk and uncertainties. Actual results could differ materially from those that may be projected in these
forward-looking statements. Please also refer to the section entitled Cautionary Note Regarding Forward-
Looking Statements of this Offer Document. Barring unforeseen circumstances, our Directors have made
the following observations for the current nancial year ending 31 December 2013:
(a) we expect prices of phosphate rocks to trend upwards in the near-term based on past average
sale prices of our phosphate rocks. While we expect phosphate rock demand to trend upwards in
the near-term, short-term uctuations in demand can be expected as a result of changes in crop
or fertiliser prices, weather events, and/ or economic disruptions. We expect prices of fertilisers, a
main application of phosphates, to trend upwards due to an increasing demand for food from an
increasing world population and limitations in the amount of arable land for farming;
(b) we expect the prices of phosphate-based chemical products to remain steady due to competitive
pressures, the strengthening of RMB and measures by the PRC government to regulate the prices
of essential foodstuffs;
(c) we are in the development and expansion phases in respect of our operations and we expect our
costs of operations (including costs of electricity, labour and logistics) to materially increase in line
with the increased scale of our Mining Operations, and the commencement, and increase in scale
thereafter, of our Chemical Production Operations;
(d) we received subsidies and compensation from the PRC government in connection with the
Wenchuan Earthquake and the Relocation Exercise, which have already been signicantly
utilised prior to FY2013. Excluding such subsidies and compensation, we would have recorded
lower prots for FY2011 and losses for FY2012. We do not expect to receive any further material
government subsidies or compensation in relation to the Wenchuan Earthquake and the Facilities
Relocation;
(e) we have been stockpiling, while selectively selling some of our phosphate rocks in anticipation of
the commencement of our Chemical Production Operations. Although as at the Latest Practicable
Date, we have completed construction of our P
4
Plant and have commenced Trial Chemical
Production Operations, we do not expect any signicant revenue contribution from our Chemical
Production Operations until Commercial Chemical Production Operations have commenced; and
(f) a portion of our Invitation expenses will be treated as a charge in our nancial statements, and we
expect our expenses to increase due to, inter alia, compliance costs incurred as a listed company.
Please refer to the section entitled Use of Proceeds of this Offer Document for more details on
our listing expenses.
131
In light of the reasons set out in paragraphs (c) to (f) above and taking into consideration our unaudited
results for FP2013, our nancial results may be less favourable in FY2013 as compared with FY2012,
and for FY2013, we may not be able to eliminate the losses already incurred in FP2013.
Please also refer to the CRU Industry Report set out in Appendix L to this Offer Document for more
information regarding the prospects of the phosphate industry. While we believe that the information and
data in the CRU Industry Report are reliable, we cannot ensure the accuracy of the information or data,
and neither our Group, the Vendors, the Sponsor and Underwriter, the Placement Agent or any of our or
their respective afliates or advisers have independently veried the information or data.
Save as discussed above and in the sections entitled Risk Factors and General Information on our
Group Business Strategies and Future Plans of this Offer Document, and barring any unforeseen
circumstances, our Directors are not aware of any signicant recent trends or any other known trends,
uncertainties, demands, commitments or events that are reasonably likely to have a material effect on our
Groups revenue, protability, liquidity or capital resources, or that would cause the nancial information
disclosed in this Offer Document to be not necessarily indicative of the future operating results or
nancial condition of our Group.
BUSINESS STRATEGIES AND FUTURE PLANS
Our business strategies and future plans for the growth and expansion of our business are further
described below. We intend to execute the business strategies and/ or implement the following future
plans over the next 18 months.
Further Mining Operations and exploration activities to increase phosphorite resources and
output
Further mining operations and exploration activities
We intend to carry out further mining operations and exploration activities, including:
(i) exploration work (such as geological mapping, rock sampling, drilling activities, excavating and
tunnelling, collection and analysis of exploration data and exploring and locating new deposits
within specied areas permitted under our exploration rights with a view to converting our
exploration rights into mining rights);
(ii) converting phosphorite resources classied as inferred resources to measured and indicated
resources; and
(iii) increasing measured and inferred resources within specied areas permitted under our exploration
rights.
Barring any unforeseen circumstances, we intend to engage a professional geological company
to survey the areas permitted under our exploration rights and determine the quantity of phosphorite
resources present in such areas. The survey results will assist us to facilitate the increase of our Groups
phosphorite resources and enable us to plan our Mining Operations and schedules to optimise efciency.
We expect to spend approximately S$1.4 million for this purpose by the end of FY2014.
We have located phosphate rock deposits in certain of our adits in the exploration areas, and are
currently carrying out exploration activities to verify the level of deposits and secure sufcient phosphate
rocks with a view to converting our exploration rights to mining rights. Barring any unforeseen
circumstances, and subject to compliance with all legal and regulatory requirements, we intend to apply
for the conversion of our relevant exploration rights to mining rights in FY2014. We intend to spend
approximately S$4.0 million to procure the conversion of our relevant exploration rights to mining rights.
We intend to fund the total estimated expenditure for the above-mentioned activities, of approximately
S$5.4 million, with the net proceeds from the issue of New Shares.
132
We may also explore the possibility of securing additional exploration rights for areas close to our existing
exploration and mining rights.
Construction of adits
Currently, we have four (4) adits in our two (2) Mines which are producing phosphate rocks. We also have
three (3) adits in the exploration areas. Upon the successful conversion of our relevant exploration rights
to mining rights, we intend to increase the number of adits which are producing phosphate rocks to up to
12 adits. Barring any unforeseen circumstances and subject to compliance with all legal and regulatory
requirements, we intend to complete construction works for the adits by the end of FY2014.
The expenditure for the construction of up to ve (5) additional adits is currently estimated to be
approximately S$1.6 million. We have earmarked approximately S$0.9 million of the net proceeds from
the issue of New Shares for the construction of the above-mentioned adits in FY2013 and FY2014, and
we intend to fund the balance using a combination of internal funds and external nancing (if we deem
such nancing arrangements necessary or desirable).
Investment in mining-related infrastructure and equipment
Within the next 18 months, we plan to invest in mining-related infrastructure, haulage systems and related
equipment to improve productivity and safety standards at our Mines.
We intend to purchase haulage systems and related equipment for installation in new adits which we may
construct, and other related equipment to upgrade the haulage systems for our existing adits. We also
intend to procure and perform additional safety design, consultancy and modication works in our existing
adits.
On the assumption that construction works for new adits complete as we have planned by the end of
FY2014, the expenditure for the purchase and installation of haulage systems and related equipment,
and the performance of additional works and safety enhancements to our existing adits, is currently
estimated to be approximately S$2.0 million up to FY2014.
We also plan to improve access to our Mines and adits by maintaining and repairing the access
roads leading to these areas, and barring any unforeseen circumstances, we expect to complete such
improvements by the end of FY2014. The expenditure for such improvements is currently estimated to be
approximately S$0.2 million.
We intend to fund the total estimated expenditure for the above-mentioned activities, of approximately
S$2.2 million, with the net proceeds from the issue of New Shares. We intend to fund further expenditure
relating to the above-mentioned activities (if any) from our internal funds, and we may obtain external
nancing if we deem such nancing arrangements necessary or desirable.
Adopting a vertically-integrated strategy
Prior to the Wenchuan Earthquake, we adopted a vertically-integrated strategy with our Mines supplying
phosphate rocks for our Chemical Production Operations. Upon the completion of Phase 1 and Phase 2
of the Rebuilding Programme, we intend to continue adopting a vertically-integrated strategy.
Once implemented, our vertically-integrated business model will comprise our Mining Operations and
Chemical Production Operations. This will allow us to benet from operational synergies.
We believe that our vertically-integrated strategy will provide us with the following advantages:
Raw materials price and supply stability We will be able to control our processing costs as our
main raw material, phosphate rocks, will be supplied by our Mines. We are also able to cushion
to some extent our margins from the impact of uctuations in prices of our intermediate products,
such as phosphoric acid and P
4
,

which may be used as raw materials. In addition, our Mines
provide us with a more stable source of raw materials to our Chemical Production Operations.
133
Raw materials quality assurance As we intend to use phosphate rocks from our Mines for our
Chemical Production Operations, we are able to control and are thereby assured of the quality of
raw materials used.
Sales and production exibility We will have the exibility of allocating our phosphate rocks
to either direct sales or to our Chemical Production Operations. Depending on our business
strategies, production schedules, existing orders, market prices of and demand for our phosphate
rocks and phosphate-based chemical products, we will have the exibility to produce and sell
our phosphate rocks and phosphate-based chemical products in accordance with current market
conditions to optimise prot margins and achieve our business strategies.
Rebuilding, enhancing and increasing the capacity of our Chemical Production Operations
Phase 1 of the Rebuilding Programme
Our Group has completed the construction of our P
4
Plant (which includes the construction of two (2)
furnaces) at the New Gongxing Site under Phase 1 of the Rebuilding Programme, and has commenced
trial production of P
4
in FY2013. As at the Latest Practicable Date, we have expended approximately
RMB121.4 million (approximately S$25.2 million based on the exchange rate as at the Latest Practicable
Date) on the construction of our New Gongxing Facilities.
We plan to build a ue gas storage facility to collect ue gas, which is a by-product generated from the
production of P
4
. The ue gas that is collected will be used to heat the furnaces to aid in the production of
STPP and SHMP. Barring any unforeseen circumstances, we intend to commence the building of the ue
gas storage facility in the fourth quarter of 2013, and complete such building works by the end of FY2014.
Such building works are currently estimated to cost S$1.4 million, all of which is expected to be expended
by FY2014.
Phase 2 of the Rebuilding Programme
Barring any unforeseen circumstances, and subject to meeting all regulatory and legal requirements, we
expect to receive the land use rights for Phase 2 of the Rebuilding Programme by the end of FY2014. We
intend to spend an additional S$0.6 million in payments towards securing such land use rights.
We intend to, barring any unforeseen circumstances and upon receipt of the land use rights for Phase 2
of the Rebuilding Programme, increase the scale of our Chemical Production Operations (commencing
in 2014) by enhancing our processing and manufacturing capabilities through the construction and
upgrading of processing facilities. Phase 2 of our Rebuilding Programme involves the following:
Facilities
Designed capacity
(tonnes per year)
Relocating and upgrading of one (1) food grade and non food grade STPP plant
(completed as at the Latest Practicable Date) 30,000
Construction of one (1) new thermal phosphoric acid plant 30,000
Construction of one (1) new food grade and non food grade SHMP plant 20,000
As part of the Rebuilding Programme, we intend to construct (i) ofces, dormitories and other operating
facilities (such as laboratories); and (ii) infrastructure for the factories (such as access roads), at the New
Gongxing Site.
As at the Latest Practicable Date, we have expended approximately RMB4.6 million (approximately S$0.9
million based on the exchange rate as at the Latest Practicable Date) on Phase 2 of our Rebuilding
Programme. For FY2013 and FY2014, we intend to spend approximately S$5.9 million for the
construction of the above-mentioned facilities, barring any unforeseen circumstances and assuming that
our expansion plans progress as intended.
134
Please refer to the section entitled General Information of our Group Chemical Production Operations
of this Offer Document for further details of our processing facilities.
In aggregate, the estimated capital expenditure for the planned enhancement and increase in capacity of
our operations mentioned above is approximately S$7.9 million. We intend to fund such expenditure with
the net proceeds from the issue of New Shares.
Increasing our portfolio of phosphate-based chemical products
Prior to the Wenchuan Earthquake and the Relocation Exercise, we produced P
4
, thermal phosphoric
acid, SHMP and STPP, for sale to customers in the PRC and other countries. We also established an
ad hoc product development team headed by our Key Executive, Wang Xuebo, to expand our range of
Upon completion of the Rebuilding Programme, we intend to produce P
4
, thermal phosphoric acid, SHMP
and STPP, and further diversify our portfolio of phosphate-based chemical products by establishing an in-
house research and development team and/ or outsourcing such function to third parties to develop and
offer to our customers a wider range of phosphate-based chemical products.
Expanding through acquisitions, joint ventures and strategic alliances
We may expand through acquisitions, joint ventures and strategic alliances as part of our long-term
growth strategy. We may also enter into acquisitions, joint ventures or strategic alliances with parties
who create synergistic values with our existing business. Should such opportunities arise, we will seek
approvals, where necessary, from our Shareholders and the relevant authorities as may be required by
prevailing laws and regulations.
Save as disclosed in this Offer Document, none of the proceeds of the issue of New Shares will be
used, directly or indirectly, to acquire or renance the acquisition of an asset other than in the ordinary
course of business. Please refer to the section entitled Risk Factors of this Offer Document for further
discussion of the risks in relation to how our future growth will depend on our ability to manage our
expansion plans, and dilution as a result of raising additional funds through the issue of New Shares for
future growth.
ORDER BOOK
Our Group does not typically enter into any long-term supply contracts for the sale of phosphate rocks.
Therefore, as at the Latest Practicable Date, the order book is not material.
Due to the nature of our business, phosphate rocks and phosphate-based chemical products are subject
to uctuations in prices. In accordance with our risk management policy, we consider various factors,
including market conditions, before entering into contracts entailing delivery or completion of more than
three (3) months.
135
SELECTED COMBINED FINANCIAL INFORMATION
The following selected combined statements of comprehensive income and combined balance sheets of
our Group should be read in conjunction with the full text of this Offer Document, including the Audited
Combined Financial Statements for the nancial years ended 31 December 2010, 2011 and 2012 as
set out in Appendix A to this Offer Document, the Unaudited Interim Condensed Combined Financial
Statements for the three months period ended 31 March 2013 as set out in Appendix B to this Offer
Document, and the section entitled Managements Discussion and Analysis of Results of Operations and
Financial Position of this Offer Document.
Combined Statements of Comprehensive Income
(1)
Audited Unaudited
FY2010 FY2011 FY2012 FP2012 FP2013
$000 $000 $000 $000 $000
Revenue 2,775 4,522 4,897 1,004 1,310
Cost of sales (2,373) (2,148) (2,796) (648) (865)
Gross prot 402 2,374 2,101 356 445
Other income 981 2,535 3,538 1,361 8
Selling and distribution costs (426) (483) (227) (53) (87)
General and administrative costs (2,738) (1,484) (3,899) (489) (1,105)
Other operating income 627
Finance costs (52) (9) (4) (1) (10)
(Loss)/prot before tax (1,206) 2,933 1,509 1,174 (749)
Taxation 28 (284)
(Loss)/prot for the year/period attributable
to owners of the Company (1,178) 2,933 1,225 1,174 (749)
Other comprehensive (loss)/income
Foreign currency translation (101) 535 (918) (448) 365
Total comprehensive (loss)/income for the
year/period attributable to owners of the
Company (1,279) 3,468 307 726 (384)
(Loss)/earnings per share (cents)
Basic
(2)
(0.17) 0.42 0.17 0.17 (0.11)
Adjusted
(3)
(0.15) 0.37 0.15 0.15 (0.09)
Notes:
(1) For comparative purposes, the combined statements of comprehensive income of our Group for the Period Under Review
have been prepared on the basis that our Group has been in existence throughout the Period Under Review. Please refer to
note 2 of the Audited Combined Financial Statements for the nancial years ended 31 December 2010, 2011 and 2012 as
set out in Appendix A to this Offer Document and the Unaudited Interim Condensed Combined Financial Statements for the
three months period ended 31 March 2013 as set out in Appendix B to this Offer Document.
(2) For comparative purposes, the basic (loss)/earnings per share for the Period Under Review have been computed based on
the (loss)/prot for the year/period attributable to owners of the Company and our pre-Invitation share capital of 702,400,000
Shares (after the Share Split (as dened in the section entitled Restructuring Exercise of this Offer Document)).
(3) For comparative purposes, the adjusted (loss)/earnings per share for the Period Under Review have been computed
based on the (loss)/prot for the year/period attributable to owners of the Company and our post-Invitation share capital of
800,000,000 Shares (after the Share Split).
136
SELECTED COMBINED FINANCIAL INFORMATION
Combined Balance Sheet
(1)
Audited Unaudited
As at 31
December
2010
As at 31
December
2011
As at 31
December
2012
As at 31
March
2013
$000 $000 $000 $000
Non current assets
Mine properties 906 813 675 651
Land use rights 815 1,763 1,642 1,664
Property, plant and equipment 2,346 16,474 28,778 28,441
Prepayments 2,599 3,928 2,093 2,132
6,666 22,978 33,188 32,888
Current assets
Stocks 1,983 3,043 2,907 3,275
Trade receivables 183 198 137 462
Other receivables 165 380 1,750 1,766
Deferred expenses 308 343 380
Prepayments 291 313 492 487
Cash and bank balances 983 3,213 4,772 3,177
3,605 7,455 10,401 9,547
Total assets 10,271 30,433 43,589 42,435
Current liabilities
Trade payables 166 470 1,306 797
Other payables 4,548 8,036 10,172 7,795
Advances from customers 368 627 147 25
Amounts due to ultimate holding company 600 2,050 646
Interest-bearing bank loans 912 987
6,594 11,183 12,271 9,604
Net current liabilities (2,989) (3,728) (1,870) (57)
Non-current liabilities
Deferred tax liabilities 42 42 320 326
Deferred income 2,247 2,348 2,231 2,272
Provision for rehabilitation 54 58 158 162
2,343 2,448 2,709 2,760
Total liabilities 8,937 13,631 14,980 12,364
Net assets 1,334 16,802 28,609 30,071
Equity attributable to owners of the Company
Share capital 9,048 21,048 32,548 34,394
Reserves (7,714) (4,246) (3,939) (4,323)
Total equity 1,334 16,802 28,609 30,071
Net Asset Value per Share (cents)
(2)
0.19 2.39 4.07 4.28
Notes:
(1) For comparative purposes, the combined balance sheets of our Group for the Period Under Review have been prepared on
the basis that our Group has been in existence throughout the Period Under Review. Please refer to note 2 of the Audited
Combined Financial Statements for the nancial years ended 31 December 2010, 2011 and 2012 as set out in Appendix A
to this Offer Document and the Unaudited Interim Condensed Combined Financial Statements for the three months period
ended 31 March 2013 as set out in Appendix B to this Offer Document.
(2) For comparative purposes, the net asset value per share for the Period Under Review has been computed based on the net
asset value of our Group divided by our pre-Invitation share capital of 702,400,000 Shares (after the Share Split).
137
MANAGEMENTS DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS
AND FINANCIAL POSITION
The following discussion of our business, results of operations and nancial position for the Period Under
Review should be read in conjunction with the full text of this Offer Document, including the section
entitled Selected Combined Financial Information of this Offer Document, the Audited Combined
Financial Statements for the nancial years ended 31 December 2010, 2011 and 2012 as set out in
Appendix A to this Offer Document, the Unaudited Interim Condensed Combined Financial Statements
for the three months period ended 31 March 2013 as set out in Appendix B to this Offer Document and
the Unaudited Pro Forma Combined Financial Information for the nancial year ended 31 December
2012 and the three months period ended 31 March 2013 as set out in Appendix C to this Offer
Document. This discussion contains forward-looking statements that involve risks and uncertainties. Our
actual results may differ signicantly from those projected in the forward-looking statements. Factors that
might cause our actual future results to differ signicantly from those projected in the forward-looking
statements include, but are not limited to, those discussed below and elsewhere in this Offer Document,
particularly, in the sections entitled Risk Factors and Cautionary Notes Regarding Forward-Looking
Statements of this Offer Document. Under no circumstances should inclusion of such forward-looking
statements herein be regarded as a representation, warranty or prediction with respect to the accuracy
of the underlying assumptions by us, the Vendors, the Sponsor and Underwriter, the Placement Agent
or any other person. Investors are cautioned not to place undue reliance on these forward-looking
statements that speak only as of the date hereof.
The gures in this section are approximate gures and where appropriate, have been rounded to the
nearest one (1) decimal place.
OVERVIEW
chemical products.
We are currently headquartered in Singapore, and possess the rights to explore and mine phosphate
in Sichuan Province, the PRC. We have also completed the construction of our P
4
Plant at the New
Gongxing Site under Phase 1 of the Rebuilding Programme in preparation for the resumption of our
Chemical Production Operations.
Our Group is organised into business units based on their products and services as follows:
(a) upstream segment relates to our business of exploration, mining and sale of phosphate rocks (the
Upstream Segment); and
(b) downstream segment relates to our business of manufacturing, sale and trading of phosphate-
based chemical products such as P
4,
thermal phosphoric acid, STPP and SHMP; and the sale of
by-products produced as a result of such manufacturing process (the Downstream Segment).
Prior to the Wenchuan Earthquake, we were engaged in both Mining Operations and Chemical
Production Operations in a vertically-integrated production process. Therefore, our revenue was derived
from the sales of both phosphate rocks and phosphate-based chemical products which we produced.
Our Mining Operations were carried out at our Mines while our Chemical Production Operations were
carried out at our then production facilities located at the Previous Hanwang Facilities, both located in
Mianzhu City, Sichuan Province, the PRC.
Immediately after the Wenchuan Earthquake, there was no output from our Mines or our production
facilities. Resumption of operations of our Mines was further delayed by landslides which occurred in the
vicinity of our Mines in 2010. In FY2010, we commenced the recovery stage of our Mining Operations
at Mine 1 and obtained an initial output of approximately 4,200 tonnes of phosphate rocks. In FY2011,
our phosphate rocks output increased to approximately 30,200 tonnes and this further increased to
approximately 60,100 tonnes of phosphate rocks in FY2012. Our phosphate rocks output for FP2012 and
FP2013 was 2,000 tonnes and 16,600 tonnes respectively.
138
Although part of our production facilities at the Previous Hanwang Facilities was damaged by the
Wenchuan Earthquake, we were able to continue to record revenue in our Downstream Segment as
we sold existing quantities of SHMP and STPP to certain customers in fulllment of our contractual
arrangement with these customers as well as to maintain the business relationship of these customers.
We were able to do this despite the damage sustained by our P
4
and thermal phosphoric acid production
facilities as we had existing inventory of P
4
and thermal phosphoric acid and when these inventory stocks
were depleted, we were able to secure P
4
and thermal phosphoric acid from third party suppliers to
produce SHMP and STPP for sale.
After the Wenchuan Earthquake, the local PRC authorities decided to re-develop the land on which
the Previous Hanwang Facilities were located. Hence, such PRC authorities entered into an agreement
with Mianzhu Norwest in 2011, pursuant to which Mianzhu Norwest surrendered the land use rights,
relocated our STPP plant from the Previous Hanwang Facilities to the New Gongxing Facilities and
vacated the Previous Hanwang Facilities (the Facilities Relocation) and received a compensation of
RMB35 million, in stages, from the local PRC authorities. At the end of 2011, we successfully obtained
the land use rights for Phase 1 Land. The government grants and proceeds from the Facilities Relocation
have been signicantly utilised in the Period Under Review. From FY2013 onwards, we do not expect to
receive any signicant benet from such government grants and proceeds.
As the New Gongxing Facilities have yet to commence commercial operations and will be built to
different specications than the Previous Hanwang Facilities, our revenue, cost of sales and other costs
relating to the operation and maintenance of the New Gongxing Facilities will be different from that
of the Previous Hanwang Facilities. Accordingly, the revenue and costs associated with the Chemical
Production Operations and operating costs of the Previous Hanwang Facilities as included in the Period
Under Review cannot be taken as an indication of the revenue and costs associated with the Chemical
Production Operations at the New Gongxing Facilities or the operating costs of the New Gongxing
Facilities. For the purposes of discussion in this section entitled Managements Discussion and Analysis
of Results of Operations and Financial Position of this Offer Document, our Previous Hanwang Facilities
(which was operational prior to the Wenchuan Earthquake and partially operational after the Wenchuan
Earthquake until completion of the Facilities Relocation) and New Gongxing Facilities (where only Phase
1 has commenced trial production of P
4
in FY2013) are collectively referred to as our Facilities.
PRINCIPAL COMPONENTS OF OUR COMBINED INCOME STATEMENT
Revenue
Our revenue comprises both the Upstream Segment and the Downstream Segment. Revenue for the
Upstream Segment is derived from the sale of phosphate rocks to third party customers comprising
mainly fertiliser companies and manufacturers of downstream phosphate-based chemical products in
the PRC. Revenue for the Downstream Segment is derived mainly from the sale of phosphate-based
chemical products such as STPP and SHMP to third party customers comprising mainly manufacturers
of downstream phosphate-based chemical products as well as producers of fast moving consumer goods
in the PRC and worldwide. During the Period Under Review, we sold our phosphate-based chemical
products to countries such as New Zealand, the Philippines, the USA, Switzerland and Vietnam.
Revenue is recognised to the extent that it is probable that the economic benets will ow to our Group
and that the revenue can be reliably measured. Revenue is measured at the fair value of consideration
received or receivable, excluding discounts, rebates and sales taxes or duty. Revenue is not recognised
to the extent where there are signicant uncertainties regarding recovery of the consideration due,
associated costs or the possible return of goods.
Revenue from sale of goods is recognised upon the transfer of signicant risks and rewards of ownership
of the goods to the customer. Transfers of risks and rewards vary depending on the individual terms of
the sale contract. Transfers may occur when the goods are dispatched from the warehouses (mainly for
domestic sales) or upon loading the goods onto the relevant carrier (mainly for export sales).
139
Our revenue from sale of phosphate rocks are derived from sales to only PRC-based customers.
Currently, we do not export phosphate rocks as we do not have the relevant license imposed by the PRC
government. While we collect cash upfront from most of our customers, we recognise revenue from the
sale of our phosphate rocks upon collection of the phosphate rocks by our customers. The sale price of
phosphate rocks are determined after taking into consideration, inter alia, the quality of the phosphate
rocks, prevailing market prices as well as prevailing market conditions and includes value-added tax.
Our phosphate-based chemical products are sold to customers in the PRC and overseas who are
normally granted credit terms of between 30 and 60 days. We typically recognise revenue from the sale
of phosphate-based chemical products (i) for PRC-based customers, when delivery of our phosphate-
based chemical products are acknowledged by our customers; and (ii) for overseas customers, when
our phosphate-based chemical products are loaded onto the ships and acknowledged by the shipping
company as export sales are mainly on free-on-board terms. The sale price of our phosphate-based
chemical products is based on negotiated commercial terms which will take into consideration our cost of
production, prevailing market conditions, size of the order, internal credit rating of the customer and past
track record of the customer and credit terms granted. The sale price of our phosphate-based chemical
products includes value-added tax and, where relevant, related transport costs.
Sales to our PRC-based customers are denominated in RMB while sales to our customers not based in
the PRC are denominated in USD.
The breakdown of our revenue by business segments for FY2010, FY2011, FY2012, FP2012 and
FP2013 is set out below:
Revenue FY2010 FY2011 FY2012 FP2012 FP2013
$000 % $000 % $000 % $000 % $000 %
Upstream Segment 357 12.9 1,496 33.1 3,700 75.6 607 60.5 969 74.0
Downstream Segment 2,418 87.1 3,026 66.9 1,197 24.4 397 39.5 341 26.0
2,775 100.0 4,522 100.0 4,897 100.0 1,004 100.0 1,310 100.0
The breakdown of our revenue by products for FY2010, FY2011, FY2012, FP2012 and FP2013 is set out
below:
$000 % $000 % $000 % $000 % $000 %
Upstream Segment
Phosphate rocks 357 12.9 1,496 33.1 3,700 75.6 607 60.5 969 74.0
Downstream Segment
STPP 1,862 67.1 2,858 63.2 965 19.7 332 33.0 279 21.3
SHMP 538 19.4 168 3.7 232 4.7 65 6.5 62 4.7
Others
(1)
18 0.6
2,775 100.0 4,522 100.0 4,897 100.0 1,004 100.0 1,310 100.0
Note:
(1) Consists of by-products produced as a result of the production of P
4
, namely ferrophosphate.
140
The breakdown of our revenue based on the geographical location of our customers for FY2010, FY2011,
FY2012, FP2012 and FP2013 is set out below:
$000 % $000 % $000 % $000 % $000 %
PRC 1,257 45.3 2,447 54.1 4,373 89.3 883 87.9 1,191 90.9
New Zealand 112 4.0 172 3.8 305 6.2 61 6.1 31 2.4
Philippines 83 3.0 270 6.0 139 2.8 56 5.6
United States of America 778 28.0 743 16.4
Switzerland 271 9.8 141 3.1
Vietnam 192 6.9 252 5.6
United Arab Emirates 26 1.0 438 9.7 35 0.7
Spain 28 0.6 67 5.1
Others
(1)
56 2.0 31 0.7 45 1.0 4 0.4 21 1.6
2,775 100.0 4,522 100.0 4,897 100.0 1,004 100.0 1,310 100.0
Note:
(1) Includes countries such as Canada, India, South Korea and Pakistan.
FACTORS AFFECTING REVENUE
Our Groups operations have historically been inuenced by the following key factors, which our
management believes will continue to affect our Groups results of operations in the future:
(a) Changes in selling prices of our Groups products
The factors that affect the selling price of our Groups products are as follows:
(i) Economic conditions
The demand and prices of our phosphate rocks and phosphate-based chemical products
were adversely affected by the global nancial crisis which occurred in 2008. Any occurrence
of similar situations in the future or other economic situations which can affect phosphate
prices in general or phosphate rocks and/ or phosphate-based chemical products in
particular will similarly affect our Group.
(ii) Prices of fertilisers
Our Group believes that a signicant portion of the worlds phosphate rock output is used in
the production of fertilisers. Hence the prices of fertilisers play a key role in determining the
prices of phosphate rocks in the Upstream Segment. Prices of fertilisers are in turn affected
by other factors such as, but not limited to, agriculture commodity prices, cyclical trends in
end-consumer market, governmental policies relating to the sale of fertilisers and/ or the
agriculture industry and weather conditions.
Prices for fertilisers have a signicant impact on our Groups revenue as well as our Groups
protability, which generally tends to increase when prices for fertilisers increase. When
prices of fertiliser increase (hence causing phosphate rock prices to increase), the costs
of most of the associated raw materials also tend to rise and vice versa. Since changes
in prices of our phosphate-based chemical products do not correlate exactly in the same
period, our Groups prot margin may vary from period to period due to this lag effect.
141
(iii) Competition
The sale price and protability of our Groups phosphate-based chemical products are
affected by competition from other phosphate-based chemical products producers. As
phosphate-based chemical products are generally homogeneous, producers may resort to
reducing prices to increase sales and/ or gain market share. The prices and demand for our
Groups phosphate-based chemical products are also affected by the market supply of these
products, which in turn is largely dependent on the number of producers, their production
capacities, factory utilisation rates and operating margins.
(iv) Foreign exchange rates
The percentage of our Groups sales to customers not based in the PRC decreased from
54.7% in FY2010 to 45.9% in FY2011 and further decreased to 10.7% in FY2012. For
FP2013, our Groups sales to customers not based in the PRC further reduced to 9.1%. Our
Groups selling prices for our phosphate-based chemical products to customers not based
in the PRC are denominated in USD. Therefore, our Groups protability will be affected
by the total sales to customers not based in the PRC and the then-prevailing conversion
rates between USD and RMB. The RMB against USD exchange rate had decreased from
RMB6.59:USD1.00 as at 31 December 2010 to RMB6.30:USD1.00 as at 30 December 2011
to RMB6.23:USD1.00 as at 31 December 2012. As at 29 March 2013, the RMB against USD
exchange rate has decreased further to RMB6.21:USD1.00.
In addition, as our nancial statements are presented in S$, we will also record translation
gains or losses from the conversion of our revenue denominated in RMB into our
presentation currency of S$.
(b) Changes in sale volumes of our Groups principal products
The factors that affect the sale volume of our Groups products are as follows:
(i) Sales mix
The mix of revenue derived from the Upstream Segment and the Downstream Segment
affects our Groups revenue and protability as our Upstream Segment usually generates a
higher gross prot margin compared to the Downstream Segment. In FY2010, our Groups
revenue was mainly contributed by the Downstream Segment as our Group only resumed
our Mining Operations in November 2010. The resumption of Mining Operations contributed
to the increase in revenue contribution from the Upstream Segment from 33.1% in FY2011
to 75.6% in FY2012. For FP2013, revenue contributed from the Upstream Segment stood at
74.0% compared to 60.5% for FP2012.
(ii) Production capacity
Our revenue is based on the amount of phosphate rocks obtained and phosphate-based
chemical products produced and sold within each nancial period and on the prices we
receive for the sale of such phosphate rocks or phosphate-based chemical products. The
volume of phosphate rocks we obtain is dependent on our ability to mine, subject to the
mining limit under the mining rights. Our production volume of our phosphate-based
chemical products depended on our Facilities production capacity.
(iii) Market conditions
Depending on the prevailing market price for phosphate rocks and phosphate-based
chemical products, our Group may choose to sell more phosphate rocks or channel more of
its phosphate rocks to its Chemical Production Operations. Our management monitors the
global phosphate market, especially the PRC phosphate market to determine whether to sell
the phosphate rocks or channel the phosphate rocks to its Chemical Production Operations.
142
(iv) Government policies
The sale of phosphate rocks is subject to strict PRC government regulations. Currently, we
do not export phosphate rocks as we do not have the relevant license required by the PRC
laws, rules and regulations.
Furthermore, in the past years, certain countries have imposed bans and/ or limits on the
use of phosphate-based chemicals in detergents. Certain countries are also considering
whether to extend bans and/ or limits to encompass industrial and institutional use of
detergents and whether to further reduce phosphate levels in soap for dishwashers. If such a
limit were to be imposed, the demand for phosphate-based chemical products may decrease.
Any similar policies introduced by the PRC and/ or other foreign governments in the future
may have a negative impact on our Groups operations and affect the protability of our
Group.
(v) Ability to retain existing customers and secure new customers
The demand for our phosphate rocks and phosphate-based chemical products is determined
by the quality and price competitiveness of our products and our level of service quality. As
phosphate rocks and phosphate-based chemical products are generally homogeneous, our
customers may purchase the same product from our competitors.
COST OF SALES
The breakdown of our cost of sales for FY2010, FY2011, FY2012, FP2012 and FP2013 is set out below:
Cost of Sales FY2010 FY2011 FY2012 FP2012 FP2013
$000 % $000 % $000 % $000 % $000 %
Changes in stock level 990 41.7 (922) (42.9) (16) (0.5) 223 34.4 (312) (36.1)
Co-operation partners
costs 101 4.3 391 18.1 657 23.5 34 5.2 95 11.0
Transportation costs 39 1.6 304 14.2 616 22.0 21 3.2 164 19.0
Materials and overheads 1,117 47.0 1,735 80.8 177 6.3 257 39.7 285 32.9
Direct labour 87 3.7 468 21.8 630 22.5 31 4.8 340 39.3
Government taxes and
fees 2 0.1 77 3.6 439 15.7 10 1.5 170 19.7
Depreciation and
amortisation 42 1.8 127 5.9 131 4.7 27 4.2 31 3.6
Others
(1)
(5) (0.2) (32) (1.5) 162 5.8 45 7.0 92 10.6
Total 2,373 100.0 2,148 100.0 2,796 100.0 648 100.0 865 100.0
Note:
(1) Includes mainly maintenance costs and safety production costs.
Changes in stock level
Changes in stock level comprise the changes in the value of our inventory.
143
Co-operation partners costs
Co-operation partners costs comprise the share of prot which our co-operation partner is entitled upon
the sale of phosphate rocks from certain adits arising from the Dashan Arrangement. Please refer to the
section entitled General Information on our Group Mining Operations Co-operation arrangements
of this Offer Document for more details on this arrangement. The number of operating adits which were
included under the Dashan Arrangement in FY2010, FY2011 and FY2012 was one (1), one (1) and two
(2) adits respectively. For FP2013, the number of operating adits which were included under the Dashan
Agreement was two (2) adits compared to one (1) adit for FP2012.
Transportation costs
Transportation costs relate to expenses incurred in the transportation of the phosphate rocks from our
Mines to our Facilities. This is done through local transportation contractors engaged by our Group.
Materials and overheads
Materials and overheads comprise mainly costs of phosphate rocks, P
4
and thermal phosphoric acid
purchased from third parties to supplement our production and natural gas and electricity used in the
Chemical Production Operations.
Phosphate rocks, P
4
, thermal phosphoric acid
Where possible, we use phosphate rocks from our Mines as raw materials to produce P
4
, which is either
sold or used in the production of thermal phosphoric acid, which is in turn either sold or used in the
production of other phosphate-based chemical products such as STPP and SHMP.
In the event that we are not able to obtain phosphate rocks from our Mines or when our inventory of
phosphate rocks are depleted, we will purchase phosphate rocks from third party suppliers for use as raw
materials in the production of P
4
. Similarly, when our production of P
4
and/ or thermal phosphoric acid is
affected or when our inventory of P
4
and/ or thermal phosphoric acid is depleted, we will purchase our
supplies from third party suppliers. For example, immediately after the Wenchuan Earthquake, although
we were not able to obtain phosphate rocks from our Mines, as our Previous Hanwang Facilities had
the production facilities to produce P
4
, thermal phosphoric acid and other phosphate-based chemical
products, we purchased phosphate rocks, P
4
and thermal phosphoric acid from third parties to produce
STPP and SHMP.
However, in FY2012 and FP2013, our Group did not produce any P
4
as our P
4
plant at the New Gongxing
Site was still under construction.
Our Group was not reliant on any third party phosphate rocks, P
4
or thermal phosphoric acid suppliers
in the Period Under Review. Our Group had resumed our Mining Operations in FY2010, and once
construction of the new P
4
and thermal phosphoric acid plant are completed at the New Gongxing
Facilities, our Group will commence to manufacture our own P
4
and thermal phosphoric acid using our
own phosphate rocks.
Natural gas and electricity
Our Group purchases natural gas from local suppliers and electricity from the national grid for heating
and other production purposes of SHMP and STPP.
Direct labour
Our direct labour costs comprise salaries, social insurance contributions and other employee-related
expenses of miners, workers and employees involved in our Groups Mining Operations and Chemical
For the Period Under Review, we engaged third parties to provide local workers with relevant mining
experience for our Mining Operations during the periods when the Mines are in operation. This enabled
us to control labour costs and prevented us from incurring excessive salaries and wages especially
during months where there were little and/ or no Mining Operations.
144
Government taxes and fees
Government taxes and fees comprise resource tax, price adjustment fund and resource compensation
fee.
According to the (Interim Regulations of PRC on Resource Tax)
promulgated on 25 December 1993, effective as of 1 January 1994 and amended on 30 September
2011, any enterprise engaged in the exploitation of mineral products within the PRC is required to pay
a resource tax. Resource tax for phosphate rock is computed at RMB15 per tonne of phosphate rock
extracted.
Under the (Administrative Measures of Mianzhu
on the Collection and Use of Price Adjustment Fund of Phosphate Rocks of Mianzhu (for trial
implementation)), promulgated on 15 June 2012, enterprises and individuals who engage in phosphate
rock mining in Mianzhu shall pay the (price adjustment fund) at RMB30 per tonne of
phosphate rocks obtained.
According to the (Provisions on the Administration of the Collection
of Mineral Resources Compensation Fees) promulgated on 27 February 1994, effective as of 1 April
1994 and amended on 3 July 1997, mineral resources compensation fees shall be paid by the holder
of the mining right. The compensation fee is calculated using a pre-determined formula based on the
compensation fee rate (currently two per cent. (2%) for phosphorus), revenue derived from sale of the
minerals and the extract recovery rate.
Depreciation and amortisation
Our mining and exploration rights are amortised over the unexpired period of the rights on a straight-line
basis.
Equipment used in mining and exploration is depreciated over its useful life on a straight-line basis.
Depreciation for waste removal costs relating to our Mining Operations and plant and equipment relating
to our Chemical Production Operations is computed using the unit of production method.
Expenditures incurred to conduct drilling, geological and related exploration and evaluation studies
are capitalised. When technical feasibility and commercial viability of obtaining mineral resources are
demonstrable, such costs will be amortised over the unexpired period of the rights on a straight-line basis.
Others
Others comprise safety production costs for our Mines and Facilities, maintenance costs for roads,
equipment and machinery and other miscellaneous costs.
FACTORS AFFECTING OUR COSTS OF SALES
Our Groups cost of sales has historically been inuenced by the following key factors, which we believe
will continue to affect our Groups cost of sales in the future:
(a) Mining related costs
The main costs incurred in our Mining Operations include direct labour costs, transportation costs
and co-operation partners cost. The increase in any of such costs will lead to higher mining costs
for our Group. Our mining related costs are also affected by the composition of mining output from
prot-sharing and non prot-sharing adits.
145
(b) Market prices of raw materials
We require phosphate rocks for production of P
4
and thermal phosphoric acid for production of
SHMP and STPP. In the event that we are not able to obtain phosphate rocks from our Mines and/
or produce our own P
4
or thermal phosphoric acid, we will purchase these raw materials from third
parties. Phosphate rocks, P
4
and thermal phosphoric acid purchased from third parties may be of
inferior quality or higher costs, leading to an increase in our cost of production.
Market prices of other raw materials such as alkali, coke, soda ash, silica which our Group does
not produce, are largely affected by the market demand and supply and governmental policies in
the PRC.
(c) Government taxes and fees
In addition to the resource tax of RMB15 per tonne of phosphate rocks obtained, our Group
was required to pay the price adjustment fund and resource compensation fee of RMB30 and
RMB6 per tonne (calculated using a pre-determined formula based on the compensation fee
rate (currently two per cent. (2%) for phosphorus)) of phosphate rocks obtained, respectively.
An increase in any of such government taxes and fees will result in an increase in our cost of
production.
Other income
Other income comprise interest income from deposits, receipt of insurance claims, receipt of PRC
government subsidies, gain arising from the Facilities Relocation (the Facilities Relocation Gain), gain
on disposal of property, plant and equipment, reversal of accrued expenses which are no longer required
and sale of scrap materials.
Selling and distribution costs
Selling and distribution costs comprise promotion and advertising expenses, transportation expenses
incurred for the delivery of our nished goods to customers (such as truck, rail, sea and freight costs),
export related costs (including export duties and export insurance), storage fees and salaries and social
insurance contributions of employees who are involved in the selling and distribution activities of our
Group.
General and administrative costs
General and administrative costs comprise mainly of the following:
(a) depreciation of property, plant and machinery other than those used in the Mining Operations and
the Chemical Production Operations;
(b) salaries and social contributions of employees not involved in the Mining Operations and the
Chemical Production Operations;
(c) directors fees and remuneration;
(d) professional fees which include audit fees, legal services fees and professional fees for geological
consultations and assessments, as well as professional fees for listing preparation;
(e) insurance expenses;
(f) repair and maintenance, upkeep of property, plant and equipment and public maintenance
expenses; and
(g) other general ofce and administrative expenses, including ofce rental, transport costs, travelling
costs and entertainment expenses.
146
Other operating income
Other operating income relates to reversal of impairment loss on property, plant and equipment.
Finance costs
Finance costs comprise mainly interest and other costs incurred for bank borrowings.
It also includes interest on unwinding of provision for rehabilitation. Our Group records the present value
of estimated costs required to restore mining locations upon closure of the Mines (such as reclamation
and replanting works) and this obligation generally arises when assets are installed or work commences
at the mining locations. The present value of the provision for restoring the mining locations is capitalised
and the discounted liability is increased for the change in present value. The periodic unwinding of the
discount is recognised as nance costs.
Taxation
Taxation includes current tax expense and deferred tax expense. Current tax is expected tax payable on
the chargeable income. Deferred tax is a result of temporary differences between carrying amounts of
assets and liabilities for nancial accounting purposes and tax purposes. Deferred tax also includes the
recognition of unused tax losses and tax credits.
For the Period Under Review, the tax rate was 25% and 17% for PRC and Singapore companies
respectively. As our Group had accumulated tax losses for the Period Under Review, we did not pay any
corporate income tax for the Period Under Review.
REVIEW OF PAST OPERATING RESULTS
$000 % $000 % $000 % $000 % $000 %
Upstream Segment 357 12.9 1,496 33.1 3,700 75.6 607 60.5 969 74.0
Downstream Segment 2,418 87.1 3,026 66.9 1,197 24.4 397 39.5 341 26.0
2,775 100.0 4,522 100.0 4,897 100.0 1,004 100.0 1,310 100.0
Cost of Sales FY2010 FY2011 FY2012 FP2012 FP2013
$000 % $000 % $000 % $000 % $000 %
Upstream Segment 258 10.9 558 26.0 1,948 69.7 364 56.2 589 68.1
Downstream Segment 2,115 89.1 1,590 74.0 848 30.3 284 43.8 276 31.9
2,373 100.0 2,148 100.0 2,796 100.0 648 100.0 865 100.0
Gross Prot FY2010 FY2011 FY2012 FP2012 FP2013
$000 % $000 % $000 % $000 % $000 %
Upstream Segment 99 24.6 938 39.5 1,752 83.4 243 68.3 380 85.4
Downstream Segment 303 75.4 1,436 60.5 349 16.6 113 31.7 65 14.6
402 100.0 2,374 100.0 2,101 100.0 356 100.0 445 100.0
FY2010 FY2011 FY2012 FP2012 FP2013
Gross Prot Margin % % % % %
Upstream Segment 27.7 62.7 47.4 40.0 39.2
Downstream Segment 12.5 47.5 29.2 28.5 19.1
147
FY2010 vs FY2011
Revenue
Our Groups revenue increased by $1.7 million or 63.0% from $2.8 million in FY2010 to $4.5 million in
FY2011 with both segments contributed to this increase in revenue.
The increase in revenue from the Upstream Segment of $1.1 million or 319.0%, from $0.4 million in
FY2010 to $1.5 million in FY2011 was due mainly to an increase in the quantities of phosphate rocks
sold, which increased from approximately 4,600 tonnes in FY2010 to approximately 20,100 tonnes in
FY2011. We resumed our Mining Operations in FY2010 and as our Group increased Mining Operations
in FY2011, there were more phosphate rocks available for sale to third parties. Our average selling price
of the phosphate rocks was approximately RMB384 (or equivalent to $77 based on the exchange rate of
RMB4.975:S$1.00) per tonne and approximately RMB385 (or equivalent to $75 based on the exchange
rate of RMB5.163: S$1.00) per tonne in FY2010 and FY2011 respectively.
The increase in revenue from the Downstream Segment of $0.6 million or 25.1% from $2.4 million in
FY2010 to $3.0 million in FY2011 was contributed mainly by an increase in revenue derived from the
sale of STPP of $1.0 million which was partially offset by a reduction in revenue derived from the sale of
SHMP of $0.4 million in FY2011.
The increase in revenue derived from sale of STPP by $1.0 million or 53.5% from $1.9 million in FY2010
to $2.9 million in FY2011, was due mainly to the increase in orders from existing customers which
increased from approximately 1,300 tonnes in FY2010 to approximately 2,000 tonnes in FY2011, coupled
with an increase in the average selling price from approximately RMB6,878 (or equivalent to $1,382
based on the exchange rate of RMB4.975:S$1.00) per tonne in FY2010 to approximately RMB7,480 (or
equivalent to $1,449 based on the exchange rate of RMB5.163:S$1.00) per tonne in FY2011.
The decrease in revenue derived from sale of SHMP by $0.4 million or 68.8% from $0.5 million in
FY2010 to $0.2 million in FY2011 was due mainly to a reduction in the quantity sold. Our Group sold
approximately 400 tonnes of SHMP in FY2010 compared to approximately 100 tonnes in FY2011 due
mainly to loss of certain customers. The reduction in quantity sold was however mitigated by an increase
in average selling price from approximately RMB6,753 (or equivalent to $1,357 based on the exchange
rate of RMB4.975:S$1.00) per tonne in FY2010 to approximately RMB8,779 (or equivalent to $1,701
based on the exchange rate RMB5.163:S$1.00) per tonne in FY2011.
The increase in revenue from the PRC by $1.2 million or 94.7%, from $1.3 million in FY2010 to $2.4
million in FY2011 was largely due to the increase in revenue derived from sale of phosphate rocks of
$1.1 million as our phosphate rocks can only be sold in the PRC. The increase in revenue derived from
sales to the Philippines of $0.2 million or 225.3% from $0.1 million in FY2010 to $0.3 million in FY2011
was a result of an increase in sales to a customer based in the Philippines. The reduction of revenue
derived from sale to Switzerland of $0.1 million or 48.0% from $0.3 million in FY2010 to $0.1 million in
FY2011 was due to the loss of a customer from Switzerland.
Cost of Sales
Our Groups cost of sales reduced by $0.2 million or 9.5%, from $2.4 million in FY2010 to $2.1 million in
FY2011, due mainly to a stock take gain of $1.0 million. The stock take gain arose as Mianzhu Norwest
prepared for the relocation of STPP plant to New Gongxing Facilities and was able to remove all residual
STPP powder which had attached to the walls of the warehouse silos that had accumulated over the
years and had been included as part of the manufacturing costs in previous periods (the Relocation
Stock Take Gain). The value of the residual STPP powder recovered and gain from our routine stock
take for phosphate rocks was recognised as stock take gain in cost of goods sold in FY2011. In FY2010,
the stock take gain was $0.04 million.
The increase in co-operation partners cost, transportation costs and direct labour by $0.3 million, $0.3
million and $0.4 million respectively in FY2011 was in line with the increase in the quantity of phosphate
rocks obtained from our Mines in FY2011.
148
The increase in cost of materials and overheads by approximately $0.6 million was in line with the
increase in sale of STPP.
Gross prot margin
The increase in gross prot margin from 14.5% in FY2010 to 52.5% in FY2011 was due mainly to a
change in sales mix in FY2011. Our Group sold more phosphate rocks which generally have higher gross
prot margins compared to phosphate-based chemical products in FY2011. Revenue derived from the
sale of phosphate rocks increased from 12.9% of total revenue in FY2010 to 33.1% of the total revenue
in FY2011. In addition, the Downstream Segment also contributed to the increase in gross prot margin
as a result of the increase in average selling prices of the phosphate-based chemical products in FY2011.
The improvement in gross prot margin was also due to the recognition of stock take gain in FY2011.
Gross profit margin from our Upstream Segment increased from 27.7% in FY2010 to 62.7% in
FY2011 due mainly to the recognition of stock take gain in FY2011. Without taking into account the
stock take gain, gross prot margin for our Upstream Segment in FY2011 would have been 37.8%.
This improvement in gross prot margin was due mainly to lower cost of production arising from better
efciency and economies of scale as we increased our Mining Operations in FY2011.
Gross prot margin from our Downstream Segment increased from 12.5% in FY2010 to 47.5% in
FY2011. Without taking into account of the stock take gain, gross margin for our Downstream Segment in
FY2011 was 27.0%. This improvement in gross prot margin was due mainly to the increase in average
selling prices of our phosphate-based chemical products in FY2011.
Other income
The increase in other income of $1.6 million or 158.4% from $1.0 million in FY2010 to approximately $2.5
million in FY2011 was due mainly to:
(i) recognition of gain on receipt of Facilities Relocation Gain of $1.9 million in FY2011. In FY2011,
our Group received the rst portion of the relocation income of approximately $3.3 million, wrote
off the cost of land use rights of our Previous Hanwang Facilities of $0.8 million, incurred relocation
expenses of $0.6 million and recognised the resultant gain of $1.9 million;
(ii) increase in reversal of accrued expenses which were no longer required of $0.1 million; and
(iii) increase in gain in disposal of property, plant and equipment of $0.1 million,
which was partially offset by the absence of any insurance claims in FY2011 (compared to the insurance
claims of $0.4 million in FY2010).
The increase in selling and distribution costs of $0.1 million or 13.4% from $0.4 million in FY2010 to $0.5
million in FY2011 was due mainly to the increase in transportation costs of $0.1 million arising from the
increase in quantity of STPP sold in FY2011.
The decrease in general and administrative costs of $1.3 million or 45.8% from $2.7 million in FY2010 to
$1.5 million in FY2011 was due mainly to:
(i) the decrease in professional fees of $0.6 million. In FY2010, our Group incurred professional fees
for valuation, technical and geologist reports prepared for the purposes of its fund raising exercise;
(ii) the write-back of bad debts previously written off of $0.3 million. In FY2011, our management
renegotiated for the partial repayment of long outstanding advances to certain mining contractors;
and
149
(iii) reduction in operating costs such as travelling and entertainment costs and repairs and
maintenance costs by $0.1 million and $0.1 million respectively as our Group was able to contain
such expenses in FY2011,
which was partially offset by an increase in salaries and related costs by $0.1 million arising from salary
adjustments and the recruitment of two (2) senior management personnel in FY2011.
Other operating income
In FY2010, after considering the general rising trend in metal prices, our Group reassessed the
recoverable amount of certain plant and machinery that were previously impaired with reference to
the fair values less costs to sell based on publicly available information on metal prices. As a result,
impairment loss previously recognised of $0.6 million was written back.
Finance costs
Finance costs reduced by $0.04 million or 82.7% from $0.05 million in FY2010 to $0.01 million in FY2011
due to the repayment of all outstanding interest-bearing bank loans in FY2011.
Taxation
In FY2010, our Group recognised a taxation benet of $0.03 million arising from the reversal of taxable
temporary differences.
No taxation was paid by our Group in FY2011 as we beneted from previously unrecognised tax losses.
FY2011 vs FY2012
Revenue
Revenue increased by $0.4 million or 8.3% from $4.5 million in FY2011 to $4.9 million in FY2012.
The increase in revenue derived from our Upstream Segment of $2.2 million or 147.3% from $1.5
million in FY2011 to $3.7 million in FY2012 was due to an increase in the quantity of phosphate rocks
sold which increased from approximately 20,100 tonnes in FY2011 to approximately 42,100 tonnes in
FY2012. As our Group further increased our Mining Operations in FY2012, there were more phosphate
rocks available for sale to third parties in the PRC. Furthermore, as we were no longer operating in our
Previous Hanwang Facilities and our New Gongxing Facilities were not ready for production, we did not
require any phosphate rocks for our Downstream Segment. The increase in average selling price of the
phosphate rocks in FY2012 which rose from approximately RMB385 (or equivalent to $75 based on the
exchange rate of RMB5.163:S$1.00) per tonne in FY2011 to approximately RMB445 (or equivalent to $88
based on the exchange rate of RMB5.058:S$1.00) per tonne in FY2012 also contributed to the increase
in revenue derived from our Upstream Segment.
The above increase in revenue derived from our Upstream Segment was offset by a reduction in revenue
derived from our Downstream Segment of $1.8 million or 60.4% from $3.0 million in FY2011 to $1.2
million in FY2012. The reduction in revenue derived from our Downstream Segment was due to reduction
in revenue derived from the sale of STPP by $1.9 million or 66.2% from $2.9 million in FY2011 to $1.0
million in FY2012.
The above reduction in revenue derived from sale of STPP was due to a decrease in the quantity
sold, from approximately 2,000 tonnes in FY2011 to approximately 600 tonnes in FY2012. As our New
Gongxing Facilities were not ready for production in FY2012, we have limited quantities of balance
inventory of STPP for sale. As such, we were more selective in our customer base in FY2012, hence
leading to reduction in quantity sold. The reduction in quantity sold was mitigated by an increase in
average selling price of STPP from approximately RMB7,480 (or equivalent to $1,449 based on the
exchange rate of RMB5.163:S$1.00) per tonne in FY2011 to approximately RMB8,011 (or equivalent to
$1,584 based on the exchange rate of RMB5.058:S$1.00) per tonne in FY2012.
150
Revenue derived from sale of SHMP remained around $0.2 million in FY2011 and FY2012, as the
quantity of SHMP sold remained approximately 100 tonnes. This was partially offset by a decrease in
the average selling price of SHMP from approximately RMB8,779 (or equivalent to $1,701 based on the
exchange rate of RMB5.163:S$1.00) per tonne in FY2011 to approximately RMB8,535 (or equivalent to
$1,687 based on the exchange rate of RMB5.058:S$1.00) per tonne in FY2012.
We recorded an increase in revenue derived from the PRC of $1.9 million or 78.7%, from $2.4 million in
FY2011 to $4.4 million in FY2012 due mainly to the increase in revenue derived from sale of phosphate
rocks which can only be sold within the PRC of $2.2 million, offset by a reduction in revenue derived from
sale of STPP in the PRC of $0.5 million in FY2012 due to the aforementioned reasons. The decline in
sale derived from the Philippines and the absence of any sale to United States of America, Switzerland
and Vietnam was due to the limited quantities of phosphate-based chemical products sold outside of the
PRC. The increase in sales to New Zealand was due to increase in phosphate-based chemical products
sold to a customer.
Cost of goods sold
Cost of goods sold increased by $0.6 million or 30.2% from $2.1 million in FY2011 to $2.8 million in
FY2012 due mainly to the increase in quantities of phosphate rocks obtained and sold from our Mines
which resulted in:
( a) a corresponding increase in co-operation partners costs of $0.3 million, transportation costs of
$0.3 million, direct labour of $0.2 million; and
( b) an increase in government taxes and fees of $0.4 million. In addition to resource tax and resource
compensation fees incurred, new government fees such as the price adjustment fund at RMB30
per tonne of phosphate rocks obtained from our Mines also led to the increase in government
taxes and fees;
which was partially offset by:
(i) the reduction in materials and overheads costs of $1.6 million as our New Gongxing Facilities were
not ready for production; and
(ii) decline in change in stock level of $0.9 million arising from the absence of the Relocation Stock
Take Gain in FY2012.
Gross prot margin
Gross prot margin from our Upstream Segment declined from 62.7% in FY2011 to 47.4% in FY2012
and gross prot margin from our Downstream Segment declined from 47.5% in FY2011 to 29.2%
in FY2012 resulting in an overall decline in our gross prot margin from 52.5% in FY2011 to 42.9% in
FY2012. This decline in gross prot margin was due to the absence of the Relocation Stock Take Gain
in FY2011. Without taking into account this recognition of Relocation Stock Take Gain, the gross prot
margin for our Upstream Segment would have recorded an increase from 37.8% in FY2011 to 47.4%
in FY2012 while the gross prot margin for our Downstream Segment would have recorded an increase
from 27.0% in FY2011 to 29.2% in FY2012.
The increase in the gross profit margin for our Upstream Segment (without taking into account
recognition of stock count gain) was due to the increase in average selling price and quantities of
phosphate rocks sold in FY2012.
The increase in the gross prot margin for our Downstream Segment (without taking into account
recognition of stock count gain) was due mainly to the increase in average selling prices of STPP in
FY2012.
151
Other income
Increase in other income of $1.0 million or 39.6% from $2.5 million in FY2011 to $3.5 million in
FY2012 was due mainly to the increase in recognition of gain on receipt of Facilities Relocation Gain
of $1.6 million, from $1.9 million in FY2011 to $3.5 million in FY2012, partially offset by the absence
of any reversal of accrued expenses in FY2012 and sale of scrap materials in FY2012. In FY2011, we
recognised reversal of accrued expenses of $0.4 million and sale of scrap materials of $0.1 million.
In FY2012, our Group received the second portion of the Facilities Relocation Gain and after deducting
relocation costs of $0.05 million, recognised a gain of $3.5 million.
Selling and distribution costs reduced by $0.3 million or 53.0% from $0.5 million in FY2011 to $0.2 million
in FY2012. The reduction in selling and distribution costs was due mainly to reduction in transportation
costs of $0.2 million arising from the lower quantities of phosphate-based chemical products sold in
FY2012.
General and administrative costs increased by $2.4 million or 162.7% from $1.5 million in FY2011 to $3.9
million in FY2012 due mainly to:
(i) increase in foreign exchange loss of $0.2 million. Mianzhu Norwest had foreign currency exposure
arising from the SGD shareholders loan granted by Norwest Chemicals. These foreign currency
gains or losses are not eliminated at our Groups level;
(ii) professional fees incurred in the preparation work for the Invitation of approximately $1.8 million.
There were no such professional fees in FY2011; and
(iii) lower amount of write-back of bad debts previously written off. The write-back of bad debts
previously written off was $0.3 million in FY2011. There was no write back of bad debts in FY2012.
Finance Cost
In FY2012, our Group had no interest-bearing loans. The nance cost incurred in FY2012 was due to the
interest on unwinding of provision for rehabilitation.
Taxation
In FY2012, our Group recorded deferred taxation of $0.3 million being the temporary differences between
carrying amounts of assets and liabilities for nancial accounting and tax purposes, after adjusting for
benets from previously unrecognised tax losses. Our Groups effective tax rate was 18.8%.
FP2012 vs FP2013
Revenue
Revenue increased by $0.3 million or 30.5% from $1.0 million in FP2012 to $1.3 million in FP2013.
The revenue derived from our Upstream Segment increased by $0.4 million or 59.6% from $0.6 million
in FP2012 to $1.0 million in FP2013 due to an increase in the quantity of phosphate rocks sold which
increased from approximately 7,000 tonnes in FP2012 to approximately 12,200 tonnes in FP2013. As our
Group further increased our mining activities in FP2013, there were more phosphate rocks available for
sale to third parties in the PRC. However, with the P
4
plant expected to commence production in FY2013,
our Group selected better quality phosphate rocks to be kept as inventory for subsequent use in its P
4

production and sold the lower quality phosphate rocks which generally fetch lower prices. Therefore, the
increase in quantities sold was offset by the reduction in average selling price of the phosphate rocks in
FP2013 which reduced from approximately RMB431 (or equivalent to S$86 based on the exchange rate
of RMB5.000:S$1.00) per tonne in FP2012 to approximately RMB405 (or equivalent to $80 based on the
exchange rate of RMB5.081:S$1.00) per tonne in FP2013.
152
Revenue derived from our Downstream Segment marginally declined by $0.1 million or 14.1%, from
$0.4 million in FP2012 to $0.3 million in FP2013 mainly due to a similar decline in revenue derived from
sale of STPP. Despite selling approximately 200 tonnes of STPP in both FP2012 and FP2013, there
was a reduction in average selling price for STPP from RMB8,203 (or equivalent to $1,641 based on
the exchange rate of RMB5.000:S$1.00) in FP2012 to RMB7,666 (or equivalent to $1,509 based on the
exchange rate of RMB5.081:S$1.00) in FP2013.
Revenue derived from sale of SHMP remained at $0.1 million in FP2012 and FP2013, as the marginal
decline in quantity of SHMP sold was offset by the marginal increase in the average selling price from
RMB7,794 (or equivalent to $1,559 based on the exchange rate of RMB5.000:S$1.00) in FP2012 to
RMB8,724 (or equivalent to $1,717 based on the exchange rate of RMB5.081:S$1.00) in FP2013.
We recorded an increase in revenue derived from the PRC of $0.3 million or 34.9%, from $0.9 million in
FP2012 to $1.2 million in FP2013 due mainly to the increase in revenue derived from sale of phosphate
rocks which can only be sold within the PRC. In FP2013, we did not sell to any customers in the
Phillippines but managed to sell to a customer in Spain.
Cost of goods sold
Cost of goods sold increased by $0.2 million or 33.5% from $0.6 million in FP2012 to $0.9 million in
FP2013 due mainly to:
(i) increase in quantities of phosphate rocks extracted and sold from our Mines which resulted in a
corresponding increase in co-operation partners costs of $0.1 million, direct labour of $0.3 million
and transportation costs of $0.1 million; and
(ii) introduction of the price adjustment fund effective from July 2012 which led to the increase in
government taxes and fees of $0.2 million,
which was partially offset by decrease in changes in stock level of $0.5 million.
Our Groups mining activities resumed in March 2013 and it was able to mine more phosphate rocks in
March 2013 compared to March 2012. Furthermore, our Group had adopted the strategy to keep better
quality phosphate rocks as inventory for subsequent use in its P
4
production and only sold the lower
quality phosphate rocks. This resulted in our Group recording a decrease in changes in stock level.
Gross prot margin
Gross prot margin from our Upstream Segment marginally declined from 40.0% in FP2012 to 39.2% in
FP2013 and gross prot margin from our Downstream Segment declined from 28.5% in FP2012 to 19.1%
in FP2013 resulting in an overall decline in our gross prot margin from 35.5% in FP2012 to 34.0% in
FP2013.
The marginal decline in the gross prot margin for both our Upstream Segment and Downstream
Segment was due mainly to the decrease in the average selling prices of phosphate rocks and STPP
in FP2013 as compared to FP2012. In addition we incurred higher labour costs in FP2013 for our STPP
sales due to the manual selection process for certain batches of STPP which resulted in the increase in
average cost of sales for STPP sold in FP2013.
Other income
The decrease in other income of $1.4 million or 99.4% from $1.4 million in FP2012 to $0.01 million in
FP2013 was due mainly to the absence of the Facilities Relocation Gain of $1.3 million in FP2013.
Selling and distribution costs marginally increased by $0.03 million or 64.2% from $0.05 million in FP2012
to $0.09 million in FP2013 due mainly to the increase in transportation related costs.
153
General and administrative costs increased by $0.6 million or 126.0% from $0.5 million in FP2012 to $1.1
million in FP2013 due mainly to:
(i) professional fees incurred in the preparation work for the Invitation of approximately $0.4 million.
There were no such professional fees in FP2012; and
(ii) increase in salaries and directors remuneration by $0.1 million arising from the terms of the
Service Agreements coming into effect.
Finance Cost
The increase in nance cost was mainly due to interest incurred on a bank loan in FP2013. In FP2012,
our Group had no interest-bearing loans.
The nance cost in FP2012 and FP2013 also included interest on unwinding of provision for rehabilitation
of $0.01 million incurred in each of the nancial periods.
Taxation
In FP2012 and FP2013, our Group had no taxable income and did not make provision for income tax.
REVIEW OF PAST FINANCIAL POSITION OF OUR GROUP
A review of our nancial position based on the combined balance sheets of our Group is set out below:
Non-current assets
As at 31 December 2012
Non-current assets stood at $33.2 million and accounted for 76.1% of total assets. Non-current assets
comprise mine properties, land use rights, property plant and equipment and prepayments.
Mine properties comprise mining rights and evaluation and exploration expenditures and amounted to
$0.7 million or 2.0% of total non-current assets. Land use rights refer to our 50-year leasehold land in
Phase 1 of the New Gongxing Site which amounted to $1.6 million or 4.9% of total non-current assets.
Property, plant and equipment comprise (i) leasehold buildings at our Mines and our Facilities and
improvements thereto; (ii) plant and machinery at our Mines and Facilities; (iii) motor vehicles and ofce
equipment; (iv) mining infrastructure and (iv) construction-in-progress, and amounted to $28.8 million or
86.7% of total non-current assets. Prepayments arises from the initial payment for our land use right in
respect of Phase 2 of the New Gongxing Site and the Hanwang Land and certain property, plant and
equipment which amounted to $2.1 million or 6.3% of total non-current assets.
As at 31 March 2013
Non-current assets reduced by $0.3 million or 0.9% from $33.2 million as at 31 December 2012 to $32.9
million as at 31 March 2013 due mainly to depreciation of property, plant and equipment and amortisation
of mine properties.
Current assets
Total current assets stood at $10.4 million and accounted for 23.9% of total assets. Total current assets
comprise:
(i) our phosphate rocks and packaging materials, raw materials and nished products in respect of
our phosphate-based chemical products, which accounted for $2.9 million or 27.9% of total current
assets;
(ii) trade receivables which amounted to $0.1 million or 1.3% of total current assets;
154
(iii) other receivables amounted to $1.8 million or 16.8% of total current assets and comprise (a)
refundable deposits; (b) amount due from a director-related company; and (c) amount from the
recognition of certain batches of STPP produced as part of the testing process of the STPP plant;
(iv) deferred expenses which amounted to $0.3 million or 3.3% of total current assets being portion of
the incremental costs (such as professional fees) that are directly attributable to the issuance of
new shares arising from the Invitation;
(v) prepayments which amounted to $0.5 million or 4.7% of total current assets and comprise
advances to suppliers and other prepayments; and
(vi) cash and bank balances which amounted to $4.8 million or 45.9% of total current assets and
includes pledged deposits of $0.2 million for our Mining Operations. The xed deposits were
pledged with a bank in compliance with the notice jointly issued by the Mianzhu Finance Bureau,
the Mianzhu Safety Bureau and Bank of China Limited, Mianzhu Branch in relation to the operation
of our Mines.
As at 31 March 2013
Current assets reduced by $0.9 million or 8.2% from $10.4 million as at 31 December 2012 to $9.5
million as at 31 March 2013. This was due mainly to the reduction in cash and bank balances of $1.6
million utilised to fund our Groups working capital requirements. The reduction was partially mitigated by
increase in:
(i) stocks of $0.4 million due to our Groups strategy to keep better quality phosphate rocks as
inventory for subsequent use in its P
4
production; and
(ii) trade receivables of $0.3 million due to outstanding receivables from customers and promissory
note from a customer due to mature in June 2013.
Total non-current liabilities of $2.7 million accounted for 18.1% of total liabilities and comprise deferred
tax liabilities, deferred income and provision for rehabilitation of $0.3 million, $2.2 million and $0.2 million
respectively.
Deferred tax liabilities arise from temporary differences between carrying amounts of assets and
liabilities for nancial accounting purposes and tax purposes after recognising benets from previously
unrecognised tax losses.
Deferred income represents government grants received in FY2010 for construction of the P
4
plant at the
New Gongxing Facilities. Deferred income will be recognised as other income over the expected useful
life of the P
4
plant when construction of the plant is completed and capable of operating in the manner
intended by our Group. As at 31 December 2012, the P
4
plant was not commercially operational.
Provision for rehabilitation represents the present value of estimated costs required to restore mining
locations upon closure of the Mines.
As at 31 March 2013
Non-current liabilities marginally increased by $0.05 million from $2.7 million as at 31 December 2012 to
$2.8 million as at 31 March 2013.
155
Current liabilities
Current liabilities stood at $12.3 million and accounted for 81.9% of total liabilities. Current liabitities
comprise:
(i) trade payables of $1.3 million or 10.6% of total current liabilities;
(ii) other payables of $10.2 million or 82.9% of total current liabilities consisting of amounts payable for
taxes other than income tax, payroll and welfare payable, property plant and equipment, deposits
received, accrued liabilities and incidental costs in relation to the Facilities Relocation;
(iii) advances from customers of $0.1 million or 1.2% of total current liabilities; and
(iv) amounts due to ultimate holding company of $0.6 million representing 5.3% of total current
liabilities being advances made for working capital purposes and our Rebuilding Programme.
As at 31 March 2013
Current liabilities reduced by $2.7 million or 21.7% from $12.3 million as at 31 December 2012 to $9.6
million as at 31 March 2013 due mainly to the reduction in:
(i) trade payables of $0.5 million due to repayments made by our Group;
(ii) other payables of $2.4 million due mainly to repayments made by our Group for its property, plant
and equipment which was partially offset by the increase in deposits received from contractors
engaged for our Mining Operations and increase in government taxes and fees arising from the
introduction of the price adjustment fund effective from July 2012;
(iii) advances from customers of $0.1 million; and
(iv) amounts due to ultimate holding company of $0.6 million as the amount was capitalised in FP2013,
partially set off by a new interest-bearing bank loan of $1.0 million obtained from a PRC bank in FP2013.
Equity attributable to owners of the Company amounted to $28.6 million and comprise share capital,
foreign currency translation reserve and accumulated losses of approximately $32.5 million, $1.1 million
and $5.0 million respectively.
Foreign currency translation reserve represents the difference arising from translation of the nancial
statements of our PRC based subsidiary whose functional currency of RMB is different from that of our
Groups presentation currency, being S$.
In accordance with the Notice regarding safety production expenditure jointly issued by the Ministry of
Finance and the State Administration of Work Safety of the PRC in February 2012, the PRC subsidiary
is required to make appropriation to a safety fund surplus reserve based on the volume of mineral rocks
obtained. The reserve is utilised upon incurrence of specic safety production expense. In FY2012, we
transferred $46,000 to the safety fund surplus reserve and utilised the same amount in the same nancial
year.
156
As at 31 March 2013
Equity attributable to owners of the Company increased by $1.5 million or 5.1% from $28.6 million as at
31 December 2012 to $30.1 million as at 31 March 2013. This was mainly due to the increase in share
capital arising from the capitalisation of amounts due to ultimate holding company of $0.6 million and
issue of new shares for cash consideration of $1.2 million, which was partially offset by the decrease
in reserves of $0.4 million. The decrease in reserves was due to the increase in accumulated losses of
$0.7 million which was partially offset by increase in foreign currency translation reserve of $0.4 million.
LIQUIDITY AND CAPITAL RESOURCES
Relocation Exercise, and assets and other forms of investments by Dashan, one (1) of our third party
co-operation partners. As at 31 December 2012, we had no bank borrowings and our cash and cash
equivalents was $4.6 million. As at 31 March 2013, our bank borrowings amounted to $1.0 million and our
cash and cash equivalents was $3.0 million.
Please refer to the section entitled Capitalisation and Indebtedness - Borrowings of this Offer Document
for further information on our banking facilities.
For the Period Under Review, our principal uses of cash have been for working capital requirements and
nancing of our capital expenditure.
We recorded negative working capital position of $3.0 million, $3.7 million, $1.9 million and $0.06
million as at 31 December 2010, 2011, 2012 and 31 March 2013 respectively, due mainly to the capital
expenditure incurred mainly in respect of the construction of P
4
plant and the outstanding shareholders
loan taken to part nance the cost of the Rebuilding Programme.
To the best of our Directors knowledge, we are not in breach of any of the terms and conditions or
covenants associated with any credit arrangement or bank facilities which could materially affect our
nancial position and results of business operations or the investment by our owners.
The following table sets forth a summary of our Groups audited combined statements of cash ow for
FY2010, FY2011 and FY2012 and unaudited combined statement of cash ow for FP2013. The summary
combined statements of cash ow should be read in conjunction with the full text of this Offer Document,
including the section entitled Selected Combined Financial Information of this Offer Document and
Appendix A and Appendix B entitled the Audited Combined Financial Statements for the nancial years
ended 31 December 2010, 2011 and 2012 and Unaudited Interim Condensed Combined Financial
Statements for the three months period ended 31 March 2013 to this Offer Document respectively.
Audited Audited Audited Unaudited
FY2010 FY2011 FY2012 FP2013
($000)
Net cash ows generated from/(used in) operating activities 828 (207) (1,591) (1,549)
Net cash ows used in investing activities (3,859) (9,664) (5,757) (1,758)
Net cash ows generated from nancing activities 3,050 12,303 8,815 1,888
Net increase/(decrease) in cash and cash equivalents 19 2,432 1,467 (1,419)
Cash and cash equivalents at beginning of the year/ period 839 824 3,047 4,613
Effect of exchange rate changes on cash and cash equivalents (34) (209) 99 (179)
Cash and cash equivalents at end of year/period 824 3,047 4,613 3,015
For the purpose of cash ow statement, cash and cash equivalents comprise:
Less pledged xed deposits (159) (166) (159) (162)
Cash and cash equivalents 824 3,047 4,613 3,015
157
The xed deposits were pledged with a bank in compliance with the notice jointly issued by the Mianzhu
Finance Bureau, the Mianzhu Safety Bureau and Bank of China Limited, Mianzhu Branch in relation to
the operation of our Mines.
FY2010
In FY2010, our Group recorded net cash ows generated from operating activities of $0.8 million which
was mainly a result of working capital inows of $2.4 million, offset by operating loss before working
capital changes of $1.6 million. Working capital inows were due mainly to decrease in stocks of $1.0
million arising from the selling down of phosphate-based chemical products and decrease in receivables
of $1.4 million arising from a reduction in advances paid to suppliers as well as increase in payables of
$0.1 million.
Our Group recorded net cash ow used in investing activities of $3.9 million due mainly to payments
made for purchase of property, plant and equipment which amounted to $1.2 million and payments made
in advance for land use rights at our New Gongxing Facilities and property, plant and equipment which
amounted to $2.3 million and $0.4 million respectively.
We recorded net cash ows generated from nancing activities of $3.1 million due mainly to net proceeds
from bank loans, receipt of government grant for construction of certain plant and equipment and
additional shareholders loan from ultimate holding company of approximately $0.4 million, $2.3 million
and $0.3 million respectively.
At 31 December 2010, the cash and cash equivalents excluding pledged xed deposits was $0.8 million.
FY2011
In FY2011, our Group recorded net cash ows used in operating activities of $0.2 million, despite
recording an operating prot before working capital changes of $1.3 million, mainly a result of working
capital outows of $1.5 million. Working capital outows were due to increase in stocks and receivables of
$0.9 million and $0.4 million respectively as well as decrease in payables of $0.1 million.
The increase in stock was due to our Groups increase in Mining Operations in FY2011 after we resumed
our Mining Operations in late FY2010. At 31 December 2011, we had accumulated stocks as our Mining
Operations would temporarily cease in the winter season and our Group was relocating from the Previous
Hanwang Facilities to the New Gongxing Facilities. The increase in receivables was due mainly to a
deposit of $0.3 million paid to a natural gas supplier to supply natural gas to our Facilities. These were
partly nanced by the proceeds of the issuance of new shares in Norwest Chemicals.
Our Group recorded net cash ows used in investing activities of $9.7 million due to payments made
for purchase of property, plant and equipment amounting to $10.3 million, payments made in advance
for land use rights at Gongxing Town and certain property, plant and equipment of $1.0 million and $1.8
million respectively and payments of $0.1 million made for incidental costs in relation to the relocation
of our STPP plant from the Previous Hanwang Facilities to the New Gongxing Facilities. This was offset
by proceeds received from disposal of property, plant and equipment and Facilities Relocation Gain of
approximately $0.3 million and $3.3 million respectively.
We recorded net cash ows generated from nancing activities of $12.3 million due mainly to proceeds
from issue of new shares in Norwest Chemicals of $12.0 million and shareholders loan received from
ultimate holding company of $1.5 million. This was offset by the repayment of bank loans and payments
incurred in relation to the Invitation of $0.9 million and $0.2 million respectively.
158
FY2012
In FY2012, our Group recorded net cash ows used in operating activities of $1.6 million despite
achieving an operating prot before working capital changes of $0.3 million due mainly to increase in
working capital outow of $1.9 million. The working capital outows were due mainly to the decrease in
payables of $1.5 million and increase in receivables of $0.3 million.
The decrease in payables was due to repayments by our Group during the nancial year while the
increase in receivables was due mainly to increase in advances to suppliers and other prepayments. This
was partly nanced through loans and capital injections from Eastcomm.
Our Group recorded net cash ows used in investing activities of $5.8 million due mainly to payments
made for purchase of property, plant and equipment totalling $8.2 million and payment of $0.5 million
made for incidental costs in relation to the relocation of our STPP plant from the Previous Hanwang
Facilities to the New Gongxing Facilities. Our Group also made advance payment for land use rights for
the Hanwang Land of $0.5 million. The cash ows used in investing activities was offset by proceeds from
receipt of the second portion of Facilities Relocation Gain of $3.5 million.
received from the issuance of new shares of $11.5 million which was offset by partial repayment of loan
from ultimate holding company and payment of expenses incurred in relation to the Invitation of $1.4
million and $1.3 million respectively.
FP2013
In FP2013, our Group recorded net cash ows used in operating activities of $1.5 million due mainly to
operating loss before working capital changes of $0.2 million and the increase in working capital outows
of $1.4 million. The increase in working capital outows was due to:
(i) increase in stocks of $0.3 million due to our Groups strategy to keep better quality phosphate
rocks as inventory for subsequent use in its P
4
production;
(ii) increase in receivables of $0.2 million due to increase in trade receivables; and
(iii) decrease in payables of $0.9 million arising from repayments made.
Our Group recorded net cash ows used in investing activities of $1.8 million due to payments made for
the purchase of property, plant and equipment mainly for the Rebuilding Programme.
from bank loan and issuance of new shares in Norwest Chemicals of $1.0 million and $1.2 million
respectively which was partially offset by payment of expenses incurred in relation to the Invitation of $0.3
million.
At 31 March 2013, the cash and cash equivalents excluding pledged xed deposits was $3.0 million.
CAPITAL EXPENDITURES, DIVESTMENTS AND COMMITMENTS
Our capital expenditure was incurred in the PRC mainly for the construction of the New Gongxing
Facilities and the restoration of adits at our Mines. The purchases or construction of such assets were
nanced mainly by issuance of shares, shareholders loans from ultimate holding company, PRC
authorities investment subsidy, proceeds from the Facilities Relocation Gain and to a lesser extent cash
ow generated from operations.
159
During the Period Under Review, our capital expenditure and divestments were as follows:
Audited
FY2010
Audited
FY2011
Audited
FY2012
Unaudited
FP2013
1 April 2013
to the Latest
Practicable
Date
$000 $000 $000 $000 $000
Capital expenditure
Leasehold buildings 843 202 223
Plant and machinery 245 493 261 70 159
Motor vehicles and ofce equipment 26 365 77 1 2
Mining infrastructure 55 492 91 572
Construction in progress 584 12,617 12,616 793 1,249
Land use rights 1,674
Mine properties 30
Total 1,753 15,351 13,699 955 1,982
Divestments
(1)
/Impairment/
(Write-back of impairment)
Leasehold buildings 42
Plant and machinery (633) 41
Motor vehicles and ofce equipment 1
Construction in progress 105
Land use rights 801
Total (633) 989 1
Note:
(1) Divestments are computed based on net book value.
In FY2010, after considering the general rising trend in metal prices, our Group reassessed the
recoverable amount of certain plant and machinery that were previously impaired with reference to the
fair value less costs to sell based on publicly available information on metal prices. As a result, an amount
of impairment loss previously recognised of $0.6 million was written back.
Save as disclosed above and in the sections entitled General Information on our Group Business
Overview, General Information on our Group Prospects and Trend Information, General Information
on our Group Business Strategies and Future Plans and Capitalisation and Indebtedness of this Offer
Document, we do not have other outstanding material commitments on capital expenditures, divestments
and commitments as at the Latest Practicable Date.
FOREIGN EXCHANGE MANAGEMENT
Our key operations are in Singapore and the PRC. Our revenue is primarily denominated in RMB and
USD. Our Group has exposure to foreign exchange risk as a result of transactions denominated in a
currency other than the respective functional currencies of our Groups entities.
160
ACCOUNTING TREATMENT OF FOREIGN CURRENCIES
Our Groups combined nancial statements are presented in S$ which is also our Companys functional
currency.
Transactions in foreign currencies are measured in the respective functional currencies of our Company
and its subsidiaries and are recorded on initial recognition in the functional currencies at the exchange
rates approximating those ruling at the transaction dates. Monetary assets and liabilities denominated in
foreign currencies are translated at exchange rate ruling at the balance sheet date. Non-monetary items
that are measured in terms of historical cost in a foreign currency are translated using the exchange rates
as at the dates of the initial transactions. Non-monetary items measured at fair value in a foreign currency
are translated using the exchange rates at the date when the fair value was determined.
Exchange differences arising on the settlement of monetary items or on translating monetary items at
the balance sheet date are recognised in income statement except for exchange difference arising on
monetary items that form part of our Groups net investment in foreign operations, which are recognised
initially in other comprehensive income and accumulated under foreign currency translation reserve in
equity. The foreign currency translation reserve is reclassied from equity to income statement of our
Group on disposal on the foreign operation.
For consolidation purposes, the assets and liabilities of foreign operations are translated into S$ at
the rate of exchange ruling at the balance sheet date and their statement of comprehensive income
are translated at the average exchange rates for the year/ period. The exchange differences arising on
translation are taken directly to other comprehensive income. On disposal of a foreign operation, the
component of other comprehensive income relating to the foreign operation is recognised in income
statement.
Foreign currency exposure
Our Group has transactional currency exposures arising from sales or purchases that are denominated
in currencies other than the respective functional currencies of our Groups entities, primarily, S$ and
RMB. For FY2010, FY2011, FY2012, FP2012 and FP2013, approximately 54.7%, 45.9%, 10.7%, 12.1%
and 9.1% respectively of our Groups sales were denominated in USD whilst almost 100% of costs were
denominated in the respective functional currencies of our Groups entities for FY2010, FY2011, FY2012,
FP2012 and FP2013.
Our Group does not consider that it has any signicant exposure to the risk of uctuation in the exchange
rate between RMB against USD, as a possible change of 5% in RMB against USD would have no
signicant nancial impact to our Groups nancial performance for the Period Under Review.
Our Groups exposure to the risk of changes in foreign exchange rates relates primarily to cash and bank
balances and S$ denominated loan due from our PRC subsidiary.
Our Group is also exposed to currency translation risk arising from our PRC subsidiary whose functional
currency of RMB is different from that of our Groups presentation currency, being S$. Our Groups net
investment in the PRC is not hedged as currency positions in RMB are considered to be long-term in
nature. Such translation gains/losses are of unrealised nature and do not impact current year prots
unless the underlying assets or liabilities of the subsidiary are disposed.
The RMB is not freely convertible. There is a risk that the Chinese government may take actions affecting
exchange rates which may have an adverse effect on our Groups net assets, earnings and any dividend
if such dividend is to be exchanged or converted into foreign exchange.
161
Currently our Group does not have a formal hedging policy and does not enter into any hedging
transactions to manage the potential uctuation in foreign currency as the risk is monitored on an ongoing
basis. Our Group will continue to monitor its foreign exchange exposure in the future and will consider
hedging any material foreign exchange exposure should the need arise. Prior to implementing any
formal hedging policies, we will seek the approval of our Board on the policy and put in place adequate
procedures which shall be reviewed and approved by our Audit Committee. Thereafter, all hedging
transactions entered into by our Group will be in accordance with the set policies and procedures.
Signicant Accounting Policy Changes
The accounting policies have been consistently applied by our Group during the Period Under Review
and includes the adoption of new and revised standards and interpretations of Singapore Financial
Reporting Standards, which did not have any material effect on the nancial performance or position of
our Group and the Company.
Unaudited Pro Forma Combined Financial Statements for FY2012 and FP2013
The unaudited pro forma combined balance sheets as at 31 December 2012 and 31 March 2013 took
into account the following:
(i) issue of new shares to Eastcomm arising from the capitalisation of debt amounting to $0.6 million
and cash injection amounting to $1.2 million which resulted in an increase in share capital and a
reduction in amounts due to ultimate holding company;
(ii) Mianzhu Norwest obtaining a bank loan of RMB5.0 million (or equivalent to $1.0 million based on
the exchange rate of RMB5.066:S$1.00) from a bank in the PRC which resulted in an increase in
interest bearing bank loan and cash and bank balances; and
(iii) the issue of new shares arising from the Restructuring Exercise which resulted in a decrease in
share capital and an increase in reserves.
These constitute the major differences between the audited combined balance sheet as at 31 December
2012 and the unaudited interim condensed combined balance sheet as at 31 March 2013 in comparison
with the unaudited pro forma combined balance sheets as at 31 December 2012 and 31 March 2013
respectively. Please refer to the Unaudited Pro Forma Combined Financial Information for the nancial
year ended 31 December 2012 and the three months period ended 31 March 2013 as set out in
Appendix C to this Offer Document for the pro forma adjustments to the combined balance sheets as at
31 December 2012 and 31 March 2013 resulting from the above.
The unaudited pro forma combined statement of cash ows for the nancial year/ period ended 31
December 2012 and 31 March 2013 took into account (i) and (ii) above. These constitute the major
differences between the audited combined statement of cash ow for the nancial year ended 31
December 2012 and the unaudited interim condensed combined statement of cash ow for the nancial
period ended 31 March 2013 in comparison with the unaudited pro forma combined statements of cash
ows for the nancial year/ period ended 31 December 2012 and 31 March 2013 respectively. Please
refer to the Unaudited Pro Forma Combined Financial Information for the nancial year ended 31
December 2012 and the three months period ended 31 March 2013 as set out in Appendix C to this
Offer Document for the pro forma adjustments to the combined statements of cash ow for the nancial
year ended 31 December 2012 and for the three months period ended 31 March 2013 resulting from (i)
and (ii) above.
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163
MANAGEMENT AND CORPORATE GOVERNANCE
DIRECTORS
Our Board of Directors is entrusted with the responsibility for the overall management of our Company.
Our Executive Directors work closely with our Key Executives in managing the various business
segments of our Group to ensure that our business operates smoothly and efciently.
The names, addresses and occupations of each of our Directors are set out below:

Name Age Address Principal occupation
Hong Pian Tee 68 50 Leedon Road
Singapore 267860
Chairman and Director of Pei Hwa
Foundation Limited
Dr. Ong Hian Eng
(1)
65 33 Mount Sinai Rise
#23-09
The Marbella
Singapore 276954
CEO and Executive Director of our
Group
Simon Ong
(1) (2)
48 20 Jalan Hajijah
#04-18
Laguna Green
Singapore 468726
Executive Director and Head of HR and
General Administration of our Group
Raymond Ong
(1) (2)
45 A22-03 Pavilion Residence 1
No 77 Jalan Raja Chulan
50200 Kuala Lumpur
Wilayah Persekutuan
Malaysia
Chief Financial Ofcer of Great Eastern
Life Assurance (Malaysia) Berhad
Ong Bee Pheng
(1) (2)
37 137 Sunset Way
#06-10 Clementi Park
Singapore 597159
Compliance Officer in the Singapore
ofce of Barclays Bank PLC
Francis Lee 47 57A Shelford Road
Singapore 286656
Director of Wise Alliance Investments
Ltd
Goh Yeow Tin 62 208A Rangoon Road
Hong Building
Singapore 218453
Non-Executive Chairman of Seacare
Medical Holdings Pte. Ltd.
Notes:
(1) Our CEO and Executive Director, Dr. Ong Hian Eng is the father of our Non-Executive Director, Ong Bee Pheng. He is also
the uncle of our Directors, Simon Ong and Raymond Ong.
(2) Our Directors, Simon Ong and Raymond Ong, are siblings. They are also cousins of our Non-Executive Director, Ong Bee
Pheng and nephews of our CEO and Executive Director, Dr. Ong Hian Eng.
(3) Save as disclosed in this section and in the section entitled Share Capital and Shareholders - Shareholders of this Offer
Document, there is no family relationship between any of our Directors and/ or Key Executives, or between any of our
Directors, Key Executives and Substantial Shareholders.
The business and working experience of our Directors is summarised below:
HONG PIAN TEE is our Non-Executive Chaiman and Independent Director. Prior to retiring from
professional practice, he was the managing director of PricewaterhouseCoopers Intrust Limited, a
position he held from 1985 to 1999.
Hong Pian Tee started his career as an audit assistant in Peat Marwick Mitchell & Co in 1973 after
attaining the Singapore-Cambridge General Certicate of Education (Ordinary Level) Examination Pass
in 1964. He was promoted to the senior manager of KPMG Peat Marwick in 1978. He started Lee King &
Associates (Management Consultants) and PricewaterhouseCoopers Intrust Limited in 1984 and 1985,
respectively, specialising in corporate advisory, nancial reconstruction and corporate insolvency. He
164
was an independent director of Asia Food & Properties Limited (now known as Sinarmas Land Limited),
a company listed on the Mainboard of the SGX-ST, from 2001 to 2006, and was the chairman and
independent director of Sin Ghee Huat Corporation Ltd., a company listed on the Mainboard of the SGX-
ST, from 2007 to 2009. He is currently the chairman of Pei Hwa Foundation Limited, a position he has
held since 2000, and is an independent director of Golden Agri-Resources Ltd, Memstar Technology Ltd.
and XMH Holdings Ltd., all of which are companies listed on the Mainboard of the SGX-ST.
DR. ONG HIAN ENG is our CEO and Executive Director. His responsibilities include overseeing the
overall development of our Groups corporate direction and policies as well as our Groups operations,
and playing an active role in the development, maintenance and strengthening of strategic business
relationships.
Dr. Ong Hian Eng started his career at Cold Storage (Singapore) Ltd. as an executive and production
manager between 1974 and 1978 and served as manufacturing manager at Rothmans of Pall Mall
(Singapore) Pte. Limited between 1978 and 1981. He joined the Hwa Hong Group in 1981 as its general
manager and had served as executive director of Hwa Hong and certain of its subsidiaries from February
1981 to July 2012, when he was redesignated as a non-executive director. During his appointment as
executive director of Hwa Hong, he oversaw the overall business development of Mianzhu Norwest until
the Hwa Hong Group divested its interests in Norwest Chemicals and Mianzhu Norwest. In August 2008,
he was part of the management which acquired the entire issued and paid-up share capital of Norwest
Chemicals from the Hwa Hong Group. He has been serving as a director and Legal Representative of
Mianzhu Norwest since 1996 and January 2010, respectively.
Dr. Ong Hian Eng holds a Bachelor of Science (second class honours, upper division) in Chemical
Engineering from the University of Surrey, and a Doctor of Philosophy from the University of London.
He is a corporate member in the class of fellows of The Institution of Chemical Engineers, London since
November 1986 and was a member of the Trade Development Board of Singapore from January 1995
to December 1996. He is also a member of the Singapore-Sichuan Trade & Investment Committee and
honorary council member of the Singapore Chinese Chamber of Commerce & Industry.
SIMON ONG is our Executive Director. His responsibilities include overseeing the human resource and
general administrative functions of our Group.
Simon Ong started his career as an audit assistant at KPMG Peat Marwick in 1991 and was
subsequently promoted to audit senior, audit supervisor and audit manager in 1992, 1994 and 1996,
respectively. Between 1996 and 1999, he served as director of corporate and nancial planning in King
George Development Corporation. Between 2000 and 2002, he worked at KPMG as an audit manager
where he was involved in audits and special engagements of local and multi-national companies
spanning various industries. He was later appointed as group nance manager and Chief Financial
Ofcer of Hwa Hong in 2002 and 2004, respectively, where he was responsible for overseeing its nancial
management, including accounting, tax, nancial control and reporting. As Chief Financial Ofcer of Hwa
Hong, he was responsible for the monitoring and supervision of the nancial reporting, and overseeing
the cash-ow and working capital management, of Mianzhu Norwest until the Hwa Hong Group divested
its interests in Norwest Chemicals and Mianzhu Norwest. Since January 2010, he has been serving as a
director of Mianzhu Norwest. He left Hwa Hong in July 2012.
Simon Ong studied accountancy in the North East London Polytechnic and qualied as a Fellow of The
Association of Chartered Certied Accountants. He is also a non-practising member of the Institute of
Singapore Chartered Accountants and a member of CPA Australia.
RAYMOND ONG is our Non-Executive Director and he is currently the Chief Financial Ofcer of Great
Eastern Life Assurance (Malaysia) Berhad.

Raymond Ong started his career in 1993 as a central banking ofcer at the Monetary Authority of
Singapore, and was appointed assistant director in its insurance commissioners department (life division)
for the period from 1998 to 2000. Between 2000 and 2002, he was regional actuarial manager of Allianz
Asia Pacic Pte. Ltd. where he was responsible for providing general actuarial support to its group entities
in the Asia-Pacic region, including providing technical actuarial support to its start-up life insurance
165
operations in Pune, India. Between 2002 and 2005, he was appointed as product development actuary
with Aviva Ltd in Singapore, before joining CIGNA International Corporation in 2005 as its regional
actuarial director, providing actuarial support to its group of companies in the Asia-Pacic region. In 2006,
he joined AXA Life Insurance Singapore Private Limited as its Chief Financial Ofcer and appointed
actuary and in 2007, he was seconded to serve as Chief Financial Ofcer and chief actuary of AXA-
Minmetals Assurance Company Ltd (Shanghai) until 2009. Between 2009 and 2011, he served as chief
actuary of Great Eastern Life Assurance (China) Co Ltd, where his responsibilities included providing
strategic support and analysis, strengthening and ensuring continued execution of nancial controls
and processes including the delivery of quality nancial reporting, and identifying opportunities for the
achievement of sales and expense targets.
Raymond Ong holds a Bachelor of Science in Actuarial Mathematics and Statistics (rst-class honours)
from Heriot-Watt University, Edinburgh, United Kingdom. He is also a Fellow of the Institute of Actuaries.
ONG BEE PHENG is our Non-Executive Director. She is currently a compliance ofcer in the Singapore
ofce of Barclays Bank PLC. Ong Bee Pheng started her career at Ernst & Young LLP, London as
an audit and tax associate between 1999 and 2003 where she was responsible for providing tax and
assurance services to clients. Between 2003 and 2004, she served as associate director in the markets
and clearing house division of the Monetary Authority of Singapore where she was responsible for
conducting off-site and on-site supervisions and inspections at The Central Depository (Pte) Limited
and assisting in the drafting of legislation. Since 2005, she has undertaken various appointments in the
compliance departments of various institutions including at Citibank N.A. between 2005 and 2007, the
Singapore ofce of Bank Julius Baer & Co. Ltd. between 2007 and 2008, the Singapore ofce of Barclays
Bank PLC between 2008 and 2009 and the Singapore ofce of Falcon Private Bank Ltd. between 2009
and 2011. She was a compliance ofcer at the Singapore ofce of Chinatrust Commercial Bank Co., Ltd.
from August 2011 to April 2012.
Ong Bee Pheng holds a Bachelor of Arts in Accounting and Law (Honours) from The University of
Manchester. She is also a Fellow of The Institute of Chartered Accountants in England and Wales.
FRANCIS LEE is our Independent Director. He is currently the director of Wise Alliance Investments Ltd,
where he manages and oversees investment portfolios, and is an independent director of Sheng Siong
Group Ltd., Net Pacic Financial Holdings Limited, Metech International Limited and Jes International
Holdings Limited, all of which are companies listed on the Mainboard or Catalist of the SGX-ST.
Francis Lee began his career in 1990 in the Commercial Crime Division of the Criminal Investigation
Department, where he served as a senior investigation ofcer until 1993. In 1993, he joined OCBC Bank
as an assistant manager conducting credit analysis until 1994. Between 1994 and 2001, he worked at
Deutsche Morgan Grenfell Securities as a dealers representative managing clients investment portfolios.
He served at the Singapore branch of the Bank of China between 2001 and 2004 as an assistant
manager overseeing a team of credit ofcers. Between 2004 and 2005, he worked at AP Oil International
Ltd as an investment and project manager, where he was involved in mergers and acquisitions and was
also tasked with overseeing its overall credit policy. Between 2005 and 2011, he served as an executive
director, nance director and Chief Financial Ofcer of Man Wah Holdings Ltd, a company listed on
the Hong Kong Stock Exchange, where he was responsible for the overall accounting functions of the
company and matters relating to its corporate regulatory compliance and reporting. He also served as a
non-independent, non-executive director of Man Wah Holdings Ltd between January 2011 and February
2012.
Francis Lee graduated from the National University of Singapore with a Bachelors degree in Accountancy
in 1990 and obtained a Master of Business Administration (Investment and Finance) from the University
of Hull in 1993. He is a Chartered Accountant and a non-practising member of the Institute of Singapore
Chartered Accountants.
GOH YEOW TIN is our Independent Director. He is currently the non-executive chairman of Seacare
Medical Holdings Pte. Ltd.. Goh Yeow Tin is also an independent director of Sheng Siong Group Ltd.,
Lereno Bio-Chem Ltd., Vicom Ltd and Oakwell Engineering Limited, all of which are companies listed on
the Mainboard of the SGX-ST. He is also a non-executive director of Linknet Asia Pte Ltd, WaterTech Pte.
Ltd., Seacare Manpower Services Pte Ltd and Edu Community Pte. Ltd..
166
Goh Yeow Tin began his career with the Economic Development Board (EDB) where he headed the
Local Industries Unit and was subsequently appointed a director of EDBs Automation Applications
Centre between 1986 and 1988. He served as deputy executive director of the Singapore Manufacturers
Association (now known as the Singapore Manufacturers Federation) from 1983 to 1984. In 1988, Goh
Yeow Tin joined Tonhow Industries Limited (now known as Asiamedic Limited), the rst plastic injection
moulding company to be listed on SESDAQ (now known as Catalist), and served as its deputy managing
director until 1990. In 1989, Goh Yeow Tin founded, and served as general manager of, International
Franchise Pte Ltd until 1991. Between 1990 and 2000, Goh Yeow Tin served as the vice-president of
Times Publishing Limited, and was responsible for retail and distribution businesses in Singapore, Hong
Kong and various parts of South-east Asia. From 2001 to 2011, Goh Yeow Tin was the CEO of Sino-Sing
Center Pte. Ltd., where he was involved in the operation of pre-school and primary school educational
and training programmes in the PRC.
Goh Yeow Tin holds a Bachelors degree in Mechanical Engineering (Honours) from the University of
Singapore (now known as the National University of Singapore) and a Masters degree in Engineering
from the Asian Institute of Technology. He was awarded the Public Service Medal in 1998 and the Public
Service Star in 2006. Goh Yeow Tin is also a member of the Singapore Institute of Directors.
Pursuant to Rule 406(3)(a) of the Catalist Rules, some of our Directors (namely, Simon Ong, Ong Bee
Pheng and Raymond Ong) do not have prior experience as directors of any public listed company in
Singapore. However, they have undertaken relevant training in Singapore to familiarise themselves with
the roles and responsibilities of a director of a public listed company in Singapore.
Save as disclosed in the Offer Document, our Independent Directors do not have any existing business or
professional relationship of a material nature with our Group, our Directors or Substantial Shareholders.
The list of present and past directorships of each Director over the last ve (5) years preceding the date
of this Offer Document, excluding those held in our Company, is set out below:
Name Present Directorships Past Directorships
Hong Pian Tee Group Companies Group Companies

Other Companies Other Companies
Golden Agri-Resources Ltd
Memstar Technology Ltd.
Pei Hwa Foundation Limited
XMH Holdings Ltd.
Intrust Asset Management (2006) Pte. Ltd.
Sin Ghee Huat Corporation Ltd.
Dr. Ong Hian Eng Group Companies Group Companies
Norwest Chemicals
Mianzhu Norwest

Eastcomm
Fica (Pte.) Ltd.
Fica Holdings Pte. Ltd.
Global Trade Investment Management
Pte Ltd
Hwa Hong Corporation Limited
HHEO
(Jining
Ningfeng Chemical Industry Co. Ltd.)
(Jining Paco
Chemical Industry Co., Ltd)
AsiaPhos Holdings Pte. Ltd.
(1)
Bee Tong Trading Company Private
Limited
(2)
Hwa Hong Capital (Pte) Limited
(3)
International Foundation Engineering Pte.
Ltd.
(4)
Norwest Holdings
(5)
Ong Holdings (Private) Limited
(6)
Rizhao Oriental Peanut Food Co., Ltd.
Tenet Capital Ltd (formerly know as Tenet
Insurance Company Ltd)
167
Kaifeng Yufen Oils, Fats & Foodstuffs
Co. Ltd
Ong Chay Tong & Sons (Private)
Limited
Paco Industries Pte. Ltd.
Shandong Hua Xing Plate Printing &
Can Manufacturing Co, Ltd
Shandong Qi Feng Packaging
Products Co. Ltd.
Singamet Trading Pte. Ltd.
Singapore Warehouse Company
(Private) Ltd.
Simon Ong Group Companies Group Companies
Mianzhu Norwest
Norwest Chemicals

Astute Investment Holdings Pte. Ltd.
Astute Ventures

Global Trade Investment Management Pte
Ltd
Scotts Spazio Pte. Ltd.
WYY Investment
Raymond Ong Group Companies Group Companies
Norwest Chemicals
Astute Investment Holdings Pte. Ltd.
Astute Ventures
Eastcomm
Great Eastern Asset Management
(Malaysia) Sdn Bhd
Great Eastern General Insurance Sdn
Bhd
Ong Chay Tong & Sons (Private)
Limited
Straits Lion Management (Malaysia)
Sdn Bhd
AXA Wealth Management Singapore Pte.
Ltd.
Bee Tong Trading Company Private
Limited
(2)
International Foundation Engineering Pte.
Ltd.
(4)
Ong Holdings (Private) Limited
(6)
Ong Bee Pheng Group Companies Group Companies

Eastcomm
Fica (Pte.) Ltd
Fica Holdings Pte. Ltd.
Francis Lee Group Companies Group Companies

Jes International Holdings Limited
Metech International Limited
Net Pacic Financial Holdings Limited
Sheng Siong Group Ltd.
Wise Alliance Investments Ltd
Man Wah Furniture (S) Pte. Ltd.
Man Wah Holdings Ltd
168
Goh Yeow Tin Group Companies Group Companies

Edu Community Pte. Ltd.
Lereno Bio-Chem Ltd.
Linknet Asia Pte Ltd
Oakwell Engineering Limited
Seacare Manpower Services Pte Ltd
(8)
Seacare Medical Holdings Pte. Ltd.
(9)
Sheng Siong Group Ltd.
Vicom Ltd
WaterTech Pte. Ltd.
De-Teachers Pte. Ltd.
ETLA Limited
International Education Development
Centre Pte. Ltd.
(7)
Juken Technology Limited
Lereno BC (Singapore) Pte. Ltd.
(10)
Scientic & Digital Forensic Services and
Corporate Investigations Pte. Ltd.
(11)
Sinnet Education Pte. Ltd.
(12)
Sino-Sing Center Pte. Ltd.
(13)
Notes:
(1) Dormant company which was struck off due to inactivity as at 5 June 2012.

(2) Dissolved pursuant to members voluntary winding up as at 16 August 2012.
(3) Dissolved pursuant to members voluntary winding up as at 10 May 2012.
(4) Dissolved pursuant to members voluntary winding up as at 16 August 2012.
(5) In liquidation pursuant to compulsory winding up (insolvency) as at 11 January 2008. Please see section entitled General
and Statutory Information Information on Directors and Key Executives of this Offer Document for further details.
(6) Dissolved pursuant to members voluntary winding up as at 30 October 2012.
(7) Struck off as at 8 December 2010.
(8) Seacare Manpower Services Pte Ltd is a wholly-owned subsidiary of Seacare Holdings Private Limited, which is in turn
wholly-owned by Seacare Co-operative Limited, which also wholly-owns Seacare Foundation, a Noteholder. Our Independent
Director, Goh Yeow Tin is a director of both Seacare Manpower Services Pte Ltd and Seacare Co-operative Ltd.
(9) Seacare Medical Holdings Pte. Ltd. is a subsidiary of Seacare Foundation, a Noteholder, which is in turn wholly-owned by
Seacare Co-operative Ltd. Our Independent Director, Goh Yeow Tin is a director of both Seacare Medical Holdings Pte. Ltd.
and Seacare Co-operative Ltd.
(10) Struck off as at 8 March 2011.
(11) Struck off as at 8 December 2010.
(12) Struck off as at 9 May 2012.
(13) Struck off as at 6 September 2012.
169
KEY EXECUTIVES
Our Directors are assisted by a team of experienced and qualied Key Executives who are responsible
for the various functions of our Company. The particulars of our Key Executives are as follows:
Name Age Address Principal occupation
Wang Xuebo 59 No. 161 Binghe Road
Mianzhu City
Sichuan Province
PRC
618200
General Manager of Mianzhu Norwest
Rachel Goh 33 69 Compassvale Bow
#13-38
Singapore 544993
Group Financial Controller
Chia Chin Hau 43 Blk 737 Woodlands Circle
#06-487
Singapore 730737
Manager (Special Projects)
Luo Guangming 44 No. 5 Floor 4
Block 4 of Unit 1 No. 244
Binghexi Road
Jiannan Town
Mianzhu City
Sichuan Province
PRC
618200
Mining Manager
The business and working experience of our Key Executives are set out below:
WANG XUEBO is the General Manager of Mianzhu Norwest. He has over 30 years of relevant
management and operational experience. He is responsible for and oversees the overall operations of our
Group, including our sales, marketing and daily operations in the PRC.
Wang Xuebo held various appointments at (Bai Ying Non-ferrous Metals
Corporation) between 1972 and 1976. Between 1979 and 1986, he was a translator for the
(Northwestern Institute of Mining and Metallurgy). Between 1986 and 1996, he served in
various appointments at (China Non-ferrous Foreign Engineering and
Construction Corporation) including deputy general manager (Egypt market), general representative
(Philippines market) and general manager (international market). He joined the Hwa Hong Group in
1996. During this time, he served as the general manager (PRC market) of HHEO between 1996 and
2008 and held various positions in (Jining Ningfeng Chemical Industry Co. Ltd.)
including director and general manager between 1996 and 2007. As Mianzhu Norwest was indirectly
held by HHEO through its 49.5% interest in Norwest Chemicals, Wang Xuebo also held various positions
in Mianzhu Norwest including general manager representative, general manager and executive director
during the period from 1996 till 2008. After HHEO ceased to have any interest in Norwest Chemicals in
August 2008, he held and continues to hold the positions of general manager and executive director in
Mianzhu Norwest.
RACHEL GOH is our Group Financial Controller. She is responsible for the overall nancial functions of
our Group, including preparation of nancial statements, cash management, corporate governance and
internal controls.
Rachel Goh started her career at KPMG in 2002 as audit assistant and was promoted to its audit senior
and assistant audit manager in 2004 and 2006, respectively, where she was responsible for planning
the entire audit engagement, including reviewing the nancial statements of companies and identifying
operational processes and nancial reporting cycle control weaknesses. Between 2007 and 2011, she
was nancial reporting manager of Hwa Hong where she was responsible for its nancial accounting
170
and reporting matters. Her role included assisting with the nancial reporting, and cash-ow and working
management of Mianzhu Norwest until the Hwa Hong Group divested its interests in Norwest Chemicals
and Mianzhu Norwest in August 2008. She joined us as Group Finance Manager in March 2011, and was
promoted to Group Financial Controller in January 2013.
Rachel Goh holds a Bachelor of Accountancy (Honours) from the Nanyang Technological University,
Singapore. She is a Chartered Accountant of the Institute of Singapore Chartered Accountants.
CHIA CHIN HAU is the Manager (Special Projects) of our Group. He has over 15 years of experience in
nance and accounting work. He is responsible for the implementation of risk management and internal
controls of our operations in the PRC.
Chia Chin Hau started his career as an audit assistant at Paul Chuah & Co in 1994 where he carried out
audit eld work, assisted with statutory audits and analysed management accounts. Between 1995 and
2000, he served as audit senior with Tay & Associates and Hals & Associates, where he was responsible
for audit related work including drafting auditing accounts and auditors report. In 2000, he joined
Pembinaan Angkasan Holding Sdn Bhd as accountant where he was responsible for the nance and
accounting matters of the company. In 2002, he joined HHEO as a special project accountant and was
seconded to the PRC in the same year to assist in the daily accounting matters of related companies,
including serving as nancial controller to Mianzhu Norwest for the period from 2004 to 2008. He joined
our Group as nancial controller in 2008, and was appointed as Manager (Special Projects) in 2012.
Chia Chin Hau holds a Master of Economics from the Universiti Putra Malaysia.
LUO GUANGMING is the Mining Manager of Mianzhu Norwest. He has over 20 years of experience in
Mining Operations. He is responsible for designing and planning our Groups Mining Operations, and
overseeing our Mining Operations, including supervision of the workers and ensuring compliance with
applicable safety and regulatory requirements.
Luo Guangming rst started his career in 1992 as a mining technology executive at the
(Deyang City Qingping Phosphate Mines) where he oversaw its Mining Operations, including attending
to technical issues. Between 1998 and 2002, he served as its vice manager and factory director where
he was responsible for the production and sales of phosphate products, before serving as vice manager
of its general ofce in 2003, where he was responsible for planning, designing and overseeing its mining
operations. Between 2003 and 2006, he served as chief engineer of (Pingwu
Manganese Industry Group Co., Ltd) where he was responsible for planning, designing and overseeing
its mining operations, including the supervision of workers and ensuring compliance with applicable
safety and regulatory measures. He joined our Group as mining manager in 2006.
Luo Guangming holds a - (Bachelor of Mining Engineering) from
(Wuhan Institute of Chemical Technology). He also holds a (Mining Engineer
Certication) from the (Personnel Department of Sichuan Province).

The list of present and past directorships of each Key Executive over the last ve (5) years preceding the
date of this Offer Document is set out below:
Wang Xuebo Group Companies Group Companies
Mianzhu Norwest
(Jining Ningfeng Chemical
Industry Co. Ltd.)
Rizhao Oriental Peanut Food Co., Ltd.
(Jining Paco Chemical
Industry Co., Ltd)
171
Kaifeng Yufen Oils, Fats & Foodstuffs Co. Ltd.
Shandong Hua Xing Plate Printing & Can
Manufacturing Co. Ltd
Shandong Qi Feng Packaging Products Co. Ltd.
WYY Investment
Rachel Goh Group Companies Group Companies


Chia Chin Hau Group Companies Group Companies
Norwest Chemicals

Luo Guangming Group Companies Group Companies


SERVICE AGREEMENTS
We have entered into separate Service Agreements with our Executive Directors, Dr. Ong Hian Eng and
Simon Ong, as well as our Key Executive, Wang Xuebo, on 30 May 2013.
The Service Agreements are for an initial period of three (3) years (unless terminated by (i) either party
giving not less than six (6) months notice in writing to the other; or (ii) the Company paying salary in
lieu of the period of time) with effect from the date of admission of our Company to Catalist (the
Effective Date). The Service Agreements cover the terms of employment and specically, the salaries
and bonuses of our Executive Directors and Key Executive. We may terminate a Service Agreement if,
inter alia, the relevant Executive Director or Key Executive is guilty of dishonesty or serious or persistent
misconduct, become bankrupt or otherwise act to our prejudice.
Directors fees do not form part of the terms of the Service Agreements as these require the approval
of our Shareholders in a general meeting. Pursuant to the terms of the Service Agreements, each of
our Executive Directors is entitled to a monthly salary of S$10,000, an annual wage supplement of one
(1) months salary and an annual incentive bonus (the Incentive Bonus) based on our Groups prots
before tax and the computation set out below.
For this purpose, PBT refers to the consolidated prots before Incentive Bonus and taxation of our
Group (after deducting prot before tax attributable to non-controlling interests).
Executive Director PBT
Computation of the Incentive Bonus
(expressed as a percentage of the
PBT achieved by our Group)
Dr. Ong Hian Eng Where the PBT is above S$5,000,000 2%
Simon Ong Where the PBT is above S$5,000,000 1%
Pursuant to the terms of the Service Agreement with our Key Executive, Wang Xuebo, he is entitled to
receive (i) US$5,820 per month, to be paid by Norwest Chemicals; and (ii) RMB30,000 per month, to be
paid by Mianzhu Norwest. He is also entitled to an annual incentive bonus of two per cent. (2%) of our
Groups PBT.
172
All travelling and travel-related expenses, entertainment expenses, and other out-of-pocket expenses
reasonably incurred by our Executive Directors and our Key Executive, Wang Xuebo, in the process of
discharging their duties on behalf of our Group will be borne by us.
Had the Service Agreements been in effect from 1 January 2012, the estimated aggregated remuneration
for the Executive Directors and our Key Executive, Wang Xuebo, would have been approximately S$0.5
million instead of S$0.3 million, and prot after taxation for FY2012 would have been approximately S$1.1
million instead of approximately S$1.2 million.
Our Remuneration Committee has considered the framework of remuneration for our Directors and
Key Executives for FY2013 and is of the view that the framework is fair and reasonable in light of the
respective roles, responsibilities, past and future contributions of our Directors and Key Executives, as
well as general market practices.
ARRANGEMENT OR UNDERSTANDING
There is no arrangement or understanding with any of our Substantial Shareholders, customers, suppliers
or any other person, pursuant to which any of our Directors or Key Executives was selected as our
Director or Key Executive.
DIRECTORS AND KEY EXECUTIVES REMUNERATION
The compensation (which includes, where applicable, contributions to the Central Provident Fund,
benets-in-kind and directors fees) paid to our Directors and our Key Executives for services rendered
to our Group on an aggregate basis and in remuneration bands for FY2011, FY2012 and FY2013
(estimated) are as follows:
FY2011 FY2012
FY2013
(1)
(Estimated)
Directors
Hong Pian Tee Band I
Dr. Ong Hian Eng Band I Band I Band I
Simon Ong Band I Band I Band I
Raymond Ong Band I
Ong Bee Pheng Band I
(2)
Band I
Goh Yeow Tin Band I
Francis Lee Band I
Key Executives
Wang Xuebo
(3)
Band I Band I Band I
Rachel Goh Band I Band I Band I
Chia Chin Hau Band I Band I Band I
Luo Guangming
(3)
Band I Band I Band I
Legend:
Band I : Compensation from S$0 to S$250,000 per year
Band II : Compensation from S$250,001 to S$500,000 per year
Band III : Compensation more than S$500,000 per year
Notes:
(1) Excludes, where applicable, incentive bonus and variable bonus payable.
(2) Between October 2012 and November 2012, Ong Bee Pheng served as an executive director of our Group.
(3) All payments required by the relevant PRC laws and regulations in relation to Wang Xuebo and Luo Guangming have been
fully paid for FY2011 and FY2012, and will be paid for FY2013.
173
Save as described in the section entitled Management and Corporate Governance Service
Agreements of this Offer Document, we do not have any formal bonus or prot-sharing plan or any other
prot-linked agreement or arrangement with any of our employees and bonus is expected to be paid on a
discretionary basis.
Save as required for compliance with applicable laws, no amounts have been set aside or accrued by our
Company or our subsidiaries to provide for pension, retirement or similar benets for our employees.
EMPLOYEES
The employees of Mianzhu Norwest are organised under a trade union formed to protect the legal
interests of such employees. The relationship and co-operation between our management and the trade
union has been good. There have not been any incidences of work stoppages or labour disputes arising
from trade union disputes which have affected our operations in any material respect.
Almost all our employees are based in the PRC. The functional distribution of our Groups headcount as
at 31 December 2010, 2011 and 2012 is as follows:
FY2010 FY2011 FY2012
Administration, human resources and accounts 7 11 18
Sales and marketing 5 4 5
Production and operations 136 117 127
Management 2 3 5
150 135 155
CORPORATE GOVERNANCE
Our Board of Directors recognises the importance of corporate governance and the offering of high
standards of accountability to our Shareholders. Our Board of Directors has formed three (3) committees:
(i) the Nominating Committee; (ii) the Remuneration Committee; and (iii) the Audit Committee.
Term of ofce
Each of our Directors has served in ofce in our Company since the following dates:
Name Date
Hong Pian Tee 22 August 2013
Dr. Ong Hian Eng 3 January 2012
Simon Ong 1 October 2012
Raymond Ong 1 October 2012
Ong Bee Pheng 1 October 2012
Francis Lee 22 August 2013
Goh Yeow Tin 22 August 2013
Our Directors do not currently have a xed term of ofce. Each Director shall retire from ofce at least
once every three (3) years. Directors who retire are eligible to stand for re-election.
Our Board conrms, with the concurrence of our Audit Committee, that the internal controls of our Group
are adequate to address our nancial, operational and compliance risks.
174
AUDIT COMMITTEE
Our Audit Committee comprises our Independent Directors, Hong Pian Tee, Francis Lee and Goh Yeow
Tin. The chairman of the Audit Committee is Francis Lee.
Our Audit Committee will assist our Board of Directors in discharging their responsibility to safeguard our
assets, maintain adequate accounting records, and develop and maintain effective systems of internal
control, with the overall objective of ensuring that our management creates and maintains an effective
control environment in our Group. Our Audit Committee will provide a channel of communication between
our Board of Directors, our management and our external auditors on matters relating to audit.
The duties of our Audit Committee shall include:
(a) reviewing the signicant nancial reporting issues and judgements, so as to ensure the integrity of
our nancial statements and any announcements relating to our nancial performance;
(b) reviewing the half-yearly and annual financial statements (and quarterly if applicable) and
any formal announcements relating to our Groups nancial performance before submission
to our Board of Directors for approval, focusing in particular on changes in accounting policies
and practices, major risk areas, signicant adjustments resulting from the audit, compliance with
accounting standards and compliance with the Catalist Rules and any other relevant statutory or
regulatory requirements;
(c) reviewing our Groups hedging policies procedures and activities (if any) and monitoring the
implementation of the hedging procedure/policies, including reviewing the instruments, processes
and practices in accordance with any hedging policies approved by our Board of Directors;
(d) reviewing and discussing with investigators, any suspected fraud, irregularity or infringement of any
relevant laws, rules or regulations, which has or is likely to have a material impact on our Groups
operating results or nancial position and our managements response thereto;
(e) reviewing and reporting to the Board of Directors at least annually the adequacy and effectiveness
of our internal controls, including nancial, operational, compliance and information technology
controls (such review may be carried out internally or with the assistance of any competent third
parties);
(f) reviewing the effectiveness of internal audit and controls;
(g) reviewing the scope and results of the external audit, and the independence and objectivity of the
external auditors;
(h) making recommendations to the Board of Directors on the proposals to Shareholders on the
appointment, re-appointment and removal of the external auditors, and approving the remuneration
and terms of engagement of the external auditors;
(i) reviewing the annual consolidated nancial statements and the external auditors report on such
accounting policies, compliance with SFRS, concerns and issues arising from their audits including
any matters which the auditors may wish to discuss in the absence of our management where
necessary, before submission to our Board of Directors for approval;
(j) reviewing and approving any Interested Person Transactions and/ or potential conicts of interest;
(k) undertaking such other reviews and projects as may be requested by our Board of Directors, and
reporting to our Board of Directors its ndings from time to time on matters arising and requiring
the attention of our Audit Committee; and
(l) generally undertaking such other functions and duties as may be required by law or the Catalist
Rules, or by such amendments as may be made thereto from time to time.
175
In addition, we have adopted certain procedures in respect of any change of the Legal Representative of
Mianzhu Norwest. Please refer to the section below entitled Management and Corporate Governance
Legal Representative and Supervisor of our PRC subsidiary, Mianzhu Norwest of this Offer Document for
further details.
Apart from the duties listed above, our Audit Committee shall communicate and review the ndings of
internal investigation into matters where there is any suspected fraud or irregularity or failure of internal
controls or infringement of any law, rule or regulation which has or is likely to have a material impact on
our Companys operating units and/ or nancial position.
Our Audit Committee shall also commission an annual internal control audit until such time as our Audit
Committee is satised that our Groups internal controls are robust and effective enough to mitigate our
Groups internal control weaknesses (if any). Prior to the decommissioning of such an annual audit, our
Board is required to report to the SGX-ST and the Sponsor on how the key internal control weaknesses,
if any, have been rectied, and the basis for the decision to decommission the annual internal control
audit. Thereafter, such audits may be initiated by our Audit Committee as and when it deems t to satisfy
itself that our Groups internal controls remain robust and effective. Upon completion of the internal
control audit, appropriate disclosure will be made via SGXNET of any material, price-sensitive internal
control weaknesses and any follow-up actions to be taken by our Board.
Currently, based on the internal controls established and maintained by our Group, work performed by
the internal and external auditors, and reviews performed by our management and our Board, our Audit
Committee agrees with our Boards conrmation that the internal controls of our Group are adequate to
address our nancial, operational and compliance risks.
Our Audit Committee, after having:
(a) conducted an interview with our Group Financial Controller, Rachel Goh;
(b) considered the qualications and past working experience of Rachel Goh (as described in
the section entitled Management and Corporate Governance Key Executives of this Offer
Document);
(c) observed Rachel Gohs abilities, familiarity and diligence in relation to the nancial matters and
information of our Group; and
(d) made all reasonable enquiries,
is of the view that, to the best of its knowledge and belief, nothing has come to the attention of our Audit
Committee to cause them to believe that Rachel Goh does not have the competence, character and
integrity expected of a Group Financial Controller of our Company.
NOMINATING COMMITTEE
Our Nominating Committee comprises our Independent Directors, Francis Lee and Goh Yeow Tin, as well
as our CEO and Executive Director, Dr. Ong Hian Eng. The chairman of the Nominating Committee is
Goh Yeow Tin.
The duties of our Nominating Committee shall include making recommendations to the Board on relevant
matters relating to:
(a) review of board succession plans for Directors, in particular, the Non-Executive Chairman and for
the CEO and Executive Director;
(b) the development of a process for evaluation of the performance of the Board of Directors, its
committees and Directors;
(c) the review of training and professional development programmes for the Board of Directors;
176
(d) reviewing and sighting all resignation and authorisation letters of the Legal Representatives
of Mianzhu Norwest which have been signed in advance and held in custody by our company
secretary; and
(e) the appointment and re-appointment of Directors (including alternate directors, if applicable).
Important issues to be considered as part of the process for the selection, appointment and re-election
of Directors include composition and progressive renewal of the Board of Directors and each Directors
competencies, commitment, contribution and performance (e.g. attendance, preparedness, participation
and candour), including, if applicable, as our Independent Director.
The Nominating Committee is also charged with the responsibility of determining annually, and as and
when circumstances require, whether a Director is independent.
Each member of our Nominating Committee shall abstain from voting on any resolution in respect of the
assessment of his performance, independence or re-nomination as Director or those of persons related
to him.
Our Nominating Committee has reviewed the appointment of Hong Pian Tee, Francis Lee and Goh Yeow
Tin as Independent Directors of our Company. Each of Hong Pian Tee, Francis Lee and Goh Yeow Tin
had abstained from participating in the review of their own respective appointments.
Having taken into consideration the composition of the Board of Directors, and the respective suitability,
experience and commitments of each of Hong Pian Tee, Francis Lee and Goh Yeow Tin, our Nominating
Committee is of the view that each of Hong Pian Tee, Francis Lee and Goh Yeow Tin is individually and
collectively able to commit sufcient time to the discharge of their duties and are suitable and possess
relevant experience as Independent Directors of our Company.
Each of Hong Pian Tee, Francis Lee and Goh Yeow Tin has conrmed that notwithstanding that he
currently holds independent directorships in listed companies, he will have sufcient time to serve as an
Independent Director of our Company.
Our Nominating Committee, after having:

(i) noted that our Group Financial Controller, Rachel Goh, has been employed by our Group for a
period of more than two (2) years;
(ii) conducted an interview with Rachel Goh, and observed Rachel Gohs abilities, professionalism
and diligence in relation to the nancial matters and information of our Group in the course of the
preparations for the listing of our Company; and
(iii) considered Rachel Gohs former role as a nancial reporting manager of Hwa Hong, and made all
reasonable enquiries into whether there are any relationships or circumstances which are likely to
affect, or could appear to affect, Rachel Gohs exercise of objective or independent judgment in
relation to matters of our Group,
considers that Rachel Goh possesses the independence in character and judgement expected of a
Group Financial Controller of our Company, and that her former employment with Hwa Hong will not
affect her ability to exercise independent judgement and act in the best interests of our Group.
177
REMUNERATION COMMITTEE
Our Remuneration Committee comprises our Independent Directors, Hong Pian Tee, Francis Lee and
Goh Yeow Tin. The chairman of the Remuneration Committee is Goh Yeow Tin.
Our Remuneration Committee shall recommend to our Board of Directors a general framework of
remuneration for our Directors and Key Executives, and review and recommend specic remuneration
packages for each of our Directors and Key Executives. The level and structure of remuneration packages
shall be aligned with the long-term interest and risk policies of our Company, and shall be appropriate to
attract, retain and motivate (i) our Directors to provide good stewardship of our Company; and (ii) our Key
Executives to successfully manage our Company.
The recommendations of our Remuneration Committee shall be submitted for endorsement by our entire
Board of Directors. All aspects of remuneration, including but not limited to, where applicable, Directors
fees, salaries, allowances and bonuses, options, share-based incentives and awards, and benets in
kind shall be covered by our Remuneration Committee. If necessary, the Remuneration Committee shall
seek expert advice inside and/ or outside our Company on remuneration of our Directors. In so doing,
the Remuneration Committee shall ensure that existing key relationships, if any, between our Company
and our appointed remuneration consultants will not affect the independence and objectivity of the
remuneration consultants. Each member of the Remuneration Committee shall abstain from voting on any
resolutions in respect of his remuneration package.
The details of the remuneration of employees who are immediate family members of our Directors, or
our CEO and Executive Director, will be reviewed annually by our Remuneration Committee to ensure
that their remuneration packages are in line our staff remuneration guidelines and commensurate with
their respective job scopes and level of responsibilities. In the event that a member of our Remuneration
Committee is related to the employee under review, he will abstain from such review.
LEGAL REPRESENTATIVE AND SUPERVISOR OF OUR PRC SUBSIDIARY, MIANZHU NORWEST
Legal Representative
Our CEO and Executive Director, Dr. Ong Hian Eng, is the Legal Representative of Mianzhu Norwest.
Dr. Ong Hian Eng is also a director of Mianzhu Norwest. For further details of the role, responsibilities
and powers of the Legal Representative of Mianzhu Norwest under PRC Law, please refer to the section
entitled General Information on our Group Legal Opinion from King & Wood Mallesons of this Offer
Document.
Our Audit Committee has noted that there are risks in relation to the appointment of the Legal
Representative in Mianzhu Norwest, including concentration of authority and impediments to removal.
After having reviewed such risks and noting that:
(i) the articles of association of Mianzhu Norwest have been amended to grant its sole shareholder,
Norwest Chemicals, which is wholly-owned by our Company, the power to, inter alia, remove the
Legal Representative of Mianzhu Norwest. The amendment has been approved by the Deyang
Commerce Bureau, and is in the process of registering/ ling this with the Deyang AIC Bureau;
(ii) Norwest Chemicals has executed an irrevocable letter of undertaking to our Company stating
that, inter alia, it shall use all best endeavours to procure that the appointment and the removal of
the Legal Representative of Mianzhu Norwest by Norwest Chemicals shall only be carried out in
accordance with such resolution(s) as may be passed by our Board of Directors; and
(iii) Dr. Ong Hian Eng and his Associates shall abstain from voting on any resolution to remove or re-
appoint Dr. Ong Hian Eng as the Legal Representative of Mianzhu Norwest,
178
the Audit Committee is of the view that there are adequate processes and procedures in place to
mitigate the risks in relation to the appointment of the Legal Representative of Mianzhu Norwest. Our
Audit Committee will monitor and periodically review the processes and procedures in relation to the
appointment and removal and the avoidance of concentration of authority of the Legal Representative of
Mianzhu Norwest, to ensure their effectiveness and robustness.
None of our Independent Directors sits on the board of our PRC subsidiary, Mianzhu Norwest.
Supervisor
Toh Thiam Seah Victor is the (Supervisor) of Mianzhu Norwest. For further details of the role,
responsibilities and powers of the (Supervisor) of Mianzhu Norwest under PRC Law, please refer to
the section entitled General Information on our Group Legal Opinion from King & Wood Mallesons of
The articles of association of Mianzhu Norwest have been amended and include the following articles
regarding the Supervisor of Mianzhu Norwest:
(i) reviewing the nancial affairs of Mianzhu Norwest;
(ii) monitoring the performance of duties of the directors and senior managers of Mianzhu Norwest,
and proposing the removal of any director or senior manager who is in breach of any law,
administrative regulation, the articles of association of Mianzhu Norwest or any resolutions passed
at any Mianzhu Norwest shareholders meeting;
(iii) requesting any director or senior manager of Mianzhu Norwest to rectify his/ her action if such
action is in conict with the interests of Mianzhu Norwest;
(iv) convening interim shareholders meeting for Mianzhu Norwest, and convening and leading the
shareholders meeting when the board of directors of Mianzhu Norwest does not exercise such
duties according to PRC law; and
(v) proposing resolutions at Mianzhu Norwests shareholders meeting
(the Supervisor Amendments).
The Supervisor Amendments have been approved by the Deyang Commerce Bureau, and Mianzhu
Norwest is in the process of registering/ ling this with the Deyang AIC Bureau.
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ASIAPHOS PERFORMANCE SHARE PLAN
We have implemented a performance share plan that will be in place after the Invitation known as the
AsiaPhos Performance Share Plan. The following is a summary of the principal terms of the AsiaPhos
Performance Share Plan adopted by our Company in conjunction with the listing of our Shares on
Catalist. The terms and the rules of the AsiaPhos Performance Share Plan are more particularly set out
in Appendix F to this Offer Document (the Rules). Capitalised terms used in this summary which are
not otherwise dened in this summary bear the same meanings as ascribed in the Rules of the AsiaPhos
Performance Share Plan.
1. Objectives of the AsiaPhos Performance Share Plan
The objectives of the AsiaPhos Performance Share Plan are to :
(a) foster a framework of ownership within our Group which coordinates the interests of our
Group Executives with the interests of Shareholders;
(b) motivate Participants to achieve key nancial and operational goals of our Company and/ or
their respective business units and encourage greater commitment and loyalty to our Group;
(c) make total employee remuneration sufciently competitive to recruit new Participants with
relevant skills; and;
(d) recognize the efforts of and retain existing Participants whose contributions are important to
the long-term development and protability of our Group.
2. The AsiaPhos Performance Share Plan
Awards granted under the AsiaPhos Performance Share Plan will primarily be performance-based,
incorporating an element of stretched targets for senior executives and considerably stretched
targets for key senior management, aimed at delivering long-term Shareholder value. Examples
of performance targets to be set include targets based on criteria such as medium- and long-
term corporate objectives of our Group, and will be aimed at sustaining long-term growth. The
corporate objectives shall cover market competitiveness, business growth and productivity growth.
The performance targets could be based on criteria such as sales growth, growth in earnings and
return on investment. Additionally, inter alia, the Participants length of service with our Group,
achievement of past performance targets, extent of value-adding to our Groups performance and
development and overall enhancement to Shareholder value will be taken into account.
Our Company believes that the AsiaPhos Performance Share Plan will be an effective mechanism
to motivate senior executives and key senior management to work towards stretched targets,
thereby incentivising senior executives and key senior management to enhance economic value for
Shareholders.
The AsiaPhos Performance Share Plan contemplates the award of fully-paid Shares, when and
after pre-determined performance or service conditions are accomplished.
A Participants Award under the AsiaPhos Performance Share Plan will be determined at
the sole discretion of the Committee. In considering the grant of an Award to a Participant, the
Committee may take into account, inter alia, the Participants capability, creativity, entrepreneurship,
innovativeness, scope of responsibility and skill set. The committee may also set specic and
Performance Conditions for each different department, taking into account factors such as (i) our
Groups business goals and directions for each nancial year; (ii) the Participants actual job scope
and duties; and (iii) prevailing economic conditions.
Under the AsiaPhos Performance Share Plan, Participants are encouraged to continue serving our
Group beyond the deadline for the achievement of the pre-determined performance targets. The
Committee has the discretion to impose a further vesting period after the performance period to
encourage the Participant to continue serving our Group.
180
3. Summary of Rules of the AsiaPhos Performance Share Plan
3.1 Eligibility
Group Executives who have attained the age of 21 years as of the Award Date and hold such
rank as may be designated by the Committee from time to time are eligible to participate in the
AsiaPhos Performance Share Plan. Group Executive Directors and Group Non-Executives
Directors (including Independent Directors) are eligible to participate in the AsiaPhos Performance
Share Plan. The Participant must also not be an undischarged bankrupt and must not have entered
into a composition with his creditors.
Persons who are Controlling Shareholders or Associates of a Controlling Shareholder who meet
the criteria above are also eligible to participate in the AsiaPhos Performance Share Plan, provided
that the participation of and the terms of each grant and the actual number of Awards granted
under the AsiaPhos Performance Share Plan to a Participant who is a Controlling Shareholder
or an Associate of a Controlling Shareholder shall be approved by independent Shareholders in
general meeting in separate resolutions for each such person, and in respect of each such person,
in separate resolutions for each of (i) his participation; and (ii) the terms of each grant and the
actual number of Awards to be granted to him, provided always that it shall not be necessary to
obtain the approval of independent Shareholders for the participation in the AsiaPhos Performance
Share Plan of a Controlling Shareholder or an Associate of a Controlling Shareholder who is, at the
relevant time already a Participant.
There shall be no restriction on the eligibility of any Participant to participate in any other share
incentive schemes or share plans implemented or to be implemented by our Company or any other
company within our Group.
3.2 Awards
Awards represent the right of a Participant to receive fully-paid Shares free-of-charge, provided
that certain prescribed performance targets (if any) are met and upon expiry of the prescribed
performance period.
Shares which are issued and allotted or transferred to a Participant pursuant to the grant of an
Award are personal to the Participant to whom the Award is granted, and shall not be transferred,
charged, assigned, pledged or otherwise disposed of, in whole or in part, during a specied
period (as prescribed by the Committee in the Award letter), except to the extent approved by the
Committee.
The Committee may, in its absolute discretion, make a Release of an Award, wholly or partly, in the
form of cash rather than Shares.
3.3 Participants
The selection of a Participant and the number of Shares (which are the subject of each Award)
to be granted to a Participant in accordance with the AsiaPhos Performance Share Plan shall
be determined at the absolute discretion of the Committee, which shall take into account criteria
such as, inter alia, his rank, scope of responsibilities, job performance, years of service, potential
for future development, and contribution to the success and development of our Group and, if
applicable, the extent of effort and resourcefulness required to achieve the performance target(s)
within the performance period.
3.4 Details of Awards
The Committee shall decide, in relation to an Award:
(a) the Participant;
(b) the Award Date;
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(c) the Performance Period;
(d) the number of Shares which are the subject of the Award;
(e) the Performance Condition(s);
(f) the Release Schedule; and
(g) any other condition(s) which the Committee may determine in relation to that Award.
A member of the Committee who is also a Participant shall not be involved in the Committees
deliberation in respect of Awards granted or which will be granted to him.
3.5 Timing
Awards may be granted at any time in the course of a nancial year. An Award Letter conrming
the Award and specifying, inter alia, the Award Date, the Performance Condition(s), the number
of Shares which are the subject of the Award, the Performance Period and the Release
Schedule setting out the extent to which Shares will be released on satisfaction of the prescribed
performance target(s), will be sent to each Participant as soon as is reasonably practicable after
the granting of an Award.
The Committee will take into account various factors when determining the method to arrive at
the exact number of Shares comprised in an Award. Such factors include, but are not limited
to, the current price of our Shares, the total issued share capital of our Company and the pre-
determined dollar amount which the Committee decides that a Participant deserves for meeting his
performance targets.
For example, Shares may be awarded based on pre-determined dollar amounts such that
the quantum of Shares comprised in Awards is dependent on the closing price of our Shares
transacted on the Market Day the Award is vested. Alternatively, the Committee may decide
absolute numbers of Shares to be awarded to Participants irrespective of the price of the
Shares. The Committee shall monitor the grant of Awards carefully to ensure that the size of the
Performance Share Plan will comply with the relevant rules of the Listing Manual.
3.6 Events Prior to Vesting
Special provisions for the vesting, lapsing and/ or cancellation of Awards apply in certain
circumstances including the following:
(a) misconduct on the part of a Participant as determined by the Committee in its discretion;

(b) where the Participant is a Group Executive, upon the Participant ceasing to be in the
employment of our Group for any reason whatsoever (other than as specied in paragraph
(e) below);
(c) an order being made or a resolution passed for the winding-up of our Company on the basis,
or by reason, of its insolvency;
(d) the bankruptcy of a Participant or the happening of any other event which results in him
being deprived of the legal or benecial ownership of the Award;
(e) the Participant, being a Group Executive, ceases to be in the employment of our Group by
reason of:
(i) ill-health, injury or disability (in each case, evidenced to the satisfaction of the
Committee);
(ii) redundancy;
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(iii) retirement at or after the legal retirement age;
(iv) retirement before the legal retirement age with the consent of the Committee;
(v) the company by which he is employed or to which he is seconded, as the case may
be, ceasing to be a company within our Group or the undertaking or part of the
undertaking of such company being transferred otherwise than to another company
within our Group;
(vi) his transfer of employment between companies within the Group;
(vii) his transfer to any government ministry, governmental or statutory body or corporation
at the direction of any company within our Group; or
(viii) any other event approved by the Committee;
(f) the death of a Participant;
(g) any other event approved by the Committee; or
(h) a take-over, reconstruction or amalgamation of our Company or an order being made or a
resolution passed for the winding-up of our Company (other than as provided in paragraph
(c) above or for reconstruction or amalgamation).
Upon the occurrence of any of the events specied in paragraphs (a), (b), and (c), an Award then
held by a Participant shall, subject as provided in the Rules of the AsiaPhos Performance Share
Plan and to the extent not yet released, immediately lapse without any claim whatsoever against
our Company.
Upon the occurrence of any of the events specied in paragraphs (d) (e), (f) and (g) above, the
Committee may, in its absolute discretion, preserve all or any part of any Award and decide either
to Vest some or all of the Shares which are the subject of the Award or to preserve all or part
of any Award until the end of the relevant Performance Period. In exercising its discretion, the
Committee will have regard to all circumstances on a case-by-case basis, including (but not limited
to) the contributions made by that Participant and, in the case of performance-related Awards, the
extent to which the applicable Performance Conditions have been satised.
Upon the occurrence of the event specied in paragraph (h) above, the Committee will consider, at
its discretion, whether or not to release any Award, and will take into account all circumstances on
a case-by-case basis, including (but not limited to) the contributions made by that Participant. If the
Committee decides to Release any Award, then in determining the number of Shares to be Vested
in respect of such Award, the Committee will have regard to the proportion of the Performance
Period which has lapsed and the extent to which the applicable Performance Conditions have been
satised.
3.7 Size and Duration of the AsiaPhos Performance Share Plan
The aggregate number of Shares which may be issued or transferred pursuant to Awards granted
under the AsiaPhos Performance Share Plan, when added to (i) the number of Shares issued and
issuable and/ or transferred or transferable in respect of all Awards granted thereunder; and (ii) all
Shares issued and issuable and/ or transferred or transferable in respect of all options granted or
awards granted under any other share incentive schemes or share plans adopted by the Company
for the time being in force, shall not exceed fteen per cent. (15%) of the entire issued and paid-up
share capital (excluding treasury shares) of our Company on the day preceding the relevant date of
the Award.
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In addition, the number of Shares available to Controlling Shareholders or Associates of a
Controlling Shareholder are subject to the following:
(a) the aggregate number of Shares comprised in Awards granted to Controlling Shareholders
or Associates of Controlling Shareholders under the AsiaPhos Performance Share Plan shall
not exceed twenty-ve per cent. (25%) of the aggregate number of Shares (comprised in
Awards) which may be granted under the AsiaPhos Performance Share Plan; and
(b) the number of Shares available to each Controlling Shareholder or Associate of a Controlling
Shareholder shall not exceed ten per cent. (10%) of the Shares available under the
AsiaPhos Performance Share Plan.
The AsiaPhos Performance Share Plan shall continue in force at the discretion of the Committee,
subject to a maximum period of ten (10) years commencing on the date on which the AsiaPhos
Performance Share Plan is adopted by our Company in general meeting, provided always that the
AsiaPhos Performance Share Plan may continue beyond the aforementioned stipulated period with
the approval of Shareholders in general meeting and of any relevant authorities which may then be
required.
Notwithstanding the expiry or termination of the AsiaPhos Performance Share Plan, any Awards
made to Participants prior to such expiry or termination will continue to remain valid.
We have made an application to the SGX-ST for permission to deal in and for quotation of new
Shares which may be issued upon the grant of Awards under the AsiaPhos Performance Share
Plan. The approval of the SGX-ST is not to be taken as an indication of the merits of our Group,
our Shares or the Shares which are the subject of the Awards.
3.8 Operation of the AsiaPhos Performance Share Plan
Subject to the prevailing legislation, our Company may deliver Shares to Participants upon Vesting
of their Awards by way of an issue of new Shares deemed to be fully paid upon their issuance and
allotment and/ or by way of the transfer of treasury shares (by way of purchasing existing Shares
from the market for delivery to Participants pursuant to the Act).
In determining whether to issue new Shares to Participants or to purchase existing Shares upon
vesting of their Awards, our Company will take into account factors such as (but not limited to) the
number of Shares to be delivered, the prevailing market price of the Shares and the cost to our
Company of either issuing new Shares or purchasing existing Shares.
Additionally, our Company has the exibility, and if circumstances require, to approve the Release
of an Award, wholly or partly, in the form of cash rather than Shares. In determining whether to
Release an Award, wholly or partly, in the form of cash rather than Shares, our Company will take
into account factors such as (but not limited to) the cost to our Company of Releasing an Award,
wholly or partly, in the form of cash rather than Shares.
The nancial effects of the above methods are discussed in paragraph 7 below.
New Shares issued and allotted, and existing shares procured by the Company for transfer, on the
Release of an Award shall be eligible for all entitlements, including dividends or other distributions
declared or recommended in respect of the then existing Shares, the record date for which is on or
after the relevant date of issue or, as the case may be, delivery, and shall in all other respects rank
pari passu with other existing Shares then in issue.
The Committee shall have the discretion to determine whether the Performance Condition(s) have
been satised (whether fully or partially) or exceeded; and in making any such determination, the
Committee shall have the right to make reference to the audited results of our Company or our
Group, and to take into account such factors as the Committee may determine to be relevant, such
as changes in accounting methods, taxes and extraordinary events, and further, the right to amend
the performance target(s) if the Committee decides that a changed performance target would be a
fairer measure of performance.
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4. Adjustments and Alterations under the AsiaPhos Performance Share Plan
4.1 Adjustment Events
If a variation in the issued ordinary share capital of our Company (whether by way of a
capitalisation of prots or reserves or rights issue, capital reduction, subdivision, consolidation,
distribution or otherwise) shall take place, then:
(a) the class and/ or number of Shares which are the subject of an Award to the extent not yet
Vested; and/ or
(b) the class and/ or number of Shares over which future Awards may be granted under the
AsiaPhos Performance Share Plan,
shall be adjusted in such manner as the Committee may determine to be appropriate, provided that
no adjustment shall be made if as a result, the Participant receives a benet that a Shareholder
does not receive.
The issue of securities as consideration for an acquisition or a private placement of securities
or the cancellation of issued Shares purchased or acquired by our Company by way of a market
purchase of such Shares undertaken by our Company on the SGX-ST during the period when a
share purchase mandate granted by Shareholders (including any renewal of such mandate) is in
force shall not normally be regarded as a circumstance requiring adjustment, unless the Committee
considers an adjustment to be appropriate.
Any adjustment (except in relation to a capitalisation issue) must be conrmed in writing by the
Auditors (acting only as experts and not as arbitrators) to be in their opinion, fair and reasonable.
4.2 Modications or Alterations to the AsiaPhos Performance Share Plan
The AsiaPhos Performance Share Plan may be modied and/ or altered from time to time by a
resolution of the Committee subject to the prior approval of our Shareholders, the SGX-ST and/or
such other regulatory authorities as may be necessary.
However, no modication or alteration shall adversely affect the rights attached to Awards
granted prior to such modication or alteration except with the written consent of such number of
Participants under the AsiaPhos Performance Share Plan who, if their Awards were Released to
them, would thereby become entitled to not less than three quarters of all the Shares which would
fall to be Vested upon Release of all outstanding Awards under the AsiaPhos Performance Share
Plan.
No alteration shall be made to particular rules of the AsiaPhos Performance Share Plan to the
advantage of the holders of the Awards, except with the prior approval of Shareholders in general
meeting.
5. Disclosures in Annual Reports
Our Company will make such disclosures in its annual report for so long as the AsiaPhos
Performance Share Plan continues in operation as from time to time required by the Catalist Rules
including the following (where applicable):
(a) the names of the members of the Committee administering the AsiaPhos Performance
Share Plan;
(b) in respect of the following Participants:
(i) Directors of our Company;
(ii) Controlling Shareholders and their Associates; and
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(iii) Participants (other than those in paragraphs (i) and (ii) above) who have received
Shares pursuant to the Release of Awards granted under the AsiaPhos Performance
Share Plan which, in aggregate, represent five per cent. (5%) or more of the
aggregate number of new Shares available under the AsiaPhos Performance Share
Plan,
the following information:
(aa) the name of the Participant;
(bb) the aggregate number of Shares comprised in Awards granted to such participants
during the nancial year under review;
(cc) the number of new Shares issued to such Participant during the nancial year under
review;
(dd) the number of existing Shares purchased for delivery pursuant to Release of Awards
to such Participant during the nancial year under review;
(ee) the aggregate number of Shares comprised in Awards which have not been released
as at the end of the nancial year under review;
(ff) the aggregate number of Shares comprised in Awards granted since the
commencement of the AsiaPhos Performance Share Plan to the end of the nancial
year under review;
(gg) the number of new Shares allotted to such Participant since the commencement of the
AsiaPhos Performance Share Plan to the end of the nancial year under review; and
(hh) the number of existing Shares transferred to the Participant since the commencement
of the AsiaPhos Performance Share Plan to the end of the nancial year under review;
(c) in relation to the AsiaPhos Performance Share Plan:
(i) the aggregate number of Shares comprised in Awards Vested since the
commencement of the AsiaPhos Performance Share Plan to the end of the nancial
year under review;
(ii) the aggregate number of new Shares issued which are comprised in the Awards
Vested during the nancial year under review; and
(iii) the aggregate number of Shares comprised in Awards which have not been Released,
as at the end of the nancial year under review; and
(d) such other information as may be required by the Catalist Rules or the Act.
If any of the above is not applicable, an appropriate negative statement shall be included therein.
6. Role and Composition of the Committee
The Committee responsible for the administration of the AsiaPhos Performance Share Plan will
comprise such Directors or such persons duly authorised and appointed by the Board of Directors
to administer the Performance Share Plan, provided that no member of the Committee shall
participate in any deliberation or decision in respect of Awards granted or to be granted to him or
his Associate.
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The Committee shall have the power, from time to time, to make and vary such rules (not being
inconsistent with the Performance Share Plan) for the implementation and administration of the
AsiaPhos Performance Share Plan as it thinks t, including, but not limited to:
(a) imposing restrictions on the number of Awards that may be vested within each nancial year;
and
(b) amending performance targets if by doing so, it would be a fairer measure of performance of
a Participant or for the AsiaPhos Performance Share Plan as a whole.
7. Financial Effects of the AsiaPhos Performance Share Plan
Financial Reporting Standard 102, Share-based Payment (FRS 102) relating to share-based
payment takes effect for all listed companies beginning 1 January 2005. Participants will receive
Shares and the Awards would be accounted for as equity-settled share-based transactions, as
described in the following paragraphs.
The fair value of employee services received in exchange for the grant of the Awards will be
recognised as a charge to the income statement over the period between the grant date and the
Vesting Date of an Award. The total amount of the charge over the Vesting period is determined
by reference to the fair value of each Award granted at the grant date and the number of Shares
Vested at the Vesting Date, with a corresponding credit to reserve account. Before the end of
the Vesting period, at each accounting year end, the estimate of the number of Awards that are
expected to Vest by the Vesting Date is subject to revision, and the impact of the revised estimate
will be recognised in the income statement with a corresponding adjustment to the reserve
account. After the Vesting Date, no adjustment to the charge to the income statement is made.
This accounting treatment has been referred to as the modied grant date method because the
number of Shares included in the determination of the expense relating to employee services is
adjusted to reect the actual number of Shares that eventually Vest but no adjustment is made to
changes in the fair value of the Shares since the grant date.
The amount charged to the prot and loss account would be the same whether the Company
settles the Awards by issuing new Shares or by purchasing existing Shares. The amount of the
charge to the income statement also depends on whether or not the performance target attached
to an Award is measured by reference to the market price of the Shares. This is known as a market
condition. If the performance target is a market condition, the probability of the performance target
being met is taken into account in estimating the fair value of the Award granted at the grant date,
and no adjustments to the amounts charged to the income statement are made if the market
condition is not met. However, if the performance target is not a market condition, the fair value
per Share of the Awards granted at the grant date is used to compute the amount to be charged
to the income statement at each accounting date, based on an assessment at that date of whether
the non-market conditions would be met to enable the Awards to vest. Thus, where the Vesting
conditions do not include a market condition, there would be no charge to the income statement if
the Awards do not ultimately Vest.
In the event that the Participants receive cash, our Company shall measure the fair value of the
liability at grant date. Until the liability is settled, our Company shall re-measure the fair value of
the liability at each accounting date and at the date of settlement, with changes in the fair value
recognised in the prot and loss account.
The following sets out the nancial effects of the AsiaPhos Performance Share Plan.
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7.1 Share Capital
The AsiaPhos Performance Share Plan will result in an increase in our Companys issued Shares
where new Shares are issued to Participants. The number of new Shares issued will depend on,
amongst others, the size of the Awards granted under the AsiaPhos Performance Share Plan. In
any case, the AsiaPhos Performance Share Plan provides that the aggregate number of Shares
which may be issued or transferred pursuant to Awards granted under the AsiaPhos Performance
Share Plan, when added to (i) the number of Shares issued and issuable and/ or transferred or
transferable in respect of all Awards granted thereunder; and (ii) all Shares issued and issuable
and/ or transferred or transferable in respect of all options granted or awards granted under any
other share incentive schemes or share plans adopted by the Company for the time being in force,
shall not exceed fteen per cent. (15%) of the entire issued and paid-up share capital (excluding
treasury shares) of our Company on the day preceding the relevant date of the Award. If instead
of issuing new Shares to Participants, treasury shares are transferred to Participants and our
Company pays the equivalent cash value, the AsiaPhos Performance Share Plan would have no
impact on our Companys total number of issued Shares.
7.2 NTA
As described in paragraph 7.3 below on EPS, the AsiaPhos Performance Share Plan is likely to
result in a charge to our Companys prot and loss account over the period from the grant date to
the Vesting Date of the Awards. The amount of the charge will be computed in accordance with the
FRS 102. When new Shares are issued under the AsiaPhos Performance Share Plan, there would
be no effect on the NTA. However, if instead of issuing new Shares to Participants, existing Shares
are purchased for delivery to Participants, or our Company pays the equivalent cash value, the
NTA would be impacted by the cost of the Shares purchased or the cash payment, respectively.
7.3 EPS
The AsiaPhos Performance Share Plan is likely to result in a charge to earnings over the period
from the grant date to the Vesting Date, computed in accordance with the FRS 102.
It should again be noted that the delivery of Shares to Participants of the AsiaPhos Performance
Share Plan will generally be contingent upon the Participants meeting the prescribed performance
targets and conditions.
7.4 Dilutive Impact
It is expected that the AsiaPhos Performance Share Plan will have a dilutive effect on the NTA per
Share and EPS.
8. Participation of Group Executive Directors and Group Executives
The extension of the AsiaPhos Performance Share Plan to Group Executive Directors and Group
Executives allows us to have a fair and equitable system to reward Group Executive Directors and
Group Executives who have made and who continue to make signicant contributions to the long-
term growth of our Group and to inculcate in Participants a stronger and more lasting sense of
identication with our Group.
We believe that the AsiaPhos Performance Share Plan will also enable us to attract, retain
and provide incentives to its Participants to optimise their standards of performance as well as
encourage greater dedication and loyalty by enabling our Company to give recognition to past
contributions and services as well as motivating Participants generally to contribute towards the
long-term growth of our Group.
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9. Participation of Group Non-Executive Directors (including Independent Directors) of our
Company
While the AsiaPhos Performance Share Plan caters principally to Group Employees, it is
recognised that there are other persons who make signicant contributions to the Group through
their close working relationships with our Group, even though they are not employed within our
Group. Such persons include the Group Non-Executive Directors.
The Group Non-Executive Directors are persons from different professions and working
backgrounds, bringing to our Group their wealth of knowledge, business expertise and contracts
in the business community. They play an important role in helping our Group shape its business
strategy by allowing our Group to draw on the backgrounds and diverse working experience of
these individuals. It is crucial for the Company to attract, retain and incentivise the Group Non-
Executive Directors.
We believe that including the Non-Executive Group Directors in the AsiaPhos Performance Share
Plan will show our Companys appreciation for, and further motivate them in, their contribution
towards the success of the Group. However, while it is desired that participation in the AsiaPhos
Performance Share Plan be made open to the Group Non-Executive Directors of the Company,
their services and contributions cannot be measured in the same way as Group Employees.
Accordingly, any Awards that may be granted to any such Group Non-Executive Director would
be intended only as a token of our Companys appreciation. For the purpose of assessing
the contributions of Group Non-Executive Directors, the Committee will propose a performance
framework comprising mainly non-nancial performance measurement criteria such as the extent
of involvement and responsibilities shouldered by Group Non-Executive Directors within the Board.
In addition, the Committee will also consider the scope of advice given by Group Non-Executive
Directors.
It is envisaged that the vesting of Awards, and hence the number of Shares to be delivered to the
Group Non-Executive Directors based on the criteria set out above will be relatively small in terms
of frequency and numbers. Based on this, the Directors are of the view that the participation by the
Group Non-Executive Directors in the AsiaPhos Performance Share Plan will not compromise their
independent status.
The Committee may also decide that no Awards shall be made in any nancial year or no grant
of Award may be made to Group Non-Executive Directors at all. Further, any grant of Award to
Non-Executive Directors will be subject to and shall comply with the provisions of the Act (where
applicable), including the provisions of section 76 of the Act.
10. Participation of Controlling Shareholders or Associates of Controlling Shareholders
The purpose of the participation of Controlling Shareholders and Associates of Controlling
Shareholders in the AsiaPhos Performance Share Plan is to provide an opportunity for eligible
Group Executives (including Group Executive Directors) and Group Non-Executive Directors who
are Controlling Shareholders or Associates of Controlling Shareholders who have contributed or
continue to contribute signicantly to the growth and performance of our Group to participate in the
equity of the Company.
We acknowledge that the services and contributions of the Group Executives (including Group
Executive Directors) and Group Non-Executive Directors who are Controlling Shareholders or
Associates of our Controlling Shareholders are important to the development and success of our
Group. The extension of the AsiaPhos Performance Share Plan to the eligible Group Executives
(including Group Executive Directors) and Group Non-Executive Directors who are Controlling
Shareholders or Associates of our Controlling Shareholders allows our Company to have a fair and
equitable system for rewarding the eligible Group Executives (including Group Executive Directors)
and Group Non-Executive Directors who have made and continue to make important contributions
to the long-term growth of our Group notwithstanding that they are Controlling Shareholders or
Associates of our Controlling Shareholders.
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Although the Controlling Shareholders and/ or their Associates may already have shareholding
interests in the Company, including them in the AsiaPhos Performance Share Plan will ensure that
they are equally entitled with other eligible Group Executives (including Group Executive Directors)
and Group Non-Executive Directors who are not Controlling Shareholders or Associates of
Controlling Shareholders to take part and benet from this system of remuneration. We are of the
view that a person who would otherwise be eligible should not be excluded from participating in the
AsiaPhos Performance Share Plan solely by reason that he/she is a Controlling Shareholders or an
Associate of our Controlling Shareholder.
The specic approval of our independent Shareholders is required for the participation of and the
grant of Awards to such persons as well as the actual number of and terms of such Awards. A
separate resolution must be passed for each such participant. In seeking such approval from our
independent Shareholders, clear justication as to the participation of our Controlling Shareholders
and/ or Associates of our Controlling Shareholders, the number of Shares and terms of the
Awards to be granted to them shall be provided. Accordingly, we are of the view that there are
sufcient safeguards against any abuse of the AsiaPhos Performance Share Plan resulting from
the participation of Controlling Shareholders and Associates of Controlling Shareholders.
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INTERESTED PERSON TRANSACTIONS AND CONFLICTS OF INTEREST
In general, transactions between our Group and any of our Interested Persons (namely, our Directors,
CEO and Executive Director or Controlling Shareholders of our Company and/ or any of their Associates)
are known as Interested Person Transactions.
This section sets out the Interested Person Transactions entered into by our Group for the Period Under
Review and for the period commencing from 1 April 2013 up to the Latest Practicable Date on the basis
of each member of our Group (namely, our Company and our subsidiaries) being an Entity At Risk and
with Interested Persons being construed accordingly.
Save as disclosed in this section and under the section entitled Restructuring Exercise of this Offer
Document, our Group does not have any material transactions with any Interested Person for the Period
Under Review and for the period commencing from 1 April 2013 up to the Latest Practicable Date.
In line with the rules set out in Chapter 9 of the Catalist Rules, a transaction with a value of less than
S$100,000 is not considered material in the context of the Invitation and is not taken into account for the
purposes of aggregation in this section.
PAST INTERESTED PERSON TRANSACTIONS
Transactions with Eastcomm
Advances extended to our Group by Eastcomm
Our CEO and Executive Director, Dr. Ong Hian Eng, is a director and shareholder of Eastcomm,
holding approximately 45.5% of the share capital of Eastcomm. Dr. Ong Hian Eng is also one (1) of our
Controlling Shareholders. The other shareholders of Eastcomm are Astute Ventures, WYY Investment
and Chia Chin Hau. Subsequent to the Restructuring Exercise, our Directors, Simon Ong and Raymond
Ong and our Controlling Shareholder, Melissa Ong will have an indirect interest in Eastcomm. Please
refer to the sections entitled Dilution and Share Capital and Shareholders Shareholders of this Offer
Document for further details on relationships between the shareholders of Eastcomm and the Directors
and Key Executives of our Company.
Since 2009, Eastcomm has been providing advances to our Group for capital expenditure and working
capital requirements. From 1 January 2010 up to the Latest Practicable Date, Eastcomm has provided
advances amounting to an aggregate of S$20,346,400 to our Group for capital expenditure and working
capital requirements (the Advances).
As at 31 December
As at 31
March 2013
Largest amount
outstanding up
to the Latest
Practicable Date (S$000) 2010 2011 2012
Advances 600 2,050 646 14,050
(1)
Note:
(1) Based on month-end balances.
Our Group received a loan in aggregate of S$1,000,000 from Eastcomm in May 2013 for working capital
purposes. Our Directors are of the view this loan was not made on an arms length basis or on normal
commercial terms as it was interest-free, unsecured and had no xed term of repayment. The loan was
repaid in full to Eastcomm in June 2013. We do not intend to enter into similar transactions following our
admission to Catalist.
Approximately S$12,000,000, S$7,000,000 and S$646,400 of the Advances to Norwest Chemicals were
capitalised in December 2011, June 2012 and January 2013, respectively, and 12,000,000, 7,000,000
and 646,400 ordinary shares in the capital of Norwest Chemicals were issued to Eastcomm, respectively.
As at the Latest Practicable Date, we have made full repayment of all Advances. The Advances were
interest-free, unsecured, and had no xed term of repayment. Accordingly, the Advances were not made
on arms length basis or on normal commercial terms. We have since ceased such transactions and do
not intend to enter into similar transactions following our admission to Catalist.
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Share issuance to Eastcomm
4,500,000 and 1,200,000 ordinary shares in the capital of Norwest Chemicals were issued to Eastcomm
in September 2012 and January 2013, respectively (the Share Issuances). The consideration paid
for the Share Issuances was approximately S$4,500,000 and S$1,200,000, respectively. The Share
Issuances were made for working capital purposes, and were not made on an arms length basis or on
normal commercial terms.
Security provided by Eastcomm
In December 2009, Eastcomm granted a charge to OCBC Bank over a xed deposit for the benet of
a credit facility extended by OCBC Bank (China) Limited to Mianzhu Norwest for its working capital
requirements. The said credit facility was fully repaid in March 2011 and the charge was released in June
2011. The principal amount outstanding under the credit facility for the Period Under Review were as
follows:
(S$000)
As at 31 December
As at 31
March 2013
Largest amount
outstanding up
to the Latest
Practicable Date 2010 2011 2012
Total principal
amount
outstanding 912 1,360
(1)
Note:
(1) Based on month-end balances.
As no fees were or will be paid to Eastcomm for the provision of this charge, our Directors are of the view
that this transaction was not carried out on an arms length basis or on normal commercial terms. We do
not intend to enter into similar transactions following our admission to Catalist.
PRESENT AND ON-GOING INTERESTED PERSON TRANSACTIONS
Deed of Indemnity
Dr. Ong Hian Eng (our Controlling Shareholder), Ong Kwee Eng (an Associate of Dr. Ong Hian Eng), and
our Key Executives Wang Xuebo and Chia Chin Hau have signed the Deed of Indemnity, under which
they have jointly and severally undertaken, inter alia, to indemnify and hold harmless our Group against
losses in connection with (i) certain land use rights which may be required in connection with Mianzhu
Norwests Mining Operations for a period of 18 months from the date of our admission to Catalist; (ii)
land use rights for Phase 2 Land; and (iii) the requisite licences, permits and approvals for Commercial
Chemical Production Operations on Phase 2 Land.
As no fees were paid or benets given to the above-mentioned individuals in connection with the Deed of
Indemnity, our Directors are of the view that this transaction was not carried out on an arms length basis
or on normal commercial terms.
Security provided by Eastcomm
As part of the security arrangement for an overdraft facility of S$1 million extended by OCBC Bank to the
Company for general working capital requirements, Eastcomm has granted a charge over its xed deposit
account in favour of OCBC Bank.
As no fees were paid to Eastcomm for the provision of this charge, our Directors are of the view that
this transaction was not carried out on an arms length basis or on normal commercial terms. We do not
intend to enter into similar transactions with Eastcomm following our admission to Catalist.
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REVIEW PROCEDURES FOR FUTURE INTERESTED PERSON TRANSACTIONS
All future interested person transactions will be reviewed and approved in accordance with the threshold
limits set out under Chapter 9 of the Catalist Rules, to ensure that they are carried out on normal
commercial terms and are not prejudicial to our interests and the interests of our minority shareholders.
In the event that such interested person transactions require the approval of our Board and the Audit
Committee, relevant information will be submitted to the Board or the Audit Committee for review.
In the event that such Interested Person Transactions require the approval of shareholders, additional
information may be required to be presented to shareholders and an independent nancial adviser may
be appointed for an opinion.
To ensure that all future Interested Person Transactions are carried out on normal commercial terms and
will not be prejudicial to the interests of our Group or our minority Shareholders, the following procedures
will be implemented by our Group:
(a) in case of purchasing any products or engaging any services from an Interested Person, two (2)
other quotations from non-interested persons will be obtained for comparison to ensure that the
interests of Shareholders are not disadvantaged. The purchase price or fee for services shall not
be higher than the most competitive price or fee of the two (2) other quotations from non-interested
persons. In determining the most competitive price or fee, all pertinent factors, including but not
limited to quality, requirements, specications, delivery time and track record will be taken into
consideration;
(b) in case of selling any products or supplying any services to an Interested Person, the price or fee
and terms of two (2) other successful transactions of a similar nature with non-interested persons
shall be used as comparison to ensure that the interests of Shareholders are not disadvantaged.
The price or fee for the supply of products or services shall not be lower than the lowest price or
fee of the two (2) other successful transactions with non-Interested Persons;
(c) in case of renting properties from or to an Interested Person, appropriate steps will be taken to
ensure that such rent is matched with prevailing market rates, including adopting measures such
as making relevant enquiries with landlords of similar properties and obtaining suitable valuations,
reports or reviews published by property agents (where necessary). The rent payable shall
be based on the most competitive market rental rates of similar properties in terms of size and
location, based on the results of the relevant enquiries;
(d) in case of transactions which involve payments on a reimbursement basis, appropriate steps will
be taken to ensure that our Group determines on a monthly basis the relevant cost amounts to pay
based on objective documentation such as tax invoices;
(e) where it is not possible to compare against the terms of other transactions with unrelated third
parties and given that the products and/ or services may be purchased only from an Interested
Person, the Interested Person Transaction will be approved by any of our other Directors who has
no interest in the transaction, in accordance with our Groups usual business practices and policies.
In determining the transaction price payable to the Interested Person for such products and/ or
service, factors such as, but not limited to, quantity, requirements and specications will be taken
into account; and
(f) in addition, we shall monitor all Interested Person Transactions entered into by us and categorise
these transactions as follows:
(i) a Category 1 Interested Person Transaction is one where the value thereof is in excess of or
equal to three per cent. (3%) of the NTA of our Group; and
(ii) a Category 2 Interested Person Transaction is one where the value thereof is below three
per cent. (3%) of the NTA of our Group.
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All Category 1 Interested Person Transactions must be approved by our Audit Committee prior to entry
whereas Category 2 Interested Person Transactions need not be approved by our Audit Committee prior
to entry but shall be reviewed on a quarterly basis by our Audit Committee.
Our Audit Committee will review all Interested Person Transactions, if any, on a quarterly basis to ensure
that they are carried out on normal commercial terms, are not prejudicial to the interests of our Group or
our minority Shareholders and in accordance with the procedures outlined above. It will take into account
all relevant non-quantitative factors. In the event that a member of our Audit Committee is interested in
any such transaction, he will abstain from participating in the review and approval process in relation to
that particular transaction.
Our Company shall prepare all the relevant information to assist our Audit Committee in its review and
will keep a register to record all Interested Person Transactions. The register shall also record the basis
for entry into the transactions, including the quotations and other evidence obtained to support such basis
and the procedures used to determine the terms of the transactions and whether the terms are normal
commercial terms and not prejudicial to the interests of our minority Shareholders.
Disclosure will be made in our Companys annual report of the aggregate value of Interested Person
Transactions during the nancial year under review.
In addition, our Audit Committee will include the review of Interested Person Transactions as part of
the standard procedures while examining the adequacy of our internal controls. Our Board will also
comply with the provisions in Chapter 9 of the Catalist Rules in respect of all future Interested Person
Transactions, and if required under the Catalist Rules, we will seek our Shareholders approval for such
transactions.
POTENTIAL CONFLICTS OF INTERESTS
In general, a conict of interest arises when any of our Directors, Controlling Shareholders or their
Associates is carrying on or has any interest in any other corporation carrying on the same business or
dealing in similar products or services as our Group. Save as disclosed below and in this section entitled
Interested Person Transactions and Conicts of Interests of this Offer Document, none of our Directors,
Controlling Shareholders, Key Executives and/ or any of their Associates has any material interest,
whether direct or indirect, in:
(a) any transactions to which our Company and our subsidiaries were or are a party;
(b) any company carrying on the same business or dealing in similar products or services as our
Group; and
(c) in any enterprise or company that is our customer or supplier of goods or services.
To the best of our knowledge, none of our Directors, Controlling Shareholders, Key Executives and/ or
any of their Associates are involved in the management of any company involved in a similar or related
business as our Group.
We also believe that any unforeseen potential conicts of interests arising in the future may be mitigated
as follows:
(a) our Directors have a duty to disclose their interests in respect of any contract, proposal,
transaction or any other matter whatsoever in which they have any personal material interest,
directly or indirectly, or any actual or potential conicts of interest (including conicts of interest
that arise from their directorship(s) or executive position(s) or personal investments in any other
corporation(s)) that may involve them. Upon such disclosure, such Directors shall not participate in
any proceedings of our board of Directors, and shall in any event abstain from voting in respect of
such contract, arrangement, proposal, transaction or matter in which the conict of interest arises,
unless and until our Audit Committee has determined that no such conict of interest exists;
194
(b) our Audit Committee is required to examine the internal guidelines and procedures put in place
by our Company to determine if such guidelines and procedures are sufcient to ensure that
interested person transactions are conducted on normal terms and will not be prejudicial to our
Group or our minority Shareholders;
(c) our Audit Committee will review any actual or potential conicts of interest that may involve our
Directors as disclosed by them to our board of Directors, and the exercise of Directors duciary
duties in this respect. Upon disclosure of an actual or potential conict of interests by a Director,
our Audit Committee will consider whether a conict of interests does in fact exist. A Director who
is a member of our Audit Committee will not participate in any proceedings of our Audit Committee
in relation to the review of a conict of interests relating to him. The review will include an
examination of the nature of the conict and such relevant supporting data, as our Audit Committee
may reasonably deem necessary;
(d) our Directors owe duciary duties to us, including the duty to act in good faith and in our interests;
and
(e) our Audit Committee will, following the listing of our Company on Catalist, undertake the following
additional responsibilities:
(i) review on a periodic basis the framework and processes established for the implementation
of the terms of the undertakings in order to ensure that such framework and processes
remain appropriate;
(ii) review and assess from time to time whether additional processes are required to be put
in place to manage any material conicts of interests and propose, where appropriate, the
relevant measures for the management of such conicts; and
(iii) review and resolve all conicts of interests referred to it.
Dr. Ong Hian Eng as a non-executive director in Hwa Hong
Our CEO and Executive Director, Dr. Ong Hian Eng, is currently a substantial shareholder of Hwa Hong,
and a non-executive director of Hwa Hong and certain subsidiaries of Hwa Hong. We believe that there
will be minimal conicts of interests, in terms of time commitment and business activities, arising from Dr.
Ong Hian Engs directorships and interests in both the Hwa Hong Group and our Group.
In terms of competing time commitments, as Dr. Ong Hian Eng is a non-executive director of Hwa Hong,
he will not be involved in the day-to-day operations of Hwa Hong. As such, our Board is of the opinion
that Dr. Ong Hian Eng will be able to adequately carry out his duties as an Executive Director of the
Company.
To the best of our knowledge, the principal business of the Hwa Hong Group is in property investments
and development, and it currently does not carry on the same business or deal in similar products or
services as our Group. Save as described in this section entitled Interested Person Transactions and
Conicts of Interest of this Offer Document, the Hwa Hong Group is also not a customer of, or supplier
to, our Group.
In the event that a conict of interests arises in the future, Dr. Ong Hian Eng will disclose his interests
to our Board and will abstain from participating in discussions involving, and voting on, matters in which
he may be interested, as well as maintaining the condentiality of such matters. If required by our Audit
Committee, Dr. Ong Hian Eng will step down as director of Hwa Hong.
In the event that our Group enters into transactions with the Hwa Hong Group in the future, our Audit
Committee will review all such transactions in accordance with the review procedures detailed in this
section entitled Interested Person Transactions and Conicts of Interest Review Procedures for Future
Interested Person Transactions of this Offer Document, and Dr. Ong Hian Eng, as a Board member, will
abstain from voting on deliberations by our Board relating to such transactions.
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CLEARANCE AND SETTLEMENT
Upon listing and quotation on Catalist, our Shares will be traded under the book-entry settlement system
of CDP and all dealings in and transactions of the Shares through Catalist will be effected in accordance
with the terms and conditions for the operation of Securities Accounts with CDP, as amended from time to
time.
Our Shares will be registered in the name of CDP or its nominee and held by CDP for and on behalf
of persons who maintain, either directly or through depository agents, Securities Accounts with CDP.
Persons named as direct Securities Account holders and depository agents in the depository register
maintained by CDP, rather than CDP itself, will be treated, under our Articles of Association and the
Companies Act, as members of our Company in respect of the number of Shares credited to their
respective Securities Accounts.
Persons holding our Shares in a Securities Account with CDP may withdraw the number of Shares
they own from the book-entry settlement system in the form of physical share certicate(s). Such share
certicates will, however, not be valid for delivery pursuant to trades transacted on Catalist, although they
will be prima facie evidence of title and may be transferred in accordance with our Articles of Association.
A fee of S$10.00 for each withdrawal of 1,000 Shares or less and a fee of S$25.00 for each withdrawal
of more than 1,000 Shares is payable upon withdrawing our Shares from the book-entry settlement
system and obtaining physical share certicates. In addition, a fee of S$2.00 or such other amount as
our Directors may decide, is payable to the Share Registrar for each share certicate issued and a stamp
duty of S$10.00 is also payable where our Shares are withdrawn in the name of the person withdrawing
our Shares or S$0.20 per S$100.00 or part thereof of the last-transacted price where it is withdrawn
in the name of a third party. Persons holding physical share certicates who wish to trade on Catalist
must deposit with CDP their share certicates together with the duly executed and stamped instruments
of transfer in favour of CDP and have their respective Securities Accounts credited with the number of
Shares deposited before they can effect the desired trades. A deposit fee of S$10.00 is payable upon the
deposit of each instrument of transfer with CDP.
Transactions in our Shares under the book-entry settlement system will be reected by the sellers
Securities Account being debited with the number of Shares sold and the buyers Securities Account
being credited with the number of Shares acquired. No transfer stamp duty is currently payable for Shares
that are settled on a book-entry basis.
A Singapore clearing fee for trades in our Shares on Catalist is payable at the rate of 0.04% of the
transaction value subject to a maximum of S$600.00 per transaction. The clearing fee, instrument of
transfer, deposit fee and share withdrawal fee are subject to GST currently at seven per cent. (7.0%).
Dealings of our Shares will be carried out in S$ and will be effected for settlement through CDP on a
scripless basis. Settlement of trades on a normal ready basis on Catalist generally takes place on the
third Market Day following the transaction date and payment for the securities is generally settled on the
following business day. CDP holds securities on behalf of investors in Securities Accounts. An investor
may open a direct account with CDP or a sub-account with a CDP depository agent. The CDP depository
agent may be a member company of the SGX-ST, bank, merchant bank or trust company.
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GENERAL AND STATUTORY INFORMATION
INFORMATION ON DIRECTORS AND KEY EXECUTIVES
1. Save as disclosed below, as at the date of this Offer Document, none of our Directors, Key
Executives or Controlling Shareholders has:
(a) at any time during the last ten (10) years, had an application or a petition under any
bankruptcy laws of any jurisdiction led against him or against a partnership of which he was
a partner at the time when he was a partner or at any time within two (2) years from the date
he ceased to be a partner;
(b) at any time during the last ten (10) years, had an application or a petition under any law of
any jurisdiction led against an entity (not being a partnership) of which he was a director or
an equivalent person or a key executive, at the time when he was a director or an equivalent
person or a key executive of that entity or at any time within two (2) years from the date
he ceased to be a director or an equivalent person or a key executive of that entity, for the
winding up or dissolution of that entity or, where that entity is the trustee of a business trust,
that business trust, on the ground of insolvency;
(c) any unsatised judgment against him;
(d) ever been convicted of any offence, in Singapore or elsewhere, involving fraud or dishonesty,
which is punishable with imprisonment, or has been the subject of any criminal proceedings
(including any pending criminal proceedings of which he is aware) for such purpose;
(e) ever been convicted of any offence, in Singapore or elsewhere, involving a breach of any law
or regulatory requirement that relates to the securities or futures industry in Singapore or
elsewhere, or been the subject of any criminal proceedings (including any pending criminal
proceedings of which he is aware) for such breach;
(f) at any time during the last ten (10) years, had judgment entered against him in any civil
proceedings in Singapore or elsewhere involving a breach of any law or regulatory
requirement that relates to the securities or futures industry in Singapore or elsewhere, or
a nding of fraud, misrepresentation or dishonesty on his part, or been the subject of any
civil proceedings (including any pending civil proceedings of which he is aware) involving an
allegation of fraud, misrepresentation or dishonesty on his part;
(g) ever been convicted in Singapore or elsewhere of any offence in connection with the
formation or management of any entity or business trust;
(h) ever been disqualied from acting as a director or an equivalent person of any entity
(including the trustee of a business trust), or from taking part directly or indirectly in the
management of any entity or business trust;
(i) ever been the subject of any order, judgment or ruling of any court, tribunal or governmental
body, permanently or temporarily enjoining him from engaging in any type of business
practice or activity;
(j) ever, to his knowledge, been concerned with the management or conduct, in Singapore or
elsewhere, of the affairs of:
(i) any corporation which has been investigated for a breach of any law or regulatory
requirement governing corporations in Singapore or elsewhere;
(ii) any entity (not being a corporation) which has been investigated for a breach of any
law or regulatory requirement governing such entities in Singapore or elsewhere;
197
(iii) any business trust which has been investigated for a breach of any law or regulatory
requirement governing business trusts in Singapore or elsewhere; or
(iv) any entity or business trust which has been investigated for a breach of any law or
regulatory requirement that relates to the securities or futures industry in Singapore or
elsewhere,
in connection with any matter occurring or arising during the period when he was so
concerned with the entity or business trust; or
(k) been the subject of any current or past investigation or disciplinary proceedings, or has
been reprimanded or issued any warning, by the Authority or any other regulatory authority,
exchange, professional body or governmental agency, whether in Singapore or elsewhere.
Disclosure relating to our CEO and Executive Director, Dr. Ong Hian Eng
(a) Dr. Ong Hian Eng was on the board of directors of Norwest Holdings, an associated
company of the Hwa Hong Group, from 25 September 1996 to 9 January 2008. Norwest
Chemicals was incorporated as a wholly-owned subsidiary of Norwest Holdings.
In 2008, one of Norwest Holdings shareholders and its main creditor, HHEO (a subsidiary
of the Hwa Hong Group), applied for Norwest Holdings to be liquidated (the Winding Up
Order). For further details, please refer to the section entitled General Information on our
Group History of this Offer Document.
Prior to the Winding Up Order, Dr. Ong Hian Eng held 5.0%, and HHEO held 49.5%, of
the shareholding of Norwest Holdings. HHEO is in turn wholly-owned by Hwa Hong. Dr.
Ong Hian Eng is a director of HHEO and Hwa Hong. Dr. Ong Hian Eng also holds, directly
and indirectly, an aggregate of approximately 6.5% of the share capital of Hwa Hong, and
together with his immediate family, has an interest of more than 30% in the share capital of
Hwa Hong.
In May 2008, the liquidator of Norwest Holdings accepted an offer by Newport Mining
(now known as Aguia Resources Limited), a company listed on the Australian Securities
Exchange. However the acquisition by Newport Mining was not completed due to, inter alia,
the Wenchuan Earthquake. On 2 August 2008, HHEO acquired Norwest Chemicals via an
auction held by the liquidator of Norwest Holdings. On the same day, Eastcomm (which was
then wholly-owned by our CEO and Executive Director, Dr. Ong Hian Eng), acquired Norwest
Chemicals from HHEO.
(b) Dr. Ong Hian Eng was on the board of directors of Hwa Hong Capital (Pte) Limited (Hwa
Hong Capital), a wholly-owned subsidiary of Hwa Hong since 31 December 1993. As at 10
May 2012, Hwa Hong Capital had been dissolved pursuant to a members voluntary winding
up.
(c) Dr. Ong Hian Eng was a non-executive director on the board of directors of Tenet Insurance
Company Ltd (Tenet Insurance) from 18 February 2002 to 31 May 2010. Due to the
nature of business of Tenet Insurance, from time to time, Tenet Insurance was involved in
several litigation suits during Dr. Ong Hian Engs directorship tenure. These litigation suits
included suits relating to contract and insurance in the ordinary course of business of Tenet
Insurance.
(d) Dr. Ong Hian Eng was on the board of directors of 01-Labs.Com Pte Ltd (01-Labs) since
4 May 2000. As at 20 July 2004, 01-Labs had been dissolved pursuant to a members
voluntary winding up.
(e) Dr. Ong Hian Eng was a director of AsiaPhos Holdings Pte Ltd (AsiaPhos Holdings)
between 3 January 2012 and 5 June 2012. AsiaPhos Holdings was a dormant company and
was struck off due to inactivity on 5 June 2012.
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Disclosure relating to our CEO and Executive Director, Dr. Ong Hian Eng, Executive Director,
Simon Ong, and Non-Executive Director, Raymond Ong
Dr. Ong Hian Eng and Raymond Ong (alternate director to Ong Kwee Eng) were on the board of
directors, and Simon Ong was a joint liquidator in relation to the winding up, of the following family-
owned investment holding vehicles:
(a) Ong Holdings (Private) Limited (Ong Holdings)
Dr. Ong Hian Eng and Raymond Ong were appointed to the board of directors of Ong
Holdings since 17 August 1993 and 29 June 2001, respectively. Ong Holdings commenced
the members voluntary winding up process on 30 November 2010, and Simon Ong was
appointed as a joint liquidator of Ong Holdings on the same date. As at 30 October 2012,
Ong Holdings had been dissolved.
(b) Bee Tong Trading Company Private Limited (Bee Tong)
Dr. Ong Hian Eng and Raymond Ong were appointed to the board of directors of Bee Tong
since 17 August 1993 and 17 June 1999, respectively. Bee Tong commenced the members
voluntary winding up process on 30 November 2010 and Simon Ong was appointed as a
joint liquidator. As at 16 August 2012, Bee Tong had been dissolved.
(c) International Foundation Engineering Pte. Ltd. (IFE)
Dr. Ong Hian Eng and Raymond Ong were appointed to the board of directors of IFE since
17 August 1993 and 17 June 1999, respectively. IFE commenced the members voluntary
winding up process on 30 November 2010 and Simon Ong was appointed as a joint
liquidator. As of 16 August 2012, IFE had been dissolved.
Disclosure relating to our CEO and Executive Director, Dr. Ong Hian Eng, and Key
Executive, Wang Xuebo
(a) (Rizhao Oriental Peanut Food Co., Ltd.) (Rizhao Oriental) is a
PRC-incorporated company established as a joint venture between
(China Shandong National Cereals, Oils and Foodstuffs Import and Export Corporation)
and HHEO, each holding 51% and 49% equity interests in Rizhao Oriental, respectively. Dr.
Ong Hian Eng and Wang Xuebo were appointed as directors of Rizhao Oriental between
23 March 2000 and 15 May 2012 as representatives of HHEO and were not involved in the
day-to-day management of Rizhao Oriental. During the tenure of Dr. Ong Hian Engs and
Wang Xuebos directorships in Rizhao Oriental, Rizhao Oriental was involved in litigation
suits related to, inter alia, the settlement of certain outstanding debts. Dr. Ong Hian Eng and
Wang Xuebo did not assume any legal liability in respect of such debts and are not aware
of the outcome of the litigation suits. To the best of Dr. Ong Hian Engs and Wang Xuebos
knowledge, Rizhao Oriental has not been engaged in any business since 2008.
(b) (Jining Ningfeng Chemical Industry Co. Ltd.) (Jining Ningfeng)
is a PRC-incorporated company as a wholly-owned subsidiary of HHEO. In 2006, Jining
Ningfeng was involved in litigation suits relating to the settlement of outstanding debts
amounting to approximately RMB900,000. During the relevant period, Dr. Ong Hian Eng and
Wang Xuebo were directors of Jining Ningfeng as representatives of HHEO. Dr. Ong Hian
Eng was also its legal representative. Dr. Ong Hian Eng and Wang Xuebo did not assume
any legal liability in respect of such debts. Dr. Ong Hian Eng and Wang Xuebo are not aware
of the outcome of the litigation suits. To the best of Dr. Ong Hian Engs and Wang Xuebos
knowledge, Jining Ningfeng has not been engaged in any business since 2006.
Disclosure relating to our Independent Director, Hong Pian Tee
Hong Pian Tee was an independent director of Asia Food & Properties Limited (now known as
Sinarmas Land Limited) (AFP and collectively with its subsidiaries, the AFP Group) between
November 2001 and February 2006. To the best of Hong Pian Tees knowledge, prior to his
appointment as independent director of AFP, the AFP Group made deposits of approximately
S$239 million with related parties (the Deposits). To the best of Hong Pian Tees knowledge,
199
the Commercial Affairs Department of Singapore (CAD) commenced investigations into AFP in
relation to the Deposits in December 2001 and ended the investigations in January 2004. Hong
Pian Tee was not involved in any way whatsoever on any matters related to the Deposits. In
addition, Hong Pian Tee was not involved in or called up for investigations by the CAD during the
period of investigations.
Disclosure relating to our Independent Director, Francis Lee
Francis Lee was an investment and project manager of AP Oil International Limited (AP Oil)
between June 2004 and June 2005. To the best of Francis Lees knowledge, the CAD commenced
investigations into certain insider trading transactions which occurred sometime in 2004 involving
certain directors of AP Oil. Francis Lee was called up to assist the CAD during the period of
investigations, and to the best of his knowledge was not the subject of the investigations.
General Disclosure relating to our Directors
Our Directors, other than Goh Yeow Tin and Francis Lee, have held directorships in companies
outside our Group which have committed statutory breaches relating to late ling of annual returns
with ACRA and late ling of appointments of ofcers with the relevant authorities at various times
in the past. Where penalties were imposed on these companies, they did not amount to more than
S$500 each.
General Disclosure relating to our Group
(a) In November 2010, Norwest Chemicals wrote to IRAS disclosing details of an inadvertent
omission to account for withholding tax on certain remuneration paid in 2009 to a non-
resident director (as required under Section 45B of the Income Tax Act, Chapter 134, of
Singapore) and voluntarily paid to IRAS the said tax as well as the penalty thereof. A one-
time penalty of not more than S$2,000 was paid. Our CEO and Executive Director, Dr. Ong
Hian Eng, Non-Executive Director, Raymond Ong and Key Executive, Chia Chin Hau, were
directors of Norwest Chemicals at the material time.

(b) Norwest Chemicals had been ned by ACRA in the past and had paid penalties ranging from
S$50 to S$500 for late ling of its annual returns with ACRA at various times in the past. Our
CEO and Executive Director, Dr. Ong Hian Eng and Non-Executive Director, Raymond Ong,
were directors of Norwest Chemicals at the material time.
2. There is no shareholding qualication for Directors under the Articles of Association of our
Company.
3. Save as disclosed in the section entitled Restructuring Exercise of this Offer Document, none of
our Directors are interested, directly or indirectly, in the promotion of, or in any property or assets
which have, within the two (2) years preceding the date of this Offer Document, been acquired
or disposed of by or leased to, our Company or any of our subsidiaries, or are proposed to be
acquired or disposed of by or leased to our Company or any of our subsidiaries.
4. No sum or benet has been paid or is agreed to be paid to any Director or expert, or to any rm in
which such Director or expert is a partner or any corporation in which such Director or expert holds
shares or debentures, in cash or shares or otherwise, by any person to induce him to become,
or to qualify him as, a Director, or otherwise for services rendered by him or by such rm or
corporation in connection with the promotion or formation of our Company.
5. Save as disclosed in the section entitled Management and Corporate Governance Service
Agreements of this Offer Document, there are no existing or proposed service contracts between
our Directors and our Company or any of our subsidiaries.
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SHARE CAPITAL
6. As at the date of this Offer Document, there is only one (1) class of shares in the capital of our
Company. The rights and privileges attached to our Shares are stated in the Memorandum of
Association and Articles of Association of our Company. There are no founder, management or
deferred shares. Substantial Shareholders of our Company are not entitled to any different voting
rights from the other shareholders.
7. Except as disclosed in the sections entitled Share Capital and Shareholders and Restructuring
Exercise of this Offer Document, there were no changes in the issued and paid-up capital of the
Company and its subsidiaries (not including transfers) within the three (3) years preceding the
Latest Practicable Date.
8. Except as disclosed in the sections entitled Share Capital and Shareholders and Restructuring
Exercise of this Offer Document, no shares in, or debentures of, our Company or any of our
subsidiaries have been issued, or are proposed to be issued, as fully or partly paid for cash or for a
consideration other than cash, during the last three (3) years preceding the date of lodgment of this
Offer Document.
9. Except as disclosed in the sections entitled Restructuring Exercise and Dilution of this Offer
Document, no option to subscribe for Shares in, or debentures of, our Company or our subsidiaries
has been granted to, or was exercised by, any Director or Key Executive in the two (2) nancial
years preceding the date of this Offer Document.
10. Except as disclosed in the sections entitled Restructuring Exercise and Dilution of this Offer
Document, no person has been, or has the right to be, given an option to subscribe for or purchase
any securities of our Company or any of our subsidiaries.
11. Except as disclosed in the sections entitled Capitalisation and Indebtedness and Managements
Discussion and Analysis of Results of Operations and Financial Position Liquidity and
Capital Resources of this Offer Document, we have, as at the Latest Practicable Date, no other
borrowings or indebtedness in the nature of borrowings including bank overdrafts and liabilities
under acceptances (other than normal trading credits) or acceptances credits, mortgages, charges,
hire purchase commitments, guarantees or other material contingent liabilities.
MEMORANDUM AND ARTICLES OF ASSOCIATION
12. Our Company is registered in Singapore with ACRA with registration number 201200335G.
A summary of our Articles of Association relating to, inter alia, Directors powers to vote on
contracts in which they are interested, Directors remuneration, Directors borrowing powers,
Directors retirement, Directors share qualication, rights pertaining to shares, convening of general
meetings and alteration of capital are set out in Appendix D to this Offer Document. Our Articles
of Association are available for inspection at our registered ofce in accordance with paragraph 38
in the section entitled General and Statutory Information Documents Available for Inspection of
MATERIAL CONTRACTS
13. The dates of, parties to and general nature of the material contracts, not being contracts entered
into in the ordinary course of business, entered into by any member of our Group within two (2)
years preceding the date of lodgment of this Offer Document, and the amount of any consideration
passing to or from any member of our Group, as the case may be, under such contracts are as
follows:
(a) the contract for assignment of the state-owned construction land use right dated 18 October
2011 entered into between Mianzhu Norwest and the Mianzhu Land Bureau pursuant
to which Mianzhu Norwest shall be assigned the land use right for Phase 1 Land for an
aggregate consideration of approximately RMB 8,229,000;
201
(b) the contract for assignment of the state-owned construction land use right dated 6 January
2013 entered into between Mianzhu Norwest and the Mianzhu Land Bureau pursuant to
which Mianzhu Norwest shall be assigned the land use right for the Hanwang Land for an
aggregate consideration of approximately RMB 2,573,700;
(c) the Restructuring Agreement. Please refer to the section entitled Restructuring Exercise of
this Offer Document for further details;
(d) the Deed of Indemnity. Please refer to the section entitled Restructuring Exercise of this
Offer Document for further details; and
(e) the Service Agreements. Please refer to the section entitled Management and Corporate
Governance Service Agreements of this Offer Document for further details.
Save as disclosed above, our Group has not entered into any material contracts, not being
contracts entered into in the ordinary course of business, within the two (2) years preceding the
date of lodgment of this Offer Document.
LITIGATION
14. To the best of our knowledge and belief, having made all reasonable enquiries, neither we nor
any of our subsidiaries are engaged in any legal or arbitration proceedings, including those which
are pending or known to be contemplated, which may have, or which have had, in the 12 months
immediately preceding the date of lodgment of this Offer Document, a material effect on our
nancial position or protability.
Following the completion of the construction of the P
4
Plant in 2012, Mianzhu Norwest has been
engaged in discussions with (Sichuan Qian Kun Construction
Group Co., Ltd.) (Qian Kun), one of Mianzhu Norwests construction contractors, to determine
the aggregate amount payable by Mianzhu Norwest for certain construction works performed
and completed by Qian Kun (which includes works carried out pursuant to variation orders).
Arbitration proceedings commenced by Qian Kun were accepted by the (Deyang
Arbitration Commission) (DAC) on 27 August 2013, and a (notice to participate
in arbitration) was received by Mianzhu Norwest on 5 September 2013. Based on the
(settlement document) dated 5 September 2013 issued by the DAC, Qian Kun and Mianzhu
Norwest agreed that the aggregate amount payable for all construction works performed and
completed by Qian Kun would be RMB 35 million, and that as RMB 26 million had already
been paid by Mianzhu Norwest prior to the arbitration proceedings, Mianzhu Norwest would pay
the balance RMB 9 million as follows: (i) RMB 4.5 million before 29 January 2014, and (ii) RMB
4.5 million before 30 April 2014. The arbitration and related costs were stipulated in the
(settlement document) to be borne by Qian Kun. Mianzhu Norwest had, in its FY2012 and FP2013
accounts, made adequate provision for the payment of the aforesaid balance of RMB 9 million. Our
Directors are of the view that the payment(s) to, and dispute(s) with, Qian Kun do not and will not
have a material effect on the nancial position or protability of our Group.
15. From time to time, we are subject to personal injury claims by workers who were involved
in accidents at our worksite during the course of their work. Generally, such claims are settled
through our insurers pursuant to the workmen compensation scheme or pursuant to a claim under
the applicable PRC laws, rules and regulations.
202
MISCELLANEOUS
16. The details of our Groups subsidiaries are set out in the section entitled Our Group Structure of
17. There has been no previous issue of Shares by our Company or offer for sale of its Shares to the
public since its incorporation.
18. There has been no public take-over offer by a third party in respect of our Shares or by our
Company in respect of shares of another corporation or units of a business trust which has
occurred between the beginning of the most recent completed nancial year and the Latest
Practicable Date.
19. Save as disclosed in this Offer Document, as at the Latest Practicable Date, none of the properties
owned by our Company and our subsidiaries are encumbered.
20. Save as disclosed in this Offer Document, as at the Latest Practicable Date, our Directors are not
aware of any relevant material information including trading factors or risks which are unlikely to
be known or anticipated by the general public and which could materially affect the prots of our
Company and our subsidiaries.
21. Save as disclosed in this Offer Document, the nancial condition and operations of our Group are
not likely to be affected by any of the following:
(a) known trends or known demands, commitments, events or uncertainties that will result in or
are reasonably likely to result in our Groups liquidity increasing or decreasing in any material
way;
(b) material commitments for capital expenditures;
(c) unusual or infrequent events or transactions or any signicant economic changes or new
developments, which may materially affect the amount of reported income from operations;
and
(d) known trends, uncertainties, demands, commitments or events that are reasonably likely to
have a material effect on net sales or revenues, protability, liquidity or capital resources or
operating income or that would cause nancial information disclosed in the Offer Document
to be not necessarily indicative of the future operating results or nancial condition of our
Group.
22. Save as disclosed in this Offer Document, our Directors are not aware of any event which has
occurred since the end of FP2013 to the Latest Practicable Date which may have a material effect
on the nancial position and results of our Group or the nancial information provided in this Offer
Document.

23. In the opinion of our Directors, there are no minimum amounts which must be raised by the issue
of the New Shares. Although no minimum amount must be raised by the Invitation, such amounts
which are proposed to be provided out of the proceeds of the New Shares shall, in the event the
Invitation is cancelled and the proposed expansion plan proceeds, be provided out of the existing
banking facilities and/ or internal funds generated from operations.
203
24. The details, including name, address and professional qualications of the Auditors and Reporting
Accountants of our Company since incorporation are as follows:
Name and address Professional body
Partner-in-charge /
Professional qualication
Ernst & Young LLP
Public Accountants and
Chartered Accountants
One Rafes Quay
North Tower, Level 18
Singapore 048583
Institute of Singapore
Ng Boon Heng (Chartered
Accountant, a member of the
Institute of Singapore Chartered
Accountants)
We currently have no intention of changing our auditors after the listing of our Company on Catalist.
INTERESTS OF EXPERTS AND UNDERWRITER
25. No expert is employed on a contingent basis by our Company or any of our subsidiaries, or has a
material interest, whether direct or indirect, in the shares of our Company or our subsidiaries, or
has a material economic interest, whether direct or indirect, in our Company including an interest in
the success of the Invitation.
26. In the reasonable opinion of our Directors, UOB, the Sponsor and Underwriter, does not have a
material relationship with our Group save as disclosed below:
(a) UOB has been appointed to sponsor and manage the Invitation and is the Underwriter of the
Invitation and as disclosed in the section entitled Management, Underwriting and Placement
Arrangements of this Offer Document;
(b) UOB has been appointed to be the continuing sponsor of our Company for an initial period
of three (3) years from the date our Company is admitted and listed on Catalist;
(c) UOB is the Receiving Bank of the Invitation; and
(d) UOB, its subsidiaries, associated companies and/ or its afliates (including UOB Kay
Hian Holdings Limited) (UOB Group of Companies) may, in the ordinary course of
business, extend credit facilities or engage in commercial banking, investment banking,
private banking, securities trading, asset and funds management, research, insurance
and/ or advisory services with any member of our Group, their respective afliates and/
or our Shareholders, and may receive a fee in respect thereof. In addition, in the ordinary
course of business, any member of the UOB Group of Companies may at any time offer
or provide services to or engage in any transactions (on its own account or otherwise) with
any member of our Group, their respective afliates, our Shareholders, or any other entity
or person, and may receive a fee in respect thereof. This may include but is not limited to,
holding long or short positions in securities issued by any member of our Group and their
respective afliates, and trading or otherwise effecting transactions, for its own account or
the accounts of its customers, in debt or equity (or related derivative instruments) of any
member of our Group and their respective afliates.
27. In the reasonable opinion of our Directors, Asiasons, the Placement Agent, does not have a
material relationship with our Group save that Asiasons is the Placement Agent for the Invitation
and as disclosed in the section entitled Management, Underwriting and Placement Arrangements
of this Offer Document.
204
28. Application monies received by our Company in respect of all successful applications will be placed
in a separate non-interest bearing account with UOB (the Receiving Bank). In the ordinary
course of business, the Receiving Bank will deploy these monies in the inter-bank money market.
All prots derived from the deployment of such monies will accrue to the Receiving Bank. Any
refund of all or part of the application monies to unsuccessful or partially successful applicants
will be made at the applicants own risk, without any interest or any share of revenue or any other
benet arising therefrom, and the applicants will not have any claim against us, the Vendors, the
Sponsor and Underwriter or the Placement Agent.
CONSENTS
29. The Independent Auditors and Reporting Accountants have given and have not withdrawn their
written consent to the issue of this Offer Document with the inclusion herein of the Independent
Auditors Report on the Audited Combined Financial Statements for the nancial years ended 31
December 2010, 2011 and 2012, the Independent Auditors Review Report on the Unaudited
Interim Condensed Combined Financial Statements for the three months period ended 31 March
2013 and the Independent Auditors Report on the Unaudited Pro Forma Combined Financial
Information for the nancial year ended 31 December 2012 and the three months period ended
31 March 2013 set out in Appendix A, Appendix B and Appendix C to this Offer Document,
respectively, in the form and context in which such reports are included, and with the inclusion
of its name and all reference thereto in the form and context in which they appear in the Offer
Document and to act in such capacity in relation to this Offer Document. The above reports were
prepared for the purpose of incorporation in this Offer Document.
30. King & Wood Mallesons, the Legal Advisers to our Company on PRC Law, has given and has not
withdrawn its written consent to the issue of this Offer Document, with the inclusion herein of its
name and all references thereto, and its opinions in relation to PRC law set out in the sections
entitled Risk Factors; Dividend Policy; General Information on our Group Mining Operations
approvals and permits; General Information on our Group Properties leased by our Group;
and General Information on our Group Legal Opinion from King & Wood Mallesons of this Offer
Document in the form and context in which they appear in this Offer Document, and to act in such
capacity in relation to this Offer Document. The above opinions were prepared for the purpose of
incorporation in this Offer Document.
31. WGM, the Independent Geologist, has given and has not withdrawn its written consent to the issue
of this Offer Document with the inclusion herein of its name and all references thereto and the
WGM Technical Report included in Appendix J to this Offer Document, in the form and context
in which they appear in this Offer Document and to act in such capacity in relation to this Offer
Document. The above report was prepared for the purpose of incorporation in this Offer Document.
32. JLLCAA, the Independent Valuer, has given and has not withdrawn its written consent to the issue
of this Offer Document with the inclusion herein of its name and all references thereto and the
Independent Valuation Report included in Appendix K to this Offer Document, in the form and
context in which they appear in this Offer Document and to act in such capacity in relation to this
Offer Document. The above report was prepared for the purpose of incorporation in this Offer
Document.
33. CRU, the Independent Market Consultant, has given and has not withdrawn its written consent to
the issue of this Offer Document with the inclusion herein of its name and all references thereto
and the CRU Industry Report included in Appendix L to this Offer Document, in the form and
context in which they appear in this Offer Document and to act in such capacity in relation to this
Offer Document. The above report was prepared for the purpose of incorporation in this Offer
Document.
34. UOB, the Sponsor and Underwriter, has given and has not withdrawn its written consent to the
issue of this Offer Document with the inclusion herein of its name and references thereto in the
form and context in which they appear in this Offer Document and to act in such capacity in relation
to this Offer Document.
205
35. Asiasons, the Placement Agent, has given and has not withdrawn its written consent to the issue
of this Offer Document with the inclusion herein of its name and references thereto in the form and
context in which it appears in this Offer Document and to act in such capacity in relation to this
Offer Document.
36. Each of the Solicitors to the Invitation, Solicitors to the Sponsor and Underwriter and the
Placement Agent, Legal Advisers to the Sponsor and Underwriter and the Placement Agent on
PRC Law, the Share Registrar and Share Transfer Agent, the Receiving Bank and the Principal
Banker does not make or purport to make any statement in this Offer Document or any statement
upon which a statement in this Offer Document is based and, to the maximum extent permitted by
law, expressly disclaims and takes no responsibility for any liability to any person which is based
on, or arises out of, the statements, information or opinions in this Offer Document.
RESPONSIBILITY STATEMENT BY OUR DIRECTORS AND VENDORS
37. The Directors and the Vendors collectively and individually accept full responsibility for the
accuracy of the information given in this Offer Document and conrm after making all reasonable
enquiries, that to the best of their knowledge and belief, this Offer Document constitutes full and
true disclosure of all material facts about the Invitation and our Group, and the Directors and
the Vendors are not aware of any facts the omission of which would make any statement in this
Offer Document misleading. Where information in this Offer Document has been extracted from
published or otherwise publicly available sources or obtained from a named source, the sole
responsibility of the Directors and the Vendors has been to ensure that such information has been
accurately and correctly extracted from those sources and/ or reproduced in this Offer Document in
its proper form and context.
DOCUMENTS AVAILABLE FOR INSPECTION
38. Copies of the following documents may be inspected at our registered ofce at 1 Robinson Road,
#17-00, AIA Tower, Singapore 048542, during normal business hours for a period of six (6) months
from the date of this Offer Document:
(a) the Memorandum and Articles of Association of our Company;
(b) the Audited Combined Financial Statements for the nancial years ended 31 December
2010, 2011 and 2012 set out in Appendix A to this Offer Document;
(c) the Unaudited Interim Condensed Combined Financial Statements for the three months
period ended 31 March 2013 set out in Appendix B to this Offer Document;
(d) the Unaudited Pro Forma Combined Financial Information for the nancial year ended 31
December 2012 and the three months period ended 31 March 2013 set out in Appendix C
to this Offer Document;
(e) the material contracts referred to in the section entitled General and Statutory Information
Material Contracts of this Offer Document;
(f) the audited nancial statements of our Company for the nancial period from 3 January 2012
(date of incorporation) to 31 December 2012 and Norwest Chemicals and its subsidiary for
the nancial years ended 31 December 2010, 2011 and 2012;
(g) the service agreements of the Directors referred to in the section entitled Management and
Corporate Governance Service Agreements of this Offer Document;
(h) the letters of consent referred to in the section entitled General and Statutory Information
Consents of this Offer Document;
206
(i) the rules of the AsiaPhos Performance Share Plan set out in Appendix F to this Offer
Document;
(j) the WGM Technical Report set out in Appendix J to this Offer Document;
(k) the Independent Valuation Report set out in Appendix K to this Offer Document
(l) the CRU Industry Report as set out in Appendix L to this Offer Document; and
(m) the opinions in relation to PRC law from King & Wood Mallesons as set out in the sections
entitled Risk Factors; Dividend Policy; General Information on our Group Mining
Operations approvals and permits; General Information on our Group Properties leased
by our Group; and General Information on our Group Legal Opinion from King & Wood
Mallesons of this Offer Document.
A-1
APPENDIX A: AUDITED COMBINED FINANCIAL STATEMENTS FOR THE
FINANCIAL YEARS ENDED 31 DECEMBER 2010, 2011 AND 2012
Independent Auditors Report on
Audited Combined Financial Statements of
AsiaPhos Limited and its Subsidiaries
For the nancial years ended 31 December 2010, 2011 and 2012
25 September 2013
The Board of Directors
AsiaPhos Limited
Dear Sirs
Report on the Financial Statements
We have audited the accompanying nancial statements of AsiaPhos Limited (formerly known as
AsiaPhos Private Limited) (the Company) and its subsidiaries (collectively, the Group), comprising
the combined balance sheets as at 31 December 2010, 2011 and 2012, its combined statements of
comprehensive income, statements of changes in equity and statements of cash ows for each of the
years ended 31 December 2010, 2011 and 2012, and a summary of signicant accounting policies and
other explanatory notes, as set out on pages A-3 to A-58.
Managements Responsibility for the Financial Statements
The Companys management is responsible for the preparation and fair presentation of these combined
nancial statements in accordance with the provisions of Singapore Financial Reporting Standards, and
for devising and maintaining a system of internal accounting controls sufcient to provide a reasonable
assurance that assets are safeguarded against loss from unauthorised use or disposition; and
transactions are properly authorised and that they are recorded as necessary to permit the preparation of
true and fair prot and loss accounts and balance sheets and to maintain accountability of assets.
Auditors Responsibility
Our responsibility is to express an opinion on these combined nancial statements based on our audit.
We conducted our audit in accordance with Singapore Standards on Auditing. Those standards require
that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance
about whether the combined nancial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in
the combined nancial statements. The procedures selected depend on the auditors judgment, including
the assessment of the risks of material misstatement of the combined nancial statements, whether due
to fraud or error. In making those risk assessments, the auditor considers internal control relevant to
the entitys preparation and fair presentation of combined nancial statements in order to design audit
procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on
the effectiveness of the entitys internal control. An audit also includes evaluating the appropriateness of
accounting policies used and the reasonableness of accounting estimates made by management, as well
as evaluating the overall presentation of the combined nancial statements.
A-2
Audited Combined Financial Statements of
We believe that the audit evidence we have obtained is sufcient and appropriate to provide a basis for
our audit opinion.
Opinion
In our opinion, the abovementioned combined nancial statements of the Group present fairly, in
all material respects, the state of affairs of the Group as at 31 December 2010, 2011 and 2012 and
its results of operations, changes in equity and cash ows for each of the nancial years ended 31
December 2010, 2011 and 2012 in accordance with Singapore Financial Reporting Standards.
Restriction on Distribution and Use
This report is made solely to you as a body and for the inclusion in the Offer Document to be issued in
relation to the proposed listing of the shares of the Company in connection with the Companys listing on
the Singapore Exchange Securities Trading Limited.
ERNST & YOUNG LLP
Singapore
A-3
Combined Statements of Comprehensive Income
Note 31 December
2010 2011 2012
$000 $000 $000
Revenue 5 2,775 4,522 4,897
Cost of sales (2,373) (2,148) (2,796)
Gross prot 402 2,374 2,101
Other income 6 981 2,535 3,538
Selling and distribution costs (426) (483) (227)
General and administrative costs (2,738) (1,484) (3,899)
Other operating income 627
Finance costs (52) (9) (4)
(Loss)/prot before tax 7 (1,206) 2,933 1,509
Taxation 8 28 (284)
(Loss)/prot for the year attributable to owners of
the Company (1,178) 2,933 1,225
Other comprehensive (loss)/income
Foreign currency translation (101) 535 (918)
Total comprehensive (loss)/income for the year
attributable to owners of the Company (1,279) 3,468 307
(Loss)/earnings per share (cents)
Basic 28 (0.17) 0.42 0.17
Adjusted 28 (0.15) 0.37 0.15
The accompanying accounting policies and explanatory notes form an integral part of the nancial
statements.
A-4
Combined Balance Sheets
As at 31 December 2010, 2011 and 2012
Note 31 December
2010 2011 2012
$000 $000 $000
Non-current assets
Mine properties 9 906 813 675
Land use rights 10 815 1,763 1,642
Property, plant and equipment 11 2,346 16,474 28,778
Prepayments 12 2,599 3,928 2,093
6,666 22,978 33,188
Current assets
Stocks 13 1,983 3,043 2,907
Trade receivables 14 183 198 137
Other receivables 15 165 380 1,750
Deferred expenses 16 308 343
Prepayments 17 291 313 492
Cash and bank balances 18 983 3,213 4,772
3,605 7,455 10,401
Total assets 10,271 30,433 43,589
Current liabilities
Trade payables 19 166 470 1,306
Other payables 20 4,548 8,036 10,172
Advances from customers 368 627 147
Amounts due to ultimate holding company 21 600 2,050 646
6,594 11,183 12,271
Net current liabilities (2,989) (3,728) (1,870)
statements.
A-5
Combined Balance Sheets (contd)
As at 31 December 2010, 2011 and 2012
Note 31 December
2010 2011 2012
$000 $000 $000
Deferred tax liabilities 23 42 42 320
Deferred income 24 2,247 2,348 2,231
Provision for rehabilitation 25 54 58 158
2,343 2,448 2,709
Total liabilities 8,937 13,631 14,980
Net assets 1,334 16,802 28,609
Share capital 26 9,048 21,048 32,548
Reserves 27 (7,714) (4,246) (3,939)
Total equity 1,334 16,802 28,609
statements.
A-6
Combined Statements of Changes in Equity
Group
Share
capital
Retained
earnings
Foreign
currency
translation
reserve
Safety
fund
surplus
reserve
Total
reserves
Total
Equity
$000 $000 $000 $000 $000 $000
1 January 2010 9,048 (8,012) 1,577 (6,435) 2,613
Loss for the year, net of tax (1,178) (1,178) (1,178)
Other comprehensive loss (101) (101) (101)
Total comprehensive loss for the year (1,178) (101) (1,279) (1,279)
At 31 December 2010 9,048 (9,190) 1,476 (7,714) 1,334
Prot for the year, net of tax 2,933 2,933 2,933
Other comprehensive income 535 535 535
Total comprehensive income for the year 2,933 535 3,468 3,468
Issue of new shares 12,000 12,000
At 31 December 2011 21,048 (6,257) 2,011 (4,246) 16,802
Prot for the year, net of tax 1,225 1,225 1,225
Other comprehensive income (918) (918) (918)
Total comprehensive income for the year 1,225 (918) 307 307
Issue of new shares 11,500 11,500
Others
Transfer to safety fund surplus reserve (46) 46
Utilisation of safety fund reserve 46 (46)
At 31 December 2012 32,548 (5,032) 1,093 (3,939) 28,609
statements.
A-7
Combined Statements of Cash Flow
31 December
2010 2011 2012
$000 $000 $000
Cash ow from operating activities
(Loss)/prot before tax (1,206) 2,933 1,509
Adjustments for:
Depreciation of property, plant and equipment 83 175 275
Amortisation of mine properties and land use rights 155 134 164
Impairment loss on property, plant and equipment written back (633)
Interest on bank loans 52 7
Interest income (25) (9) (9)
Gain on disposal of property, plant and equipment (106) (2)
Gain on relocation (1,874) (3,471)
Unwinding of discount for provision for rehabilitation 2 4
Listing expenses 1,780
Operating (loss)/prot before working capital changes (1,574) 1,262 250
Decrease/(increase) in stocks 990 (922) (16)
Decrease/(increase) in receivables 1,364 (406) (303)
Increase/(decrease) in payables 81 (143) (1,531)
Cash generated from/(used in) operations 861 (209) (1,600)
Interest received 25 9 9
Interest paid (52) (7)
Tax paid (6)
Net cash ows generated from/(used in) operating activities 828 (207) (1,591)
statements.
A-8
Combined Statements of Cash Flow (contd)
31 December
2010 2011 2012
$000 $000 $000
Cash ow from investing activities
Purchase of property, plant and equipment (a) (1,182) (10,302) (8,215)
Payment for mine properties (30)
Payments made in advance of:
- land use rights (2,312) (997) (509)
- property, plant and equipment (365) (1,828) (45)
Proceeds from disposal of property, plant and equipment 294 2
Compensation proceeds from government for relocation of factory 3,293 3,519
Incidental costs in relation to relocation (124) (479)
Net cash ows used in investing activities (3,859) (9,664) (5,757)
Cash ow from nancing activities
Repayment of bank loans (925) (905)
Proceeds from bank loans 1,361
Receipt of government grant 2,314
Amount due to ultimate holding company 300 1,450 (1,404)
Proceeds from issue of new shares 12,000 11,500
Payments incurred in relation to the initial public offering (242) (1,281)
Net cash ows generated from nancing activities 3,050 12,303 8,815
Net increase in cash and cash equivalents 19 2,432 1,467
Cash and cash equivalents at beginning of the year 839 824 3,047
Effects of exchange rate changes on cash and cash equivalents (34) (209) 99
Cash and cash equivalents at end of the year (Note 18) 824 3,047 4,613
statements.
A-9
Combined Statements of Cash Flow (contd)
Notes to the combined statements of cash ow
(a) Purchase of property, plant and equipment
31 December
2010 2011 2012
$000 $000 $000
Current year additions (Note 11) 1,753 13,677 13,669
Less: Prepayments made in prior years (2,225)
Increase in payables related to property,
plant and equipment (516) (3,375) (4,133)
Provision for rehabilitation (55) (100)
Sale of samples produced when testing equipment 1,004
Net cash outow for purchase of property, plant and
equipment 1,182 10,302 8,215
statements.
A-10
Notes to the Combined Financial Statements - 31 December 2010, 2011 and 2012
1. Corporate information
AsiaPhos Limited (the Company) was incorporated in the Republic of Singapore on 3 January
2012 as a private company limited by shares under the name of AsiaPhos Private Limited. On
6 September 2013, the Company changed its name to AsiaPhos Limited in connection with its
conversion to a public company limited by shares. The Company was incorporated for the purpose
of acquiring the subsidiaries pursuant to the Restructuring Exercise as described in Note 2 to the
combined nancial statements.
The registered ofce and the principal place of business of the Company is located at 1 Robinson
Road, #17-00, AIA Tower, Singapore 048542 and 600 North Bridge Road, Parkview Square #12-
01, Singapore 188778 respectively.
The principal activity of the Company is that of investment holding. The principal activities of the
subsidiaries are disclosed in Note 2.1.
AsiaPhos Limited and its subsidiaries (collectively, the Group) operate in Singapore and the
Peoples Republic of China (PRC).
The ultimate holding company of the Group is Eastcomm Pte Ltd (Eastcomm), a company
incorporated in Singapore.
2. The Restructuring Exercise
Prior to the Restructuring Exercise, Eastcomm holds two subsidiaries (i.e. Norwest Chemicals Pte
Ltd (Norwest Chemicals) and Sichuan Mianzhu Norwest Phosphate Chemical Company Limited
(Mianzhu Norwest)). A Restructuring Exercise was carried out which resulted in the Company
being the holding company of Norwest Chemicals and Mianzhu Norwest.
The details of the Restructuring Exercise are as follows:
(a) Incorporation of the Company
The Company was incorporated in Singapore on 3 January 2012 in accordance with the
Companies Act as a private company limited by shares with an initial paid-up share capital
of S$2.00 comprising two (2) Shares held by Eastcomm.
(b) Acquisition of the entire issued and paid-up share capital of Norwest Chemicals
The Company entered into a restructuring agreement (the Restructuring Agreement) dated
19 June 2013 with Eastcomm to acquire the entire issued and paid-up share capital of
Norwest Chemicals for an aggregate purchase consideration of S$33,544,782, based on the
unaudited net asset value of Norwest Chemicals as at 30 April 2013.
A-11
2. The Restructuring Exercise (contd)
(contd)
Pursuant to the Restructuring Agreement, the purchase consideration was satised by the
allotment and issuance of new ordinary shares in the Company (the Consideration Shares)
as follows:
(i) 16,000,000 Consideration Shares were allotted and issued to Eastcomm; and
Note 2(c) below) were allotted and issued as follows:
Note 2(d) below).
(c) Sub-Division of Shares (the Share Split)
On 16 September 2013, 16,000,002 shares in the Company were sub-divided into
64,000,008 shares.
(d) Redemption of Notes in Eastcomm held by Noteholders
In 2010, 2012 and 2013, Eastcomm had entered into investment agreements and
supplemental letters, (the Investment Agreements), with various parties (the Noteholders).
On 16 September 2013, Eastcomm redeemed the Notes issued by Eastcomm to the
Noteholders.
In lieu of payment of cash, Eastcomm directed the Company to allot and issue 163,675,863
Consideration Shares to the Noteholders. These Consideration Shares were issued by the
Company as part of the consideration for the Companys acquisition of Norwest Chemicals
from Eastcomm.
A-12
2.1 The Subsidiaries
The subsidiaries of the Company subsequent to the Restructuring Exercise are as follow:
Name of company
(Country of
registration)
Principal activity
(Place of business)
Effective ownership
held by the Group
subsequent to
the Restructuring
Exercise
Norwest Chemicals Pte Ltd
#

(Republic of Singapore)
Investing in chemical projects
general wholesale trade and
trading of chemicals
100%
Held by Norwest Chemicals
Sichuan Mianzhu Norwest
Phosphate Chemical Company
Limited *
(Peoples Republic of China)
phosphate rocks, the production
and sale of phosphorus and
phosphate based chemical
products
100%
#
Audited by Ernst & Young LLP, Singapore
* Audited by Ernst & Young Hua Ming LLP, Chengdu Branch
For the nancial years ended 31 December 2010, 2011 and 2012, Eastcomm is the immediate
and ultimate holding company of Norwest Chemicals and Mianzhu Norwest is a wholly owned
subsidiary of Norwest Chemicals.
Although the Company was incorporated on 3 January 2012 and the Restructuring Exercise was
completed on 16 September 2013, the combined nancial statements presented for the years
ended 31 December 2010, 2011 and 2012 for the purpose of inclusion in the Offer Document
are that of the Company and its subsidiaries prepared in accordance with RAP 12 Merger
Accounting for Common Control Combinations for nancial statements prepared under Part IX of
the Fifth Schedule to the Securities and Futures (Offers of Investments) (Shares and Debentures)
Regulations 2005.
The substance is that the Group is a continuation of Norwest Chemicals and Mianzhu Norwest.
The combined nancial statements of the Group for the years ended 31 December 2010, 2011 and
2012 have been presented as if the Group had been in existence for all periods presented and the
assets and liabilities are brought into the combined nancial statements at the existing carrying
amounts. The retained earnings recognised in the combined nancial statements are the retained
earnings of Norwest Chemicals and Mianzhu Norwest as at 31 December 2010 and 2011 and the
retained earnings of the Company, Norwest Chemicals and Mianzhu Norwest as at 31 December
2012.
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3. Summary of signicant accounting policies
3.1 Basis of preparation
The combined financial statements of the Group have been prepared in accordance with
Singapore Financial Reporting Standards (FRS).
The nancial statements have been prepared on a historical cost basis and are presented in
Singapore Dollar (SGD or $). All values in the tables are rounded to the nearest thousand ($000)
as indicated.
3.2 Fundamental accounting concept
As at 31 December 2012, the Groups current liabilities exceeded its current assets by
approximately $1,870,000 (2011: $3,728,000 and 2010: $2,989,000).
The directors have prepared the combined nancial statements on a going concern basis as the
directors are of the view that the Group will be able to generate net cash inows from its operating
activities for a period of 12 months from the date these nancial statements were approved.
Furthermore, subsequent to year end, the shareholder approved the capitalisation of amount due
to ultimate holding company amounting to $646,400 by way of issuance of 646,400 new ordinary
shares of $1 each in Norwest Chemicals and an additional capital injection of $1,200,000 by way of
issuance of 1,200,000 new ordinary shares of $1 each in Norwest Chemicals (Note 35).
3.3 Adoption of new accounting policies
The Group has adopted all the new and revised standards and interpretations of FRS (INT
FRS) that are effective for annual periods beginning on or after 1 January 2010, 2011 and 2012.
The adoption of these standards and interpretations did not have any effect on the nancial
performance or position of the Group.
3.4 Standards issued but not yet effective
The Group has not adopted the following standards and interpretations that have been issued but
are not yet effective:
Description
Effective for annual
periods beginning
on or after
Amendments to FRS 1 Presentation of Items of Other Comprehensive
Income 1 July 2012
Revised FRS 19 Employee Benets 1 January 2013
FRS 113 Fair Value Measurement 1 January 2013
Amendments to FRS 107 Disclosures Offsetting Financial Assets and
Financial Liabilities 1 January 2013
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3. Summary of signicant accounting policies (contd)
3.4 Standards issued but not yet effective (contd)
Description
periods beginning
on or after
Improvements to FRSs 2012 1 January 2013
- Amendment to FRS 1 Presentation of Financial Statements 1 January 2013
- Amendment to FRS 16 Property, Plant and Equipment 1 January 2013
- Amendment to FRS 32 Financial Instruments: Presentation 1 January 2013
Revised FRS 27 Separate Financial Statements 1 January 2014
Revised FRS 28 Investments in Associates and Joint Ventures 1 January 2014
FRS 110 Consolidated Financial Statements 1 January 2014
FRS 111 Joint Arrangements 1 January 2014
FRS 112 Disclosure of Interests in Other Entities 1 January 2014
Amendments to FRS 32 Offsetting Financial Assets and Financial Liabilities 1 January 2014
Amendments to FRS 110, FRS 111 and FRS 112 Transition Evidence 1 January 2014
Amendments to FRS 110, FRS 112 and FRS 27 Investment Entities 1 January 2014
Except for the Amendments to FRS 1 and FRS 112, the directors expect that the adoption of the
other standards and interpretations above will have no material impact on the nancial statements
in the period of initial application. The nature of the impending changes in accounting policy on
adoption of the Amendments to FRS 1 and FRS 112 are described below.
Amendments to FRS 1 Presentation of Items of Other Comprehensive Income
The Amendments to FRS 1 Presentation of Items of Other Comprehensive Income (OCI) is
effective for nancial periods beginning on or after 1 July 2012.
The Amendments to FRS 1 changes the grouping of items presented in OCI. Items that could
be reclassied to prot or loss at a future point in time would be presented separately from items
which will never be reclassied. As the Amendments only affect the presentations of items that
are already recognised in OCI, the Group does not expect any impact on its nancial position or
performance upon adoption of this standard.
FRS 112 Disclosure of Interests in Other Entities
FRS 112 Disclosure of Interests in Other Entities is effective for nancial periods beginning on or
after 1 January 2014.
FRS 112 is a new and comprehensive standard on disclosure requirements for all forms of
interests in other entities, including joint arrangements, associates, special purpose vehicles and
other off balance sheet vehicles. FRS 112 requires an entity to disclose information that helps
users of its nancial statements to evaluate the nature and risks associated with its interests in
other entities and the effects of those interests on its nancial statements. As this is a disclosure
standard, it will have no impact to the nancial position and nancial performance of the Group
when implemented in 2014.
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3.5 Basis of consolidation
The nancial statements of the subsidiaries used in the preparation of the nancial statements are
prepared for the same reporting date as the Company. Consistent accounting policies are applied
to like transactions and events in similar circumstances.
All intra-group balances, income and expenses and unrealised gains and losses resulting from
intra-group transactions and dividends are eliminated in full.
Subsidiaries are consolidated from the date of acquisition, being the date on which the Group
obtains control, and continue to be consolidated until the date that such control ceases.
Losses within a subsidiary are attributed to the non-controlling interest even if that results in a
decit balance.
A change in the ownership interest of a subsidiary, without a loss of control, is accounted for as an
equity transaction. Where a change in interest of a subsidiary results in the loss of control over it,
the Group:
- De-recognises the assets (including goodwill) and liabilities of the subsidiary at their carrying
amounts at the date when control is lost;
- De-recognises the carrying amount of any non-controlling interest;
- De-recognises the cumulative translation differences recorded in equity;
- Recognises the fair value of the consideration received;
- Recognises the fair value of any investment retained;
- Recognises any surplus or decit in prot or loss;
- Re-classifies the Groups share of components previously recognised in other
comprehensive income to prot or loss or retained earnings, as appropriate.
The combined nancial statements of the Group for the years ended 31 December 2010, 2011 and
2012 have been presented as if the Group had been in existence for all periods presented and the
assets and liabilities are brought into the combined nancial statements at the existing carrying
amounts. The retained earnings recognised in the combined nancial statements are the retained
earnings of Norwest Chemicals and Mianzhu Norwest as at 31 December 2010 and 2011 and the
retained earnings of Norwest Chemicals, Mianzhu Norwest and the Company as at 31 December
2012.
Under this method, the Company has been treated as the holding company of Norwest Chemicals
and its subsidiary for the nancial years presented rather than from the date of completion of the
Restructuring Exercise. Accordingly, the combined results of the Group for the respective years
include the results of the subsidiaries for the entire years under review.
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3.5 Basis of consolidation (contd)
Pursuant to this,
- Assets, liabilities, reserves, revenue and expense of Norwest Chemicals and its subsidiary
are consolidated at their existing carrying amounts;
- No amount is recognised for goodwill; and
- For the purpose of the preparation of the combined nancial statements, the share capital
as at 31 December 2010 and 2011 represented the issued and paid up share capital of
Norwest Chemicals. The issued share capital as at 31 December 2012 represented the
share capital of the Company and Norwest Chemicals.
3.6 Functional and foreign currency
Items included in the nancial statements of each entity in the Group are measured using the
currency of the primary economic environment in which the entity operates (functional currency).
The Groups combined nancial statements are presented in Singapore Dollar which is also the
Companys functional currency.
(a) Foreign currency transactions and balances
Transactions in foreign currencies are measured in the respective functional currencies of
the Company and its subsidiaries and are recorded on initial recognition in the functional
currencies at exchange rates approximating those ruling at the transaction dates. Monetary
assets and liabilities denominated in foreign currencies are translated at the closing rate of
exchange ruling at the balance sheet date. Non-monetary items that are measured in terms
of historical cost in a foreign currency are translated using the exchange rates as at the
dates of the initial transactions. Non-monetary items measured at fair value in a foreign
currency are translated using the exchange rates at the date when the fair value was
determined.
Exchange differences arising on the settlement of monetary items or on translating monetary
items at the balance sheet date are recognised in the prot or loss except for exchange
differences arising on monetary items that form part of the Groups net investment in foreign
operations, which are recognised initially in other comprehensive income and accumulated
under foreign currency translation reserve in equity. The foreign currency translation reserve
is reclassied from equity to prot or loss of the Group on disposal of the foreign operation.
(b) Foreign currency translation
The assets and liabilities of foreign operations are translated into SGD at the rate of
exchange ruling at the balance sheet date and their statement of comprehensive income
are translated at average exchange rates for the year which approximate the exchange rates
prevailing at the date of the transactions. The exchange differences arising on the translation
are recognised initially in other comprehensive income and accumulated under foreign
currency translation reserve in equity. On disposal of a foreign operation, the cumulative
amount recognised in foreign currency translation reserve relating to that particular foreign
operation is recognised in the prot or loss.
In the case of a partial disposal without loss of control of a subsidiary that includes a foreign
operation, the proportionate share of the cumulative amount of the exchange differences are
re-attributed to non-controlling interest and are not recognised in prot or loss.
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3.7 Property, plant and equipment
All items of property, plant and equipment are initially recorded at cost. Such cost includes the cost
of purchase price or construction cost, any cost that is directly attributable to bringing the asset
to the location and condition necessary for it to be capable of operating in the manner intended
by the management and the initial estimate of the rehabilitation obligation. The direct attributable
costs include costs of testing whether the asset is functioning properly, after deducting the net
proceeds from selling any items produced while bringing the asset to that location and condition.
Cost also includes replacing part of the property, plant and equipment and borrowing costs that are
directly attributable to the acquisition, construction or production of a qualifying property, plant and
equipment. The cost of an item of property, plant and equipment is recognised as an asset if, and
only if, it is probable that future economic benets associated with the item will ow to the Group
and the cost of the item can be measured reliably.
Waste removal costs are incurred in the development phase of a mine before the production phase
commences. These costs are capitalised under mining infrastructure. Waste removal costs that
are incurred during the production phase are deferred for those operations where this is the most
appropriate basis for matching the cost against the related economic benets and the effect is
material. This is generally the case where there are uctuations in waste removal costs over the
life of the mine.
Subsequent to recognition, property, plant and equipment are measured at cost less accumulated
depreciation and accumulated impairment losses. When signicant parts of property, plant and
equipment are required to be replaced in intervals, the Group recognises such parts as individual
assets with specic useful lives and depreciation, respectively. Likewise, when a major inspection
is performed, its cost is recognised in the carrying amount of the property, plant and equipment as
a replacement if the recognition criteria are satised. All other repair and maintenance costs are
recognised in the prot or loss as incurred.
Depreciation of plant and machinery and waste removal costs is calculated to write off the costs
over their estimated useful life using the unit-of-production method.
Depreciation of property, plant and equipment, other than plant and machinery and waste removal
cost under mining infrastructure, begins when it is available for use and is computed on a straight-
line basis over the estimated useful life of the asset as follows:
Leasehold buildings - 5%
Motor vehicles, ofce equipment, mining infrastructure and leasehold improvements - 20%
Construction-in-progress included in property, plant and equipment are not depreciated as these
assets are not yet available for use.
The carrying values of property, plant and equipment are reviewed for impairment when events or
changes in circumstances indicate that the carrying value may not be recoverable.
The residual values, useful lives and depreciation methods are reviewed at each nancial year-end,
and adjusted prospectively, if appropriate.
An item of property, plant and equipment is derecognised upon disposal or when no future
economic benets are expected from its use or disposal. Any gain or loss on derecognition of the
asset is included in the prot or loss in the year the asset is derecognised.
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3.8 Exploration and evaluation expenditure
Pre-licence costs
Expenditure incurred prior to the obtainment of the exploration right is expensed in the period in
which they are incurred.
Successful efforts method
Once the legal right to explore has been acquired, costs that lead directly to the discovery,
acquisition or development of specic, discrete mineral reserves are capitalised and become
part of the capitalised costs of each individual exploration right. These costs include the cost of
acquiring exploration rights, topographical and geological surveys, exploratory drilling, sampling
and trenching and activities in relation to commercial and technical feasibility studies, and deferred
amortisation and depreciation charges in respect of assets consumed during the exploration
activities. Costs that fail to meet the criterion are charged to prot or loss as incurred.
When technical feasibility and commercial viability of extracting mineral resources are
demonstrable, exploration and evaluation assets are tested for impairment and transferred to mine
properties under the category of Mines under construction. No amortisation is charged during the
exploration and evaluation phase.
Impairment of exploration and evaluation assets
Exploration and evaluation assets are assessed for impairment, when fact and circumstances
indicate that the carrying amount of an exploration and evaluation assets may exceed its
recoverable amount. An impairment test is performed if any of the following indicators is present:
(a) The period for which the entity has the right to explore in the specic area has expired
during the period or will expire in the near future, and is not expected to be renewed;
(b) Substantive expenditure on further exploration for and evaluation of mineral resources in the
specic area is neither budgeted nor planned;
(c) Exploration for and evaluation of mineral resources in the specic area have not led to the
discovery of commercially viable quantities of mineral resources and the entity has decided
to discontinue such activities in the specic area; or
(d) Sufcient data exist to indicate that, although a development in the specic area is likely
to proceed, the carrying amount of the exploration and evaluation asset is unlikely to be
recovered in full from successful development or through sale.
An impairment loss is recognised for the amount by which the exploration and evaluation assets
carrying amount exceeds their recoverable amount. The recoverable amount is the higher
of the exploration and evaluation assets fair value less costs to sell and their value in use. For
the purposes of assessing impairment, the exploration and evaluation assets subject to testing
are grouped with existing cash-generating units of production elds that are located in the same
geographical region.
As at 31 December 2010, 2011 and 2012, there are no exploration and evaluation assets.
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3.9 Mine properties
Mine properties comprise of Mines under construction and Producing mines. Mine properties
which are acquired separately, are measured initially at cost. The cost of mine properties acquired
in a business combination is their fair value as at the date of acquisition. Mine properties are
written off to prot or loss if the mine is abandoned.
Mines under construction
Upon transfer of Exploration and evaluation assets into Mines under construction, all subsequent
expenditure on the construction of the mine, installation or completion of infrastructure facilities are
capitalised within Mines under construction. Development expenditure is net of proceeds from the
incidental sale of rocks extracted during the development phase. After production starts, all assets
included in Mines under construction are transferred to Producing mines.
Mines under construction are not depreciated until construction is completed.
As at 31 December 2010, 2011 and 2012, there are no mines under construction. All have been
transferred to Producing mines.
Producing mines
Upon completion of mine construction, the assets are transferred into Producing mines.
Producing mines are stated at cost, less accumulated amortisation and accumulated impairment
losses.
When a mine construction project moves into the production stage, the capitalisation of certain
mine construction costs ceases and costs are either regarded as part of the cost of inventory or
expensed, except for costs which qualify for capitalisation relating to mining asset additions or
improvements, underground mine development or mineable reserve development.
Producing mines are amortised over the unexpired period of the mining rights of 4 to 8 years on a
straight-line basis.
3.10 Land use rights
Land use rights are initially measured at cost. Following initial recognition, land use rights are
measured at cost less accumulated amortisation and accumulated impairment losses. The land
use rights are amortised over the Groups licensed tenure of 50 years.
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3.11 Impairment of non-nancial assets
The Group assesses at each reporting date whether there is an indication that an asset may be
impaired. If any such indication exists, or when annual impairment assessment for an asset is
required, the Group makes an estimate of the assets recoverable amount.
An assets recoverable amount is the higher of an assets or cash-generating units fair value less
costs to sell and its value in use and is determined for an individual asset, unless the asset does
not generate cash inows that are largely independent of those from other assets or group of
assets. Where the carrying amount of an asset or cash-generating unit exceeds its recoverable
amount, the asset is considered impaired and is written down to its recoverable amount. In
assessing value in use, the estimated future cash ows expected to be generated by the asset
are discounted to their present value using a pre-tax discount rate that reects current market
assessments of the time value of money and the risks specic to the asset. In determining fair
value less costs to sell, recent market transactions, if available, are taken into account. If no such
transactions can be identied, an appropriate valuation model is used. These calculations are
corroborated by valuation multiples or other available fair value indicators.
The Group bases its impairment calculation on detailed budgets and forecast calculations which
are prepared separately for each of the Groups cash-generating units to which the individual
assets are allocated. These budgets and forecast calculations generally cover a period of ve
years. For longer periods, a long-term growth rate is calculated and applied to project future cash
ows after the fth year.
Impairment losses are recognised in other operating costs in the combined statement of
comprehensive income.
For assets, an assessment is made at each reporting date as to whether there is any indication
that previously recognised impairment losses may no longer exist or may have decreased. If such
indication exists, the Group estimates the assets or cash-generating units recoverable amount. A
previously recognised impairment loss is reversed only if there has been a change in the estimates
used to determine the assets recoverable amount since the last impairment loss was recognised.
If that is the case, the carrying amount of the asset is increased to its recoverable amount. The
increase cannot exceed the carrying amount that would have been determined, net of depreciation,
had no impairment loss been recognised previously. Such reversal is recognised in prot or loss.
After such a reversal, the depreciation charge for the asset shall be adjusted in future periods to
allocate the assets revised carrying amount, less its residual value (if any), on a systematic basis
over its remaining useful life.
3.12 Subsidiaries
A subsidiary is an entity over which the Group has the power to govern the nancial and operating
policies so as to obtain benets from its activities. The Company generally has such power when
it, directly or indirectly, holds more than 50% of the issued share capital, or controls more than half
of the voting power, or controls the composition of the Board of Directors.
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3.13 Financial assets
Initial recognition and measurement
Financial assets are recognised on the balance sheet when, and only when, the Group becomes
a party to the contractual provisions of the nancial instrument. The Group determines the
classication of its nancial assets at initial recognition.
When nancial assets are recognised initially, they are measured at fair value, plus, in the case of
nancial assets not at fair value through prot or loss, directly attributable transaction costs.
Subsequent measurement for loans and receivables
Non-derivative nancial assets with xed or determinable payments that are not quoted in an
active market are classied as loans and receivables. Subsequent to initial recognition, loans and
receivables are measured at amortised cost using the effective interest method, less impairment.
Gains and losses are recognised in the prot or loss when the loans and receivables are
derecognised or impaired, as well as through the amortisation process.
Derecognition
A nancial asset is derecognised where the contractual right to receive cash ows from the asset
has expired. On derecognition of a nancial asset in its entirety, the difference between the
carrying amount and the sum of the consideration received and any cumulative gain or loss that
had been recognised in other comprehensive income is recognised in prot or loss.
All regular way purchases and sales of nancial assets are recognised or derecognised on the
trade date i.e., the date that the Group commits to purchase or sell the asset. Regular way
purchases or sales are purchases or sales of nancial assets that require delivery of assets within
the period generally established by regulation or convention in the marketplace concerned.
3.14 Impairment of nancial assets
The Group assesses at each balance sheet date whether there is any objective evidence that a
nancial asset is impaired.
Financial assets carried at amortised cost
For nancial assets carried at amortised cost, the Group rst assesses whether objective evidence
of impairment exists individually for nancial assets that are individually signicant, or collectively
for nancial assets that are not individually signicant. If the Group determines that no objective
evidence of impairment exists for an individually assessed nancial asset, whether signicant or
not, it includes the asset in a group of nancial assets with similar credit risk characteristics and
collectively assesses them for impairment. Assets that are individually assessed for impairment
and for which an impairment loss is, or continues to be recognised are not included in a collective
assessment of impairment.
If there is objective evidence that an impairment loss on nancial assets carried at amortised cost
has incurred, the amount of the loss is measured as the difference between the assets carrying
amount and the present value of estimated future cash ows discounted at the nancial assets
original effective interest rate. If a loan has a variable interest rate, the discount rate for measuring
any impairment loss is the current effective interest rate. The carrying amount of the asset is
reduced through the use of an allowance account. The impairment loss is recognised in the prot
or loss.
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3.14 Impairment of nancial assets (contd)
Financial assets carried at amortised cost (contd)
When the asset becomes uncollectible, the carrying amount of impaired nancial assets is reduced
directly or if an amount was charged to the allowance account, the amounts charged to the
allowance account are written off against the carrying value of the nancial asset.
To determine whether there is objective evidence that an impairment loss on nancial assets has
been incurred, the Group considers factors such as the probability of insolvency or signicant
nancial difculties of the debtor and default or signicant delay in payments.
If, in a subsequent period, the amount of the impairment loss decreases and the decrease can
be related objectively to an event occurring after the impairment was recognised, the previously
recognised impairment loss is reversed to the extent that the carrying amount of the asset does not
exceed its amortised cost at the reversal date. The amount of reversal is recognised in the prot or
loss.
3.15 Cash and cash equivalents
Cash and cash equivalents comprise cash on hand, cash at bank and xed deposits which are
subjected to an insignicant risk of changes in value. Cash and cash equivalents exclude pledged
deposits held for mine activities.
3.16 Stocks
Stocks are stated at the lower of cost and net realisable value. Costs incurred in bringing the
stocks to their present location and condition are accounted for as follows:-
- Raw materials: purchase costs and other directly attributable costs, on a weighted average
basis.
- Finished goods: costs include direct material, mining processing, direct labour and an
appropriate proportionate of variable and xed overhead costs. These costs are assigned on
a weighted average basis.
Where necessary, allowance is provided for damaged, obsolete and slow moving items to adjust
the carrying value of stocks to the lower of cost and net realisable value.
Net realisable value is the estimated selling price in the ordinary course of business, less estimated
costs of completion and the estimated costs necessary to make the sale.
3.17 Provisions
Provisions are recognised when the Group has a present obligation (legal or constructive) as a
result of a past event, it is probable that an outow of resources embodying economic benets will
be required to settle the obligation and the amount of the obligation can be estimated reliably.
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3.17 Provisions (contd)
Provisions are reviewed at each balance sheet date and adjusted to reect the current best
estimate. If it is no longer probable that an outow of economic resources will be required to
settle the obligation, the provision is reversed. If the effect of the time value of money is material,
provisions are discounted using a current pre tax rate that reects, where appropriate, the risks
specic to the liability. When discounting is used, the increase in the provision due to the passage
of time is recognised as a nance cost.
The Group records the present value of estimated costs of legal and constructive obligations
required to restore mining location in the period in which the obligation is incurred. The nature of
these restoration activities includes dismantling and removing structures, rehabilitating mines and
dismantling operating facilities, closure of plant and waste sites, and restoration, reclamation and
re-vegetation of affected areas.
The obligation generally arises when the asset is installed or the ground environment is disturbed
at the mining location. The Group estimates its liabilities for nal rehabilitation and mine closure
based on calculations of the amount and timing of the future cash expenditure to perform the
required work. Spending estimates are escalated for ination, then discounted at a discount rate
that reects current market assessments of the time value of money and the risks specic to the
liability such that the amount of provision reects the present value of the expenditures expected
to be required to settle the obligation. When the liability is initially recognised, the present value
of the estimated cost is capitalised by increasing the carrying amount of the related mining
infrastructure. Over time, the discounted liability is increased for the change in present value based
on the appropriate discount rate. The periodic unwinding of the discount is recognised within
nance costs in the prot or loss. The asset is depreciated using the straight line method over its
expected life and the liability is accreted to the projected expenditure date.
Additional disturbances or changes in estimates (such as mine plan revisions, changes in
estimated costs, or changes in timing of the performance of reclamation activities) will be
recognised as additions or charges to the corresponding assets and rehabilitation liabilities when
they occur at the appropriate discount rate. Any reduction in the rehabilitation liability and therefore
any deduction from the asset to which it relates, may not exceed the carrying value of that asset. If
it does, any excess over the carrying value is taken immediately to prot and loss.
3.18 Government grants
Government grants are recognised at their fair value when there is reasonable assurance that the
grant will be received and all attached conditions will be complied with. Where the grant relates
to an asset, the fair value is recognised as deferred income grant on the balance sheet and is
amortised in the prot or loss on a systematic and rational basis over the useful life of the relevant
asset. When the grant relates to income, it is recognised in the prot or loss on a systematic basis
over the periods in which the entity recognises the related costs as expenses for which the grant is
intended to compensate. Grants related to income are deducted in reporting the related expenses
in prot or loss.
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3.19 Financial liabilities
Initial recognition and measurement
Financial liabilities are recognised on the balance sheet when, and only when, the Group becomes
a party to the contractual provisions of the nancial instrument. The Group determines the
classication of its nancial liabilities at initial recognition.
All nancial liabilities are recognised initially at fair value and in the case of other nancial liabilities,
plus directly attributable transaction costs.
Subsequent measurement
After initial recognition, nancial liabilities, other than the nancial liabilities measured at fair value
through prot or loss, are subsequently measured at amortised cost using the effective interest
method. Gains and losses are recognised in prot or loss when the liabilities are derecognised,
and through the amortisation process.
Derecognition
A nancial liability is derecognised when the obligation under the liability is discharged or cancelled
or expires. When an existing nancial liability is replaced by another from the same lender on
substantially different terms, or the terms of an existing liability are substantially modied, such an
exchange or modication is treated as a derecognition of the original liability and the recognition of
a new liability, and the difference in the respective carrying amounts is recognised in the prot or
loss.
3.20 Borrowing costs
Borrowing costs are capitalised as part of the cost of a qualifying asset if they are directly
attributable to the acquisition, construction or production of that asset. Capitalisation of borrowing
costs commences when the activities to prepare the asset for its intended use or sale are in
progress and the expenditures and borrowing costs are incurred. Borrowing costs are capitalised
until the assets are substantially completed for their intended use or sale. All other borrowing costs
are expensed in the period they occur. Borrowing costs consist of interest and other costs that an
entity incurs in connection with the borrowing of funds.
3.21 Employee benets
Dened contribution plan
The Group participates in the national pension schemes as dened by the laws of the countries in
which it has operations. In particular, the Singapore companies in the Group make contributions
to the Central Provident Fund scheme in Singapore, a dened contribution pension scheme.
Contributions to dened contribution pension schemes are recognised as an expense in the period
in which the related service is performed.
The employees of the subsidiary in Peoples Republic of China are required to participate in a
dened contribution retirement scheme. The subsidiary is required to make contributions to a local
social security bureau and housing fund management bureau at a rate of 20% and 5% respectively
of the employees salaries, and charge to the prot or loss as incurred. The Group has no further
obligations for payment of pension benets beyond the annual contributions to the local social
security bureau.
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3.21 Employee benets (contd)
Employee leave entitlement
Employee entitlements to annual leave are recognised as a liability when they accrue to the
employees. The estimated liability for leave is recognised for services rendered by employees up
to the balance sheet date.
3.22 Leases
The determination of whether an arrangement is, or contains a lease is based on the substance of
the arrangement at inception date: whether fullment of the arrangement is dependent on the use
of a specic asset or assets or the arrangement conveys a right to use the asset, even if that right
is not explicitly specied in an arrangement.
As lessee
Operating lease payments are recognised as an expense in the prot or loss on a straight-line
basis over the lease term. The aggregate benet of incentives provided by the lessor is recognised
as a reduction of rental expense over the lease term on a straight-line basis.
3.23 Revenue recognition
Revenue is recognised to the extent that it is probable that the economic benets will ow to
the Group and the revenue can be reliably measured regardless of when the payment is made.
Revenue is measured at the fair value of consideration received or receivable, taking into account
contractually dened terms of payment, excluding discounts, rebates, and sales taxes or duty. The
Group assesses its revenue arrangements to determine if it is acting as principal or agent. The
Group has concluded that it is acting as a principal in all of its revenue arrangements.
(i) Sale of goods
Revenue from sale of goods is recognised upon the transfer of signicant risks and rewards
of ownership of the goods to the customer, which generally coincides with delivery and
acceptance of the goods sold. Revenue is not recognised to the extent where there are
signicant uncertainties regarding recovery of the consideration due, associated costs or the
possible return of goods.
(ii) Interest income
Interest income is recognised using the effective interest method.
A-26
3.24 Taxes
(a) Current income tax
Current income tax assets and liabilities for the current and prior periods are measured
at the amount expected to be recovered from or paid to the taxation authorities. The tax
rates and tax laws used to compute the amount are those that are enacted or substantively
enacted by the balance sheet date, in the countries where the Group operates and
generates taxable income.
Current income taxes are recognised in the prot or loss except to the extent that the tax
relates to items recognised outside the prot or loss, either in other comprehensive income
or directly in equity. Management periodically evaluates positions taken in the tax returns
with respect to situations in which applicable tax regulations are subject to interpretation and
establishes provisions where appropriate.
(b) Deferred tax
Deferred tax is provided using the liability method on temporary differences at the balance
sheet date between the tax bases of assets and liabilities and their carrying amounts for
nancial reporting purposes.
Deferred tax liabilities are recognised for all temporary differences, except:
- where the deferred income tax liability arises from the initial recognition of goodwill or
of an asset or liability in a transaction that is not a business combination and, at the
time of the transaction, affects neither the accounting prot nor taxable prot or loss;
and
- in respect of taxable temporary differences associated with investments in
subsidiaries, where the timing of the reversal of the temporary differences can be
controlled and it is probable that the temporary differences will not reverse in the
foreseeable future.
Deferred tax assets are recognised for all deductible temporary differences, carry forward of
unused tax credits and unused tax losses, to the extent that it is probable that taxable prot
will be available against which the deductible temporary differences, and the carry forward of
unused tax credits and unused tax losses can be utilised except:
- where the deferred tax asset relating to the deductible temporary difference arises
from the initial recognition of an asset or liability in a transaction that is not a business
combination and, at the time of the transaction, affects neither the accounting prot
nor taxable prot or loss; and
- in respect of deductible temporary differences associated with investments in
subsidiaries, deferred tax assets are recognised only to the extent that it is probable
that the temporary differences will reverse in the foreseeable future and taxable prot
will be available against which the temporary differences can be utilised.
A-27
3.24 Taxes (contd)
(b) Deferred tax (contd)
The carrying amount of deferred tax assets is reviewed at each balance sheet date and
reduced to the extent that it is no longer probable that sufcient taxable prot will be
available to allow all or part of the deferred tax asset to be utilised. Unrecognised deferred
tax assets are reassessed at each balance sheet date and are recognised to the extent
that it has become probable that future taxable prot will allow the deferred tax asset to be
utilised.
Deferred tax assets and liabilities are measured at the tax rates that are expected to apply
in the year when the asset is realised or the liability is settled, based on tax rates (and tax
laws) that have been enacted or substantively enacted at the balance sheet date.
Deferred tax relating to items recognised outside prot or loss is recognised outside prot or
loss. Deferred tax items are recognised in correlation to the underlying transaction either in
other comprehensive income or directly in equity and deferred tax arising from a business
combination is adjusted against goodwill on acquisition.
Deferred tax assets and deferred tax liabilities are offset, if a legally enforceable right exists
to set off current tax assets against current income tax liabilities and the deferred taxes
relate to the same taxable entity and the same taxation authority.
(c) Sales tax
Revenues, expenses and assets are recognised net of the amount of sales tax except:
Where the sales tax incurred on a purchase of assets or services is not recoverable
from the taxation authority, in which case the sales tax is recognised as part of the
cost of acquisition of the asset or as part of the expense item as applicable; and
Receivables and payables that are stated with the amount of sales tax included.
The net amount of sales tax recoverable from, or payable to, the taxation authority is
included as part of receivables or payables in the balance sheet.
3.25 Segment reporting
For management purposes, the Group is organised into operating segments based on their
products. The management of the Group regularly reviews the segment results in order to allocate
resources to the segments and to assess the segment performance. Additional disclosures on
each of these segments are shown in Note 29, including the factors used to identify the reportable
segments and the measurement basis of segment information.
A-28
3.26 Contingencies
A contingent liability is:
(a) a possible obligation that arises from past events and whose existence will be conrmed
only by the occurrence or non-occurrence of uncertain future event(s) not wholly within the
control of the Group; or
(b) a present obligation that arises from past events but is not recognised because:
(i) it is not probable that an outow of resources embodying economic benets will be
required to settle the obligation; or
(ii) the amount of obligation cannot be measured with sufcient reliability.
A contingent asset is a possible asset that arises from past events and whose existence will be
conrmed only by the occurrence or non-occurrence of one or more uncertain future events not
wholly within the control of the Group.
3.27 Related parties
A related party is dened as follows:
(a) A person or a close member of that persons family is related to the Group and Company if
that person:
(i) Has control or joint control over the Company;
(ii) Has signicant inuence over the Company; or
(iii) Is a member of the key management personnel of the Group or Company or of a
parent of the Company.
(b) An entity is related to the Group and the Company if any of the following conditions applies:
(i) The entity and the Company are members of the same group (which means that each
parent, subsidiary and fellow subsidiary is related to others);
(ii) One entity is an associate or joint venture of the other entity (or an associate or joint
venture of a member of a group of which the other entity is a member);
(iii) Both entities are joint ventures of the same third party;
(iv) One entity is a joint venture of a third entity and the other entity is an associate of the
third entity;
(v) The entity is a post employment benet plan for the benet of employees of either the
Company or an entity related to the Company. If the Company is itself such a plan, the
sponsoring employers are also related to the Company;
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3.27 Related parties (contd)
(vi) The entity is controlled or jointly controlled by a person identied in (a); or
(vii) A person identied in (a)(i) has signicant inuence over the entity or is a member of
the key management personnel of the entity (or of a parent of the entity).
3.28 Share capital and share issuance expenses
Proceeds from issuance of ordinary shares are recognised as share capital in equity. Incremental
costs directly attributable to the issuance of ordinary shares are deducted against share capital.
4. Signicant accounting estimates and judgements
The preparation of the Groups nancial statements requires management to make judgements,
estimates and assumptions that affect the reported amounts of revenue, expenses, assets
and liabilities, and the disclosure of contingent liabilities at the balance sheet date. However,
uncertainty about these assumptions and estimates could result in outcomes that could require a
material adjustment to the carrying amount of the asset or liability affected in the future periods.
4.1 Judgements made in applying accounting policies
In the process of applying the Groups accounting policies, management has made the following
judgements, apart from those involving estimations, which has the most signicant effect on the
amounts recognised in the nancial statements:
Determination of functional currency
The Group measures foreign currency transactions in the respective functional currencies of the
Company and its subsidiaries. In determining the functional currencies of the entities in the Group,
management has to use its judgement to determine the functional currency that most faithfully
represents the economic effects of the underlying transactions, events and conditions.
Labour and materials are sourced in the PRC and together with other selling costs, they are
denominated and settled in RMB. Management has assessed Mianzhu Norwests process of
determining sales prices and concluded that RMB is the currency that mainly inuences sales
prices for its products. On this basis, management has used its judgement and determined RMB
to be Mianzhu Norwests functional currency which most faithfully represents the economic effects
of the underlying transactions, events and conditions.
4.2 Key sources of estimation uncertainty
The key assumptions concerning the future and other key sources of estimation uncertainty at the
balance sheet date, that have a signicant risk of causing a material adjustment to the carrying
amounts of assets and liabilities within the next nancial year are discussed below.
(a) Income taxes
The Group recognises liabilities for expected tax issues based on estimates of whether
additional taxes will be due. Where the nal tax outcome of these matters is different from
the amounts that were initially recognised, such differences will impact the income tax and
deferred tax provisions in the period in which such determination is made. The carrying
amount of the Groups deferred tax liabilities at 31 December 2010, 2011 and 2012 was
$42,000, $42,000 and $320,000 respectively.
A-30
4. Signicant accounting estimates and judgements (contd)
4.2 Key sources of estimation uncertainty (contd)
(b) Provision for rehabilitation
Provision for rehabilitation is based on estimates of future expenditures expected to be
incurred by the Group to undertake rehabilitation and restoration work which are discounted
at a rate reecting the term and nature of the obligations (3.64% as of 31 December 2010
and 2011 and 3.36% as of 31 December 2012) to present values. Signicant estimates and
assumptions are made in determining the provision for rehabilitation as there are numerous
factors that will affect the ultimate liability payable. These factors include estimates of the
extent and costs of rehabilitation activities, technological changes, regulatory changes,
cost increases and changes in discount rate. Those uncertainties may result in future
actual expenditure differing from the amounts currently provided. The provision at the end
of the reporting period represents managements best estimate of the present value of the
future rehabilitation costs required. For the nancial years ended 31 December 2010, 2011
and 2012, the carrying amounts of provision for rehabilitation were $54,000, $58,000 and
$158,000.
5. Revenue
Revenue represents invoiced trading sales and is shown net of allowances.
6. Other income
31 December
2010 2011 2012
$000 $000 $000
Interest income 25 9 9
Subsidy income
(1)
74 4 44
Insurance claims
(2)
420
Reversal of accrued expenses
(3)
300 421
Sale of scrap 161 113
Gain on relocation
(4)
1,874 3,471
Gain on disposal of property, plant and equipment 106 2
Others 1 8 12
981 2,535 3,538

(1)
There are no unfullled conditions or contingencies attached to these subsidies.
(2)
Insurance claims relate to claims made and received by the PRC subsidiary for the damages suffered during the
earthquake.
(3)
These accrued expenses were reversed as such accruals are no longer required.
(4)
On 29 April 2011, a subsidiary entered into an agreement with the Municipal Government of Hanwang Town
of Mianzhu, Sichuan, pursuant to which the subsidiary agreed to relocate its existing factory to Gongxing Town of
Mianzhu, Sichuan and surrender the land use rights where the old factory was erected (the Land Use Rights) to the
Municipal Government of Hanwang Town for a total compensation of RMB35,000,000 (approximately $6,800,000). In
2011, after the receipt of RMB17,000,000 (approximately $3,293,000) from the Municipal Government of Hanwang
Town, the subsidiary surrendered the Land Use Rights with net book value of $801,000 and incurred incidental costs
of $618,000 in relation to the relocation. In 2012, the subsidiary received an additional amount of RMB17,800,000
(approximately $3,519,000) and incurred incidental relocation costs of RMB243,000 (approximately $48,000).
A-31
7. (Loss)/prot before tax
The following items have been (charged)/credited in arriving at (loss)/prot before tax:
31 December
2010 2011 2012
$000 $000 $000
Amortisation of mine properties (132) (127) (130)
Amortisation of land use rights (23) (7) (34)
Depreciation of property, plant and equipment (83) (175) (275)
Exchange gain/(loss) * 21 (24) (178)
Staff costs (304) (525) (854)
Dened contribution plan (143) (124) (99)
Directors fees * (103) (100) (83)
Directors remuneration * (201) (192) (254)
Allowance written-back for stocks obsolescence 10 42
Allowance written-back/(made) for doubtful receivables
- trade 10 (10) (11)
- non-trade (4) 34
Impairment loss on property, plant and equipment
written back 633
Survey and valuation fees * (351)
Reversal of bad debts previously written off 342
Finance costs
Interest on bank loans (52) (7)
Unwinding of discount for provision for rehabilitation (2) (4)
Listing expenses * (1,780)
* Included in General and administrative costs in the combined statement of comprehensive income.
8. Taxation
The major components of income tax expense for the nancial years ended are:
31 December
2010 2011 2012
$000 $000 $000
Deferred taxation (Note 23)
- origination and reversal of temporary differences (28) 1,720
- benets of previously unrecognised tax losses (1,436)
(28) 284
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8. Taxation (contd)
A reconciliation between the corporate tax rate of the Company to the average effective tax rate of
the Group for the years ended 31 December 2010, 2011 and 2012 is as follows:
31 December
2010 2011 2012
% % %
Domestic statutory tax rates (17.00) 17.00 17.00
Adjustments on tax effect of:
Non-deductible expenses 0.75 1.24 21.52
Income not subject to taxation (9.34) (14.19) (1.63)
Benets from previously unrecognised tax losses (0.77) (23.13)
Deferred tax assets not recognised 18.78 1.56 7.48
Differences in tax rates 4.49 (4.84) (2.42)
Effective tax rate (2.32) 18.82
No provision for income tax has been made by the Group for the years ended 31 December 2010,
2011 and 2012 as the Group did not have any assessable prots subjected to tax during the
respective years.
Pursuant to the relevant tax rules and regulations of the PRC applicable to foreign investment
enterprise (FIE), a FIE is entitled to a tax holiday whereby it is exempted from PRC income tax for
its rst two prot making years (after deducting losses incurred in prior years) and is entitled to a
50% tax reduction for the subsequent three years.
On 16 March 2007, the National Peoples Congress approved the PRC Corporate Income Tax
(CIT) Law (the New CIT Law), which became effective on 1 January 2008. The New CIT Law
introduces a wide range of changes which include, but are not limited to, the unication of the
income tax rates for domestic-invested and foreign-invested enterprises at 25%. In accordance
with the New CIT Law, where enterprises were entitled to preferential treatments in the form of tax
holiday, they can continue to enjoy the tax holiday until the tax holiday benets expire, but where
they have yet to start enjoying the tax holiday due to accumulated losses, the period of tax holiday
shall be deemed to have begun effective from 1 January 2008. Accordingly, the PRC subsidiary
was entitled to exemption from PRC CIT in 2008 and 2009 and was entitled to a 50% tax reduction
for the subsequent three years (2010 to 2012). It will be subject to CIT rate of 25% thereafter. The
PRC subsidiary had accumulated tax losses and did not have to pay income taxes for the nancial
years ended 31 December 2010, 2011 and 2012.
A-33
9. Mine properties
Producing
mines
$000
Cost
At 1 January 2010 2,424
Currency realignment (129)
At 31 December 2010 and 1 January 2011 2,295
Currency realignment 103
Additions 30
At 31 December 2012 2,308
Accumulated amortisation
At 1 January 2010 1,332
Charge for the year 132
Currency realignment 69
At 31 December 2012 1,633
Net carrying amount
At 31 December 2010 906
A-34
10. Land use rights
31 December
2010 2011 2012
$000 $000 $000
Cost
At 1 January 1,196 1,132 1,763
Currency realignment (64) 80 (88)
Additions 1,674
Disposal (1,123)
At the end of the year 1,132 1,763 1,675
At 1 January 311 317
Currency realignment (17) (2) (1)
Amortisation for the year 23 7 34
Disposal (322)
At the end of the year 317 33
Net carrying amount 815 1,763 1,642
Amount to be amortised:
Not later than one year 23 35 34
Later than one year but not more than ve years 91 141 137
Later than ve years 701 1,587 1,471
815 1,763 1,642
Remaining useful lives 36 50 49
Land use rights represent cost of land use rights in respect of leasehold land located in Sichuan,
PRC.
As disclosed in Note 6, land use rights in Hanwang Town of Mianzhu, Sichuan, PRC, were
surrendered in 2011 pursuant to an agreement signed on 29 April 2011 with the local government.
The land use rights where the existing factory was erected had a net book value of approximately
$801,000, when surrendered, and had tenure of 50 years when granted in 1996.
The PRC subsidiary has obtained a land use right in Gongxing Town, Mianzhu, Sichuan, PRC in
December 2011, with tenure of approximately 50 years.
Amortisation of land use rights are recognised in the General and administrative costs in the
Statement of Comprehensive Income.
A-35
11. Property, plant and equipment
Group
Leasehold
buildings
Leasehold
improve-
ments
Plant and
machinery
Motor
vehicles
and ofce
equipment
Mining
infrastructure
Construction-
in-progress Total
$000 $000 $000 $000 $000 $000 $000
Cost
At 1 January 2010 7,615 137 8,398 821 72 17,043
Currency realignment (431) (7) (565) (44) (1) (20) (1,068)
Additions 843 245 26 55 584 1,753
At 31 December 2010
and 1 January 2011 8,027 130 8,078 803 54 636 17,728
Currency realignment 2 6 306 40 2 674 1,030
Additions 202 493 365 12,617 13,677
Transfers 219 96 (315)
Disposals (7,189) (3,434) (305) (172) (11,100)
At 31 December 2011
and 1 January 2012 1,261 136 5,539 903 56 13,440 21,335
Currency realignment (68) (7) (405) (46) (13) (902) (1,441)
Additions 223 261 77 492 12,616 13,669
Transfers 9 1,080 (1,089)
Disposals (21) (21)
At 31 December 2012 1,425 129 6,475 913 535 24,065 33,542
Accumulated
depreciation and
impairment
At 1 January 2010 7,615 137 8,398 689 72 16,911
Currency realignment (406) (7) (524) (38) (4) (979)
Charge for the year 15 7 61 83
Impairment loss written
back for the year (633) (633)
At 31 December 2010
and 1 January 2011 7,224 130 7,248 712 68 15,382
Currency realignment (52) 6 241 21 1 (1) 216
Charge for the year 44 28 93 10 175
Disposals (7,147) (3,393) (305) (67) (10,912)
At 31 December 2011
and 1 January 2012 69 136 4,124 521 11 4,861
Currency realignment (5) (7) (309) (28) (2) (351)
Charge for the year 74 40 102 59 275
Disposals (21) (21)
At 31 December 2012 138 129 3,855 574 68 4,764
Net carrying amount
At 31 December 2010 803 830 91 54 568 2,346
At 31 December 2011 1,192 1,415 382 45 13,440 16,474
At 31 December 2012 1,287 2,620 339 467 24,065 28,778
A-36
11. Property, plant and equipment (contd)
Impairment of assets
During the year ended 31 December 2010, after considering the general rising trend in metal
prices, the directors of the Group reassessed the recoverable amount of certain plant and
machinery that were previously impaired with reference to the fair values less costs to sell based
on publicly available information on metal prices. As a result, an amount of impairment loss
previously recognised $633,000 was written back for the year ended 31 December 2010.
The impairment written back of $633,000 in FY2010 was recognised in Other operating income in
the combined statement of comprehensive income.
12. Prepayments
Payments made in respect of:
31 December
2010 2011 2012
$000 $000 $000
Land use rights 2,245 1,632 2,049
Property, plant and equipment 354 2,296 44
2,599 3,928 2,093
Prepayments for land use rights as at 31 December 2010, 2011 and 2012 relate to 2, 1 and 2
leasehold lands respectively in Mianzhu, Sichuan, PRC.
During the nancial year ended 31 December 2011, the Group obtained the land use right
certicate for 1 of the leasehold land in Mianzhu, Sichuan, PRC. Accordingly, the prepayments
relating to this leasehold land has been reclassied to land use rights as disclosed in Note 10 to
the nancial statements.
Property, plant and equipment that have been prepaid for will be received in the following nancial
years.
A-37
13. Stocks
31 December
2010 2011 2012
$000 $000 $000
Balance sheet
Packaging and raw materials, at cost 796 1,038 1,587
Finished goods 1,229 2,005 1,320
2,025 3,043 2,907
Less: Allowance for stocks obsolescence (42)
1,983 3,043 2,907
Movement for allowance for stocks obsolescence:
Balance at beginning of the year 55 42
Write-back of allowance for stocks obsolescence (10) (42)
Balance at end of the year 42
During the nancial years ended 31 December 2010, 2011 and 2012, write-back of allowance for
stocks obsolescence of approximately $10,000, $42,000 and $Nil respectively, were made as the
nished goods that were being provided for were sold in the respective years.
31 December
2010 2011 2012
$000 $000 $000
Prot or loss
Stocks recognised as an expense in cost of sales 1,914 797 2,796
14. Trade receivables
31 December
2010 2011 2012
$000 $000 $000
Trade receivables 183 198 137
Trade receivables are non-interest bearing and are generally on 30 to 60 days terms. They are
recognised at their original invoice amounts which represents their fair values on initial recognition.
Trade receivables denominated in foreign currencies at 31 December are as follows:
31 December
2010 2011 2012
$000 $000 $000
United States Dollar 16 19 70
A-38
14. Trade receivables (contd)
Receivables that are past due but not impaired
The aging analysis of trade receivables that were past due at the balance sheet date but not
impaired is as follows:
31 December
2010 2011 2012
$000 $000 $000
Less than one month past due 62 31
More than one month but less than three months
past due 4
Over three months past due 12
62 12 35
Receivables that are impaired
Trade receivables that were impaired at the balance sheet date and the movement of the allowance
account used to record the impairment are as follows:
31 December
2010 2011 2012
$000 $000 $000
Trade receivables nominal amounts 29 41 50
Less: Allowance for doubtful receivables (29) (41) (50)

Movements in allowance for doubtful receivables:
Balance at beginning of the year 41 29 41
(Write back)/allowance for doubtful debts (10) 10 11
Balance at end of the year 29 41 50
Trade receivables that were individually determined to be impaired at the balance sheet date
relate to debtors that are in signicant nancial difculties and have defaulted on payments. These
receivables are not secured by any collateral or credit enhancements.
A-39
15. Other receivables
31 December
2010 2011 2012
$000 $000 $000
Other receivables 158 117 1,480
Amount due from a director related company 7 18 28
Refundable deposits 245 242
165 380 1,750
Receivables that are impaired
Other receivables that were impaired at the balance sheet date and the movement of the allowance
31 December
2010 2011 2012
$000 $000 $000
Other receivables nominal amounts 68 75 38
Less: Allowance for doubtful receivables (68) (75) (38)

Movements in allowance for doubtful receivables:
Balance at beginning of the year 378 68 75
Allowance made/(written-back) 4 (34)
Amount written off (305)
16. Deferred expenses
Deferred expenses represent portion of incremental costs, including professional fees that are
directly attributable to the issuance of new shares upon the listing of the Company. Deferred
expenses will be deducted against share capital when the Group completes the listing of the
Company.
17. Prepayments
31 December
2010 2011 2012
$000 $000 $000
Prepayments 12 9 29
Advances to suppliers 279 304 463
291 313 492
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18. Cash and bank balances
Cash and cash equivalents included in the combined statements of cash ow comprise:
31 December
2010 2011 2012
$000 $000 $000
Cash and bank balances 983 3,213 4,772
Less: Pledged deposits held for mine activities (159) (166) (159)
Cash and cash equivalents 824 3,047 4,613
Cash at bank earns interest at oating rates based on daily bank deposit rates. The weighted
average effective interest rates for pledged deposits as at 31 December 2010, 2011 and 2012 for
the Group were 0.37%, 0.47% and 0.45% respectively.
As at 31 December 2010, 2011 and 2012, the PRC subsidiary has cash and bank balances which
are denominated in Singapore Dollar, of $Nil, $1,282,000 and $2,811,000 respectively.
Cash and bank balances denominated in foreign currencies at 31 December are as follows:
31 December
2010 2011 2012
$000 $000 $000
United States Dollar 62 98 192
19. Trade payables
Trade payables are normally settled on 30 days terms, unsecured, non-interest bearing and are to
be settled in cash.
20. Other payables
31 December
2010 2011 2012
$000 $000 $000
Payables related to:
Taxes other than income tax 1,223 763 228
Payroll and welfare payable 1,109 1,323 356
Property, plant and equipment 501 4,078 7,926
Other payables 889 993 637
Deposits received 109 119 146
Accrued liabilities 680 239 807
Incidental costs in relation to relocation of plant 521 72
Compensation payable for loss of lives in earthquake 37
4,548 8,036 10,172
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20. Other payables (contd)
Other payables are unsecured, non-interest bearing and are repayable on demand.
Other payables denominated in foreign currencies are as follows:
31 December
2010 2011 2012
$000 $000 $000
Canadian Dollar 34 31
British Pound 11
21. Amounts due to ultimate holding company
The amounts due to ultimate holding company represent advances made and are non-trade in
nature, unsecured, interest-free and repayable on demand via capitalisation of debt to share
capital.
For the nancial years ended 31 December 2010, 2011 and 2012, Eastcomm is the immediate and
ultimate holding company of Norwest Chemicals and Mianzhu Norwest respectively.
22. Interest-bearing bank loans
31 December
2010 2011 2012
$000 $000 $000
Short term bank loans 912
Short term bank loans bore interest at 5.84% per annum for the financial years ended
31 December 2010 and 2011 and were repriced within a year.
As at 31 December 2010, short-term bank loans are secured by pledge of xed deposits of
$2,000,000 belonging to the ultimate holding company.

During the nancial year ended 31 December 2011, the loans were fully repaid and the pledge of
xed deposits of $2,000,000 belonging to the ultimate holding company was discharged.
A-42
23. Deferred tax liabilities
The following are the deferred tax liabilities recognised and movements thereon during the years
ended 31 December 2010, 2011 and 2012:
Unutilised
tax losses
Unremitted
foreign
income
Difference in
depreciation
for tax
purpose Total
$000 $000 $000 $000
At 1 January 2010 70 70
Credit to prot or loss during the year
(Note 8) (28) (28)
At 31 December 2010, 1 January 2011
and 31 December 2011 42 42
(Credit)/charge to prot or loss during
the year (Note 8) (1,436) 1,720 284
Currency realignment 28 (34) (6)
At 31 December 2012 (1,408) 42 1,686 320
Unrecognised tax losses
As at 31 December 2010, 2011 and 2012, the Group had tax losses of approximately $6,156,000,
$6,083,000 and $330,000 respectively for offset against future taxable prots of the companies
in which the losses arose, for which no deferred tax asset is recognised due to uncertainty of its
recoverability.
As at 31 December 2012, benefits arising from previously unrecognised tax losses of
approximately $5,745,000 has been recognised as deferred tax assets as one of the Groups
production facility has commenced production and the Group expects future taxable prot to be
available against which the unused tax losses can be utilised.
24. Deferred income
31 December
2010 2011 2012
$000 $000 $000
Balance at beginning of the year 2,247 2,348
Received during the year 2,314
Balance at end of the year 2,247 2,348 2,231
Deferred income received during the nancial year ended 31 December 2010, represented
government grants received for the construction of certain plant and equipment. Deferred income
will be recognised in prot or loss over the expected useful life of the relevant plant and equipment
when the construction of the relevant plant and equipment is complete and capable of operating in
the manner intended by the Group.
A-43
25. Provision for rehabilitation
31 December
2010 2011 2012
$000 $000 $000
Balance at beginning of the year 54 58
Recognised during the year 55 100
Unwinding of discount 2 4
The Group makes provision for the future cost of rehabilitating mine sites on a discounted basis
at a rate of 3.64%, 3.64% and 3.36% as at 31 December 2010, 2011 and 2012 respectively. The
rehabilitation provision represents the present value of rehabilitation costs relating to mine sites,
which are expected to be incurred. These provisions have been created based on the Groups
internal estimates. Assumptions, based on the current economic environment, have been
made which management believes are a reasonable basis upon which to estimate the future
liability. These estimates are reviewed regularly to take into account any material changes to the
assumptions. However, actual rehabilitation costs will ultimately depend upon future market prices
for the necessary decommissioning works required and will depend on market conditions at the
relevant time. Furthermore, the timing of rehabilitation is likely to depend on when the mines cease
to produce at economically viable rates. This, in turn, will depend upon phosphate rocks prices,
which are inherently uncertain.
26. Share capital
31 December
2010 2011 2012
No. of
shares
No. of
shares
No. of
shares
000 $000 000 $000 000 $000
Issued and paid-up
Balance at the beginning of
the year 9,048 9,048 9,048 9,048 21,048 21,048
Issue of new shares 12,000 12,000 11,500 11,500
Balance at the end of the
year 9,048 9,048 21,048 21,048 32,548 32,548
For the purpose of the preparation of the combined balance sheets, issued share capital as at 31
December 2010 and 2011 represent the issued share capital of Norwest Chemicals. The issued
share capital as at 31 December 2012 represents the share capital of the Company and Norwest
Chemicals.
The holders of ordinary shares are entitled to receive dividends as and when declared by the
Company. All ordinary shares carry one vote per share without restrictions. The ordinary shares
have no par value.
A-44
27. Reserves
31 December
2010 2011 2012
$000 $000 $000
Foreign currency translation reserve 1,476 2,011 1,093
Retained earnings (9,190) (6,257) (5,032)
Safety fund surplus reserve
(7,714) (4,246) (3,939)
Foreign currency translation reserve represents exchange differences arising from the translation of
the nancial statements of foreign operation whose functional currency is different from that of the
Groups presentation currency.
In accordance with the Notice regarding Safety Production Expenditure jointly issued by the
Ministry of Finance and the State Administration of Work Safety of the PRC in February 2012,
the PRC subsidiary is required to make appropriation to a Safety Fund Surplus Reserve based
on the volume of mineral ore extracted. The reserve is utilised upon incurrence of specic safety
production expense.
28. (Loss)/earnings per share
For illustrative purposes, basic (loss)/earnings per share was calculated by dividing the Groups
(loss)/prot for the year attributable to owners of the Company by the pre-offering share capital of
702,400,000 ordinary shares.
For illustrative purposes, adjusted (loss)/earnings per share was calculated by dividing the Groups
(loss)/prot for the year attributable to owners of the Company by the post-invitation share capital
of 800,000,000 ordinary shares.
29. Segment information
For management purposes, the Group is organised into business units based on their products and
services and has two reportable segments as follows:
(i) The upstream segment is in the business of exploration, mining and sale of phosphate rocks.
(ii) The downstream segment is in the business of manufacturing, sale and trading of
No operating segments have been aggregated to form the above reportable operating segments.
The Chief Operating Decision Maker monitors the operating results of its business units separately
for the purpose of making decisions about resource allocation and performance assessment.
Segment performance is evaluated based on operating prot or loss which in certain respects, as
explained in the table below, is measured differently from operating prot or loss in the combined
nancial statements. Group nancing (including nance costs) and income taxes are managed
on a group basis and are not allocated to operating segments. The Chief Operating Decision
Maker does not monitor assets and liabilities by segments. The assets and liabilities are managed
on a group basis. However, the information on additions to mine properties, land use rights and
property, plant and equipment by operating segments is regularly provided to the Chief Operating
Decision Maker.
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A-46
29. Segment information (contd)
Note Additional information and nature of adjustments and eliminations to arrive at amounts
reported in the combined nancial statements.
A There were no inter-segment revenue.
B Adjustments relate to unallocated corporate income and expenses.
C The following items were added to segment (loss)/prot to arrive at (loss)/prot before tax
presented in the combined statements of comprehensive income:
31 December
2010 2011 2012
$000 $000 $000
Gain of relocation 1,874 3,471
Reversal of accrued expenses 300 421
Exchange gain/(loss) 21 (24) (178)
Insurance claims 420
Interest on bank loans (52) (7)
Survey and valuation fees (351)
Listing expenses (1,780)
Other corporate expenses (788) (658) (974)
(450) 1,606 539
D Additions to non-current assets comprised of additions to property, plant and equipment,
mine properties and land use rights.
Geographical information
Revenue information based on the geographical location of customers are as follows:
31 December
2010 2011 2012
$000 % $000 % $000 %
Peoples Republic of China 1,257 45 2,447 54 4,373 89
United States of America 778 28 743 16
Switzerland 271 10 141 3
The Philippines 83 3 270 6 139 3
Vietnam 192 7 252 6
New Zealand 112 4 172 4 305 6
United Arab Emirates 26 1 438 9 35 1
Spain 28 1
Others 56 2 31 1 45 1
Total 2,775 100 4,522 100 4,897 100
A-47
Geographical information (contd)
Non-current assets information based on the geographical location of assets is as follows:
31 December
2010 2011 2012
$000 $000 $000
Peoples Republic of China 6,666 22,976 33,176
Singapore 2 12
6,666 22,978 33,188
Non-current assets information presented above consist of property, plant and equipment, mine
properties, land use rights and prepayments as presented in the combined balance sheets.
Information about major customers
Revenue information about major customers are as follows:
31 December
2010 2011 2012
$000 % $000 % $000 %
Customer A
(1)
648 23 688 15
Customer B
(2)
345 12 210 5
Customer C
(2)
712 16 2,024 41
Customer D
(1)
171 6 560 12 176 4
Customer E
(1)
164 6 449 10 137 3
Customer F
(2)
556 11
(1)
These customers contribute to the revenue from the downstream segment.
(2)
These customers contribute to the revenue from the upstream segment.
Information about products
Revenue information based on products are as follows:
31 December
2010 2011 2012
$000 $000 $000
Phosphate Rocks 357 1,496 3,700
Sodium Hexametaphosphate (SHMP) 538 168 232
Sodium Tripolyphosphate (STPP) 1,862 2,858 965
Others 18
2,775 4,522 4,897
A-48
30. Signicant related party transactions
(a) Sale and purchase of goods and services
In addition to the related party information disclosed elsewhere in the nancial statements,
the following signicant transactions between the Group and related parties took place at
terms agreed between the parties during the nancial year:
31 December
2010 2011 2012
$000 $000 $000
Payment on behalf of a director related company 11 11 9
Secondment of staff to a director related company 47
As disclosed in Note 22, short-term bank loans obtained by the Group as at 31 December
2010 were secured by pledge of xed deposits of $2,000,000 belonging to the ultimate
holding company.
(b) Compensation of key management personnel
31 December
2010 2011 2012
$000 $000 $000
Short-term employee benets 304 292 337
All amounts are paid and payable to directors of the subsidiaries.
31. Financial risk management objectives and policies
The Group is exposed to nancial risks arising from its operations and the use of nancial
instruments. The key nancial risks include credit risk, liquidity risk, interest rate risk and foreign
currency risk. The Groups overall business strategies, its tolerance of risks and its general
risk management philosophy are determined by management in accordance with the prevailing
economic and operating conditions. The Board of Directors reviews and agrees policies for
managing these risks.
The following sections provide details regarding the Groups exposure to the above-mentioned
nancial risks and the objectives, policies and processes for the management of these risks.
There has been no change to the Groups exposure to these nancial risks or the manner in which
it manages and measures the risks.
(i) Credit risk
Credit risk is the risk of loss that may arise on outstanding nancial instruments should a
counterparty default on its obligations. The Groups exposure to credit risk arises primarily
from trade and other receivables and cash and bank balances.
A-49
31. Financial risk management objectives and policies (contd)
(i) Credit risk (contd)
The Groups objective is to seek continual revenue growth while minimising losses incurred
due to increased credit risk exposure. The Group trades only with recognised and
creditworthy third parties.
Customers of the Groups phosphate rocks are usually required to make full payment before
they can take delivery of phosphate rocks. The Group generally require customers of our
downstream phosphate-based chemical products to make payment within 30 to 60 days from
the delivery of our products, except new customers where payment in advance is normally
required.
Each customer has a maximum credit limit. The Group seeks to maintain strict control over
its outstanding receivables and overdue balances are reviewed regularly by management.
Exposure to credit risk
The Groups exposure to credit risk is monitored on an ongoing basis. The carrying amounts
of trade and other receivables and cash and bank balances represent the Groups maximum
exposure to credit risk. No other nancial assets carry a signicant exposure to credit risk.
The Group does not require collateral in respect of nancial assets.
Credit risk concentration prole
Concentrations of credit risk are managed by customer. The Group has certain
concentrations of credit risk as 69%, 83% and 88% of the Groups trade receivables were
due from 5 of the Groups customers at 31 December 2010, 2011 and 2012 respectively.
Financial assets that are neither past due nor impaired
Trade and other receivables that are neither past due nor impaired are with creditworthy
debtors with good payment record with the Group. Cash and bank balances are placed with
reputable nancial institutions or companies with high credit ratings and no history of default.
Financial assets that are either past due or impaired
Information regarding nancial assets that are either past due or impaired is disclosed in
Note 14 (Trade receivables) and Note 15 (Other receivables).
(ii) Liquidity risk
Liquidity risk is the risk that the Group will encounter difculty in meeting nancial obligations
due to shortage of funds. The Group is currently in the process of raising additional capital.
In addition, the Group has adopted various cost control measures to reduce various general
and administrative expenses and operating costs, and is expanding its market share in the
Peoples Republic of China market.
A-50
(ii) Liquidity risk (contd)
The table below summarises the maturity prole of the Groups nancial assets and liabilities
at the balance sheet date based on contractual undiscounted payments.
One year
or less
One to ve
years
Over ve
years Total
31 December 2010 $000 $000 $000 $000
Financial assets
Trade receivables 183 183
Other receivables 165 165
Cash and bank balances 983 983
Total undiscounted nancial
assets 1,331 1,331
Financial liabilities
Trade payables (166) (166)
Other payables (4,548) (4,548)
Amounts due to ultimate holding
company (600) (600)
Interest-bearing bank loans (932) (932)
liabilities (6,246) (6,246)
Total net undiscounted nancial
31 December 2011
Financial assets
Cash and bank balances 3,213 3,213
assets 3,791 3,791
Trade payables (470) (470)
company (2,050) (2,050)
liabilities (10,556) (10,556)
A-51
(ii) Liquidity risk (contd)
One year
or less
One to ve
years
Over ve
years Total
31 December 2012 $000 $000 $000 $000
Financial assets
Other receivables 1,750 1,750
assets 6,659 6,659
Trade payables (1,306) (1,306)
company (646) (646)
liabilities (12,124) (12,124)
(iii) Interest rate risk
Interest rate risk is the risk that the fair value or future cash ows of the Groups nancial
instruments will uctuate because of changes in market interest rates. The Groups
exposure to interest rate risk arises primarily from interest-bearing bank loans.
At 31 December 2010, 2011 and 2012, based on the reasonable expected rate of change
in interest rate during the year, the impact to (loss)/prot for the year due to uctuations of
interest rate is not material, holding all other variables constant.
(iv) Foreign currency risk
The Group has transactional currency exposures arising from sales or purchases that are
denominated in currencies other than the respective functional currencies of Groups entities,
primarily, SGD and RMB. For the nancial years ended 31 December 2010, 2011 and 2012,
approximately 55%, 46% and 11% respectively of the Groups sales are denominated in
USD whilst almost 100% of costs are denominated in the respective functional currencies of
the Groups entities. The Group does not enter into any hedging transactions to manage the
potential uctuation in foreign currency as the risk is monitored on an ongoing basis.
The Group does not consider that it has any signicant exposure to the risk of uctuation in
the exchange rate between RMB against USD, as a possible change of 5% in RMB against
USD would have no signicant nancial impact to the Groups nancial performance.
A-52
(iv) Foreign currency risk (contd)
The Groups exposure to the risk of changes in foreign exchange rates relates primarily
to cash and bank balances and SGD denominated loan due from subsidiary as at 31
December 2011 and 2012. At 31 December 2012, if RMB strengthened/weakened against
Singapore Dollar by 5% (2011: 5%), the Groups net prot before tax would have increased/
decreased by $296,000 (2011: $15,000).
The Group is also exposed to currency translation risk arising from its net investment in PRC
operations. The Groups net investment in PRC is not hedged as currency positions in RMB
are considered to be long-term in nature. Such translation gains/losses are of unrealised
nature and do not impact current year prots unless the underlying assets or liabilities of the
subsidiary are disposed.
The RMB is not freely convertible. There is a risk that the Chinese government may take
actions affecting exchange rates which may have an adverse effect on the Groups net
assets, earnings and any dividend if such dividend is to be exchanged or converted into
foreign exchange.
32. Fair value of nancial instruments
The fair value of a nancial instrument is the amount at which the instrument could be exchanged
or settled between knowledgeable and willing parties in an arms length transaction, other than in a
forced or liquidation sale.
Management has determined that the carrying amounts of cash and bank balances, trade and
other receivables, trade and other payables, amounts due to ultimate holding company and
interest-bearing bank loans, based on their notional amounts, reasonably approximate their fair
values because these are mostly short term in nature or are repriced frequently.
A-53
32. Fair value of nancial instruments (contd)
Set out below is a comparison by category of carrying amounts of all of the Groups nancial
instruments that are carried in the nancial statements:
Classication of nancial instruments
Loans and
receivables
Financial
liabilities at
amortised
cost
Non-nancial
assets/
liabilities Total
31 December 2010 $000 $000 $000 $000
Assets
Mine properties 906 906
Land use rights 815 815
Property, plant and equipment 2,346 2,346
Stocks 1,983 1,983
Prepayments 2,890 2,890
Cash and bank balances 983 983
1,331 8,940 10,271
Liabilities
Trade payables 166 166
Other payables 3,439 1,109 4,548
Advances from customers 368 368
company 600 600
Deferred tax liability 42 42
Deferred income 2,247 2,247
Provision for rehabilitation 54 54
5,117 3,820 8,937
A-54
Classication of nancial instruments (contd)
Loans and
receivables
Financial
liabilities at
amortised
cost
Non-nancial
assets/
liabilities Total
31 December 2011 $000 $000 $000 $000
Assets
Land use rights 1,763 1,763
Stocks 3,043 3,043
Deferred expenses 308 308
3,791 26,642 30,433
Liabilities
Other payables 6,713 1,323 8,036
company 2,050 2,050
Deferred tax liability 42 42
9,233 4,398 13,631
A-55
Classication of nancial instruments (contd)
Loans and
receivables
Financial
liabilities at
amortised
cost
Non-nancial
assets/
liabilities Total
31 December 2012 $000 $000 $000 $000
Assets
Stocks 2,907 2,907
6,659 36,930 43,589
Liabilities
Trade payables 1,306 1,306
Other payables 9,816 356 10,172
company 646 646
Deferred tax liabilities 320 320
11,768 3,212 14,980
A-56
33. Commitments
(a) Operating lease commitments as lessee
In addition to the land use rights disclosed in Note 10, the Group has leased ofce premise
under operating lease arrangements. Lease for the ofce premise was negotiated for
terms of two years. At the balance sheet date, the Group had total future minimum lease
payments under non-cancellable operating lease fall due as follows:
31 December
2010 2011 2012
$000 $000 $000
Within one year 173
Between one to two years 130
303
Minimum lease payments recognised as an expense in prot or loss for the nancial years
ended 31 December 2010, 2011 and 2012 amounted to $Nil, $Nil and $43,000.
(b) Capital commitments
The Group had the following capital commitments at the end of the reporting period:
31 December
2010 2011 2012
$000 $000 $000
Contracted but not provided for
- Property, plant and equipment 1,362 2,673 1,395
- Land use right 1,601 708 673
2,963 3,381 2,068
34. Capital management
The primary objective of the Groups capital management is to ensure that it maintains a strong
credit rating and healthy capital ratios in order to support its business and maximise shareholder
value.
The Group manages its capital structure and makes adjustments to it, in light of changes in
economic conditions. To maintain or adjust the capital structure, the Group may adjust the dividend
payment to shareholders, return capital to shareholders or issue new shares.
The Group monitors capital using a gearing ratio, which is net debt divided by total capital plus net
debt. The Group includes within net debt, trade and other payables, advances from customers,
amounts due to ultimate holding company, interest-bearing bank loans less cash and bank
balances. Capital includes ordinary shares and reserves.
A-57
34. Capital management (contd)
For the nancial year ended 2010, the Groups policy was to keep the gearing ratio between 60%
and 85%. The Group seeks to maintain a balance between higher returns that may be possible
with higher levels of borrowings and the advantages and security afforded by a sound capital
position. From the nancial year ended 2011, the Group has changed its approach to capital
management to be more equity-based following its decision to pursue an initial public offering. The
Groups new policy is to keep the gearing ratio between 25% and 40%.
As at 31 December 2012, the Groups gearing ratio is 20.8% due to the issuance of 7,000,000 new
shares at $1 each on 25 June 2012 and 4,500,000 new shares at $1 each on 17 September 2012.
The Group is monitoring its gearing ratio to adhere to its capital management policy by sourcing for
loans and borrowings.
31 December
2010 2011 2012
$000 $000 $000
Trade payables 166 470 1,306
Other payables 4,548 8,036 10,172
Amounts due to ultimate holding company 600 2,050 646
Interest-bearing bank loans 912
Less: Cash and bank balances (983) (3,213) (4,772)
Net debt 5,611 7,970 7,499
Total capital 1,334 16,802 28,609
Capital and net debt 6,945 24,772 36,108
Gearing ratio 80.8% 32.2% 20.8%
35. Events after balance sheet date
(a) Subsequent to balance sheet date, on 21 January 2013, Norwest Chemicals issued
1,846,400 new shares to the ultimate holding company, Eastcomm, via capitalisation of debt
of $646,400 and for cash consideration of $1,200,000.
(b) On 1 February 2013, Mianzhu Norwest obtained a bank loan of RMB5 million (approximately
$987,000) from a bank in the PRC.
(c) The Restructuring Exercise as described in Note 2 has been completed on 16 September
2013.
A-58
35. Events after balance sheet date (contd)
(d) Following the completion of the construction of the P
4
Plant in 2012, Mianzhu Norwest has
been engaged in discussions with one of Mianzhu Norwests construction contractors (the
Contractor), to determine the aggregate amount payable by Mianzhu Norwest for certain
construction works performed and completed by the Contractor (which includes works
carried out pursuant to variation orders).
Arbitration proceedings commenced by the Contractor were accepted by the
(Deyang Arbitration Commission) (DAC) on 27 August 2013, and a (notice
to participate in arbitration) was received by Mianzhu Norwest on 5 September 2013.
Based on the (settlement document) dated 5 September 2013 issued by the
DAC, the Contractor and Mianzhu Norwest agreed that the aggregate amount payable
for all construction works performed and completed by the Contractor would be RMB 35
million, and that as RMB 26 million had already been paid by Mianzhu Norwest prior to
the arbitration proceedings, Mianzhu Norwest would pay the remaining balance within the
next 12 months. The arbitration and related costs were stipulated in the (settlement
document) to be borne by the Contractor.
The amount has been adequately provided for in the combined balance sheet as at 31
December 2012.
36. Authorisation of nancial statements
The audited combined nancial statements as at and for the nancial years ended 31 December
2010, 2011 and 2012 were authorised for issue by the Board of Directors on 25 September 2013.
B-1
APPENDIX B: UNAUDITED INTERIM CONDENSED COMBINED FINANCIAL
STATEMENTS FOR THE THREE MONTHS PERIOD ENDED 31 MARCH 2013
Independent Auditors Review Report
on Interim Condensed Combined Financial Statements of
For the three months period ended 31 March 2013
25 September 2013
AsiaPhos Limited
Dear Sirs:
Introduction
We have reviewed the accompanying interim condensed combined balance sheet of AsiaPhos Limited
and its subsidiaries (collectively the Group) as at 31 March 2013 and the related interim condensed
combined statements of comprehensive income, changes in equity and cash flow for the three
months period then ended and explanatory notes. Management is responsible for the preparation and
presentation of these interim condensed nancial statements in accordance with Singapore Financial
Reporting Standard FRS 34 Interim Financial Reporting. Our responsibility is to express a conclusion on
these interim condensed combined nancial statements based on our review.
Scope of review
We conducted our review in accordance with Singapore Standard on Review Engagements 2410,
Review of Interim Financial Information Performed by the Independent Auditor of the Entity. A review of
interim nancial information consists of making inquiries, primarily of persons responsible for nancial and
accounting matters, and applying analytical and other review procedures. A review is substantially less
in scope than an audit conducted in accordance with Singapore Standards on Auditing. Consequently, it
does not enable us to obtain assurance that we would become aware of all signicant matters that might
be identied in an audit. Accordingly, we do not express an audit opinion.
Conclusion
Based on our review, nothing has come to our attention that causes us to believe that the accompanying
interim condensed combined financial statements are not prepared, in all material respects, in
accordance with FRS 34.
R estriction on Distribution and Use
ERNST & YOUNG LLP
Singapore
Partner-in-Charge: Ng Boon Heng
B-2
Interim Condensed Combined Statements of Comprehensive Income
Note Group
1.1.2013 to
31.3.2013
1.1.2012 to
31.3.2012
$000 $000
Unaudited Unaudited
Revenue 1,310 1,004
Cost of sales (865) (648)
Gross prot 445 356
Other income 4 8 1,361
Selling and distribution costs (87) (53)
General and administrative costs (1,105) (489)
Finance costs 5 (10) (1)
(Loss)/prot before tax 5 (749) 1,174
Taxation 6
(Loss)/prot for the period attributable to the owners
of the Company (749) 1,174
Other comprehensive income
Foreign currency translation 365 (448)
Total comprehensive (loss)/income for the period
attributable to owners of the Company (384) 726
(Loss)/earnings per share (in cents)
Basic 16 (0.11) 0.17
Adjusted 16 (0.09) 0.15
The accounting policies and explanatory notes form an integral part of the interim condensed combined
nancial statements. The comparatives have not been reviewed nor audited.
B-3
Interim Condensed Combined Balance Sheets as at 31 March 2013
Note
31 March
2013
31 December
2012
$000 $000
Unaudited Audited
Non-current assets
Land use rights 7 1,664 1,642
Property, plant and equipment 8 28,441 28,778
32,888 33,188
Current assets
Stocks 3,275 2,907
Trade receivables 9 462 137
Prepayments 487 492
9,547 10,401
Total Assets 42,435 43,589
Current liabilities
Trade payables 797 1,306
Other payables 11 7,795 10,172
Amounts due to ultimate holding company 12 646
Interest-bearing bank loan 13 987
9,604 12,271
Net current liabilities (57) (1,870)
2,760 2,709
Total liabilities 12,364 14,980
Net assets 30,071 28,609
Share capital 14 34,394 32,548
Reserves 15 (4,323) (3,939)
Total equity 30,071 28,609
nancial statements.
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Interim Condensed Combined Statements of Cash Flow
1.1.2013 to
31.3.2013
1.1.2012 to
31.3.2012
$000 $000
Unaudited Unaudited
(Loss)/prot before tax (749) 1,174
Adjustments for:
Depreciation of property, plant and equipment 91 58
Amortisation of mine properties and land use rights 45 42
Interest on bank loan 9
Interest income (1) (1)
Loss on disposal of property, plant and equipment 1
Gain on relocation (1,300)
Listing expenses 437
Operating loss before working capital changes (166) (26)
(Increase)/decrease in stocks (312) 223
Increase in receivables (210) (395)
Decrease in payables (853) (208)
Cash used in operations (1,541) (406)
Interest received 1 1
Interest paid (9)
Net cash ows used in operating activities (1,549) (405)
Purchase of property, plant and equipment (1,758) (2,490)
Payments for mine properties (30)
Compensation proceeds from government for relocation of factory 1,300
Incidental costs in relation to relocation (436)
Net cash ows used in investing activities (1,758) (1,656)
B-6
Interim Condensed Combined Statements of Cash Flow
1.1.2013 to
31.3.2013
1.1.2012 to
31.3.2012
$000 $000
Unaudited Unaudited
Proceeds from bank loan 984
Amount due to ultimate holding company 1,096
Proceeds from issue of new shares 1,200
Payments incurred in relation to the initial public offering (296) (196)
Net cash ows generated from nancing activities 1,888 900
Net decrease in cash and cash equivalents (1,419) (1,161)
Cash and cash equivalents at beginning of the period 4,613 3,047
Effects of exchange rate changes on cash and cash equivalents (179) (47)
Cash and cash equivalents at end of the period (Note 10) 3,015 1,839
Notes to the combined statements of cash ow
(a) Purchase of property, plant and equipment
1.1.2013 to
31.3.2013
1.1.2012 to
31.3.2012
$000 $000
Unaudited Unaudited
Current year additions (Note 8) 955 1,436
Less: Prepayments made in prior years (2,251)
Sale of samples produced when testing equipment (537)
Decrease in payables related to property, plant and equipment 1,340 3,305
Net cash outow for purchase of property, plant and equipment 1,758 2,490
B-7
Notes to the Unaudited Interim Condensed Combined Financial Statements
1 . Corporate information
1.1 The Company
AsiaPhos Limited (the Company) was incorporated in the Republic of Singapore on 3 January
2012 as a private company limited by shares under the name of AsiaPhos Private Limited. On
6 September 2013, the Company changed its name to AsiaPhos Limited in connection with its
conversion to a public company limited by shares. The Company was incorporated for the purpose
of acquiring the subsidiaries pursuant to the Restructuring Exercise as described in Note 2 to the
interim condensed combined nancial statements.
Road, #17-00, AIA Tower, Singapore 048542 and 600 North Bridge Road Parkview Square #12-01,
Singapore 188778 respectively.
subsidiaries are disclosed in Note 2.1.
AsiaPhos Limited and its subsidiaries (collectively, the Group) operate in Singapore and the
Peoples Republic of China.
The ultimate holding company of the Group is Eastcomm Pte Ltd (Eastcomm) a company
incorporated in Singapore.
1.2 Seasonality of Operations
The Groups mining operations are halted annually during (i) the winter months, which typically
last from mid-December to mid-March, because of low temperatures and snow; and (ii) the
rainy season, which typically lasts from early July to the end of August. Barring unforeseen
circumstances, the Group undertakes mining operations for about seven (7) months per year on a
daily basis, subject to, inter alia, holidays, weather conditions and equipment maintenance.
During the low-water periods, which typically last from mid-November to mid-April, the Groups
electricity costs increase and the Group may not produce certain products which require high levels
of electricity.
B-8
as follows:
Note 2(d) below).
64,000,008 shares.
supplemental letters with various parties (the Noteholders).
Noteholders.
from Eastcomm.
B-9
2.1 The Subsidiaries
The subsidiaries of the Company subsequent to the Restructuring Exercise are as follow:
Name of company
(Country of
registration)
Principal activity
(Place of business)
Effective ownership held by
the Group subsequent to the
Restructuring Exercise
Norwest Chemicals Pte Ltd
#

Investing in chemical projects general
wholesale trade and trading of
chemicals
100%
Held by Norwest Chemicals
Sichuan Mianzhu Norwest
Phosphate Chemical Company
Limited *
phosphate rocks, the production and
sale of phosphorus and phosphate
based chemical products
100%
#
Audited by Ernst & Young LLP, Singapore
* Audited by Ernst & Young Hua Ming LLP, Chengdu Branch
For the nancial year ended 31 December 2012 and periods ended 31 March 2012 and 2013,
Eastcomm is the immediate and ultimate holding company of Norwest Chemicals and Mianzhu
Norwest is a wholly owned subsidiary of Norwest Chemicals.
Although the Company was incorporated on 3 January 2012 and the Restructuring Exercise
was completed on 16 September 2013, the interim condensed combined nancial statements
presented for the three months period ended 31 March 2013 for the purpose of inclusion in the
Offer Document are that of the Company and its subsidiaries prepared in accordance with RAP
12 Merger Accounting for Common Control Combinations for nancial statements prepared under
Part IX of the Fifth Schedule to the Securities and Futures (Offers of Investments) (Shares and
Debentures) Regulations 2005.
The substance is that the Group is a continuation of Norwest Chemicals and Mianzhu Norwest.
The interim condensed combined nancial statements of the Group for the three months period
ended 31 March 2013 have been presented as if the Group had been in existence for all periods
presented and the assets and liabilities are brought into the interim condensed combined nancial
statements at the existing carrying amounts. The retained earnings recognised in the interim
condensed combined nancial statements are the retained earnings of the Company, Norwest
Chemicals and Mianzhu Norwest as at 31 December 2012, 31 March 2012 and 2013.
B-10
3. Summary of signicant accounting policies
3.1 Basis of preparation
The unaudited interim condensed combined nancial statements of the Group for the three months
ended 31 March 2013 have been prepared in accordance with Singapore Financial Reporting
Standard FRS 34 Interim Financial Reporting.
The interim condensed combined nancial statements do not include all the information and
disclosures required in the annual nancial statements, and should be read in conjunction with the
Groups audited combined nancial statements as at 31 December 2012.
The nancial statements have been prepared on a historical cost basis and are presented in
Singapore Dollar (SGD or $). All values in the tables are rounded to the nearest thousand ($000)
as indicated.
3.2 Fundamental accounting concept
As at 31 March 2013, the Groups current liabilities exceeded its current assets by $57,000 (31
December 2012: $1,870,000).
The directors have prepared the interim condensed combined nancial statements on a going
concern basis as the directors are of the view that the Group will be able to generate net cash
inows from its operating activities for a period of 12 months from the date these nancial
statements were approved.
Accordingly, the directors are of the view that the use of the going concern assumption is
appropriate for the preparation of the nancial statements of the Group to enable it to meet its
nancial obligations as and when they fall due.
3.3 Changes in accounting policies
The accounting policies adopted in the preparation of the interim condensed combined nancial
statements are consistent with those used in the preparation of the Groups audited combined
nancial statements for the year ended 31 December 2012, except for the adoption of new
standards and interpretations as of 1 January 2013, noted below:
Description
periods beginning
on or after
Amendments to FRS 1 Presentation of Items of Other
Comprehensive Income 1 July 2012
Revised FRS 19 Employee Benets 1 January 2013
FRS 113 Fair Value Measurement 1 January 2013
Amendments to FRS 107 Disclosures Offsetting Financial Assets
and Financial Liabilities 1 January 2013
Improvements to FRSs 2012 1 January 2013
Amendment to FRS 1 Presentation of Financial Statements 1 January 2013
Amendment to FRS 16 Property, Plant and Equipment 1 January 2013
Amendment to FRS 32 Financial Instruments: Presentation 1 January 2013
B-11
3.3 Changes in accounting policies (contd)
Except for the Amendments to FRS 1, the directors expect that the adoption of the other standards
and interpretations above will have no material impact on the nancial statements in the period of
initial application. The nature of the changes in accounting policy on adoption of the Amendments
to FRS 1 is described below.
Amendments to FRS 1 Presentation of Items of Other Comprehensive Income
The Amendments to FRS 1 Presentation of Items of Other Comprehensive Income (OCI) is
effective for nancial periods beginning on or after 1 July 2012.
The Amendments to FRS 1 changes the grouping of items presented in OCI. Items that could
be reclassied to prot or loss at a future point in time would be presented separately from items
which will never be reclassied. As the Amendments only affect the presentations of items that are
already recognised in OCI, there is no impact on the Groups nancial position or performance from
the adoption of this standard.
3.4 Standards issued but not yet effective
The Group has not adopted the following standards and interpretations that have been issued but
are not yet effective.
Description
periods beginning
on or after
Revised FRS 27 Separate Financial Statements 1 January 2014
Revised FRS 28 Investments in Associates and Joint Ventures 1 January 2014
FRS 110 Consolidated Financial Statements 1 January 2014
FRS 111 Joint Arrangements 1 January 2014
FRS 112 Disclosure of Interests in Other Entities 1 January 2014
Amendments to FRS 32 Offsetting Financial Assets and Financial Liabilities 1 January 2014
Amendments to FRS 110, FRS 111 and FRS 112 Transition Evidence 1 January 2014
Amendments to FRS 110, FRS 112 and FRS 27 Investment Entities 1 January 2014
Except for the Amendments to FRS 112, the directors expect that the adoption of the other
standards and interpretations above will have no material impact on the nancial statements in the
period of initial application. The nature of the impending changes in accounting policy on adoption
of the Amendments to FRS 112 is described below.
FRS 112 Disclosure of Interests in Other Entities
FRS 112 Disclosure of Interests in Other Entities is effective for nancial periods beginning on or
after 1 January 2014.
FRS 112 is a new and comprehensive standard on disclosure requirements for all forms of
interests in other entities, including joint arrangements, associates, special purpose vehicles and
other off balance sheet vehicles. FRS 112 requires an entity to disclose information that helps
users of its nancial statements to evaluate the nature and risks associated with its interests in
other entities and the effects of those interests on its nancial statements. As this is a disclosure
standard, it will have no impact to the nancial position and nancial performance of the Group
when implemented in 2014.
B-12
4. Other income
1.1.2013 to
31.3.2013
1.1.2012 to
31.3.2012
$000 $000
Unaudited Unaudited
Interest income 1 1
Subsidy income 1 42
Sale of scrap 17
Gain on relocation 1,300
Others 6 1
8 1,361
5. (Loss)/prot before taxation
The following items have been (charged)/credited in arriving at prot/(loss) before taxation:
1.1.2013 to
31.3.2013
1.1.2012 to
31.3.2012
$000 $000
Unaudited Unaudited
Amortisation of mine properties (36) (33)
Amortisation of land use rights (9) (9)
Depreciation of property, plant and equipment (91) (58)
Loss on disposal of property, plant and equipment* (1)
Exchange gain/(loss)* 60 (25)
Staff costs (195) (195)
Dened contribution plan (45) (50)
Directors fees* (33)
Directors remuneration* (90) (53)
Listing expenses* (437)
Finance costs
Interest on bank loan (9)
Unwinding of discount for provision for rehabilitation (1) (1)
* Included in General and administrative costs in the combined statement of comprehensive income.
B-13
6. Taxation
1.1.2013 to
31.3.2013
1.1.2012 to
31.3.2012
$000 $000
Unaudited Unaudited
Taxation in respect of current period
A reconciliation of the corporate tax rate of the Company to the average effective tax rate of the
Group for the nancial periods ended 31 March 2012 and 2013 is as follows:
1.1.2013 to
31.3.2013
1.1.2012 to
31.3.2012
% %
Unaudited Unaudited
Domestic statutory tax rates (17.0) 17.0
Adjustments on tax effect of:
Non-deductible expenses 12.8 0.4
Non-taxable income (2.1)
Benets from tax losses not recognised 6.5 (12.4)
Differences in tax rates (0.2) (5.0)
Effective tax rate
No provision for income tax has been made by the Group for the nancial periods ended 31 March
2012 and 2013 as the Group did not have any assessable prots subjected to tax during the
respective periods.
B-14
7. Land use rights
31 March
2013
31 December
2012
$000 $000
Unaudited Audited
Cost
At 1 January 1,675 1,763
Currency realignment 32 (88)
At 31 March 2013/31 December 2012 1,707 1,675
At 1 January 33
Currency realignment 1 (1)
Amortisation for the period/year 9 34
At 31 March 2013/31 December 2012 43 33
Net carrying amount 1,664 1,642
Amount to be amortised:
Not later than one year 34 34
Later than one year but not more than ve years 136 137
Later than ve years 1,494 1,471
1,664 1,642
Remaining useful lives 48 49
Land use rights represent cost of land use rights in respect of a leasehold land located in Sichuan,
PRC.
At 31 March 2013, land use rights of $1,664,000 (2012: nil) was pledged to a bank for an interest-
bearing bank loan granted to the PRC subsidiary (Note 13).
Amortisation of land use rights are recognised in the General and administrative costs in the
Statement of Comprehensive Income.
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B-17
9. Trade receivables
31 March
2013
31 December
2012
$000 $000
Unaudited Audited
Note receivable 198
462 137
Trade receivables are non-interest bearing and are generally on 30 to 60 days terms. They are
recognised at their original invoice amounts which represents their fair values on initial recognition.
Note receivable is a promissory note from a customer, due to mature in June 2013.
Trade receivables denominated in foreign currencies at end of period/year are as follows:
31 March
2013
31 December
2012
$000 $000
Unaudited Audited
United States Dollar 112 70
Receivables that are past due but not impaired
The aging analysis of trade receivables that are past due at the balance sheet date but not
impaired is as follows:
31 March
2013
31 December
2012
$000 $000
Unaudited Audited
Less than one month past due 4 31
More than one month but less than three months past due 29 4
B-18
9. Trade receivables (contd)
Trade receivables that are impaired
Trade receivables that were impaired at the balance sheet date and the movement of the allowance
31 March
2013
31 December
2012
$000 $000
Unaudited Audited
Trade receivables nominal amounts 49 50
Less: Allowance for doubtful receivables (49) (50)

Movements in allowance for doubtful trade receivables:
Balance at beginning of the period/year 50 41
Currency realignment (1) (2)
Allowance for doubtful debts 11
Balance at end of the period/year 49 50
Trade receivables that are individually determined to be impaired at the balance sheet date relate
to debtors that are in signicant nancial difculties and have defaulted on payments. These
receivables are not secured by any collateral or credit enhancements.
Cash and bank balances included in the combined statements of cash ow comprise:
31 March
2013
31 December
2012
$000 $000
Unaudited Audited
Less: Pledged deposits held for mine activities (162) (159)
Cash at bank earns interest at oating rates based on daily bank deposit rates. The weighted
average effective interest rates for pledged deposits as at 31 December 2012 and 31 March 2013
for the Group were 0.45% and 0.37% respectively.
As at 31 December 2012 and 31 March 2013, the PRC subsidiary has cash and bank balances
which are denominated in Singapore Dollar of $2,811,000 and $551,000 respectively.
B-19
10. Cash and bank balances (contd)
Cash and bank balances denominated in foreign currency at end of the period/year are as follows:
31 March
2013
31 December
2012
$000 $000
Unaudited Audited
United States Dollar 139 192
11. Other payables
31 March
2013
31 December
2012
$000 $000
Unaudited Audited
Payables related to:
Taxes other than income tax 514 228
Payroll and welfare payable 302 356
Other payables 559 637
Deposits received 443 146
Accrued liabilities 914 807
Incidental costs in relation to relocation of plant 73 72
7,795 10,172
Other payables are unsecured, non-interest bearing and are repayable on demand.
Other payables denominated in foreign currency at end of the period/year are as follows:
31 March
2013
31 December
2012
$000 $000
Unaudited Audited
Canadian Dollar 31
At 31 December 2012, the amounts due to ultimate holding company represent advances made
and are non-trade in nature, unsecured, interest-free and repayable on demand via capitalisation of
debt to share capital.
On 21 January 2013, Norwest Chemicals issued 646,400 new shares to ultimate holding company
via capitalisation of debt of $646,400.
B-20
13. Interest-bearing bank loan
At 31 March 2013, short term bank loan bears interest at 5% per annum for the nancial period
ended 31 March 2013, is repriced within a year and due in February 2014.
Short term bank loan is secured by land use rights with net book value of $1,664,000 (2012: Nil)
(Note 7).
14. Share capital
31 March 2013 31 December 2012
No. of
shares
No. of
shares
$000 $000 $000 $000
Unaudited Unaudited Audited Audited
Issued and paid-up
Balance at the beginning
of the period/year 32,548 32,548 21,048 21,048
Issue of new shares 1,846 1,846 11,500 11,500
Balance at the end
of the period/year 34,394 34,394 32,548 32,548
On 21 January 2013, Norwest Chemicals issued 1,846,400 new shares to ultimate holding
company via capitalisation of debt of $646,400 and for cash consideration of $1,200,000.
For the purpose of the preparation of the combined balance sheets, issued share capital as at 31
December 2012 and 31 March 2013 represents the share capital of the Company and Norwest
Chemicals.
The holders of ordinary shares are entitled to receive dividends as and when declared by the
Company. All ordinary shares carry one vote per share without restrictions. The ordinary shares
have no par value.
15. Reserves
31 March
2013
31 December
2012
$000 $000
Unaudited Audited
Foreign currency translation reserve 1,458 1,093
Accumulated losses (5,781) (5,032)
Safety fund surplus reserve
(4,323) (3,939)
B-21
15. Reserves (contd)
Foreign currency translation reserve represents exchange differences arising from the translation of
the nancial statements of foreign operation whose functional currency is different from that of the
Groups presentation currency.
In accordance with the Notice regarding Safety Production Expenditure jointly issued by the
Ministry of Finance and the State Administration of Work Safety of the PRC in February 2012,
the PRC subsidiary is required to make appropriation to a Safety Fund Surplus Reserve based
on the volume of mineral ore extracted. The reserve is utilised upon incurrence of specic safety
production expense.
16. (Loss)/earnings per share
For illustrative purposes, basic (loss)/earnings per share is calculated by dividing the Groups
(loss)/prot for the period attributable to owners of the Company by the pre-offering share capital of
For illustrative purposes, adjusted (loss)/earnings per share is calculated by dividing the Groups
(loss)/prot for the period attributable to owners of the Company by the post-invitation share capital
of 800,000,000 ordinary shares.
17. Segment information
For management purposes, the Group is organised into business units based on their products and
services and has two reportable segments as follows:
(i) The upstream segment is in the business of exploration, mining and sale of phosphate rocks.
(ii) The downstream segment is in the business of manufacturing, sale and trading of
No operating segments have been aggregated to form the above reportable operating segments.
The Chief Operating Decision Maker monitors the operating results of its business units separately
for the purpose of making decisions about resource allocation and performance assessment.
Segment performance is evaluated based on operating prot or loss which in certain respects, as
explained in the table below, is measured differently from operating prot or loss in the combined
nancial statements. Group nancing (including nance costs) and income taxes are managed
on a group basis and are not allocated to operating segments. The Chief Operating Decision
Maker does not monitor assets and liabilities by segments. The assets and liabilities are managed
on a group basis. However, the information on additions to mine properties, land use rights and
property, plant and equipment by operating segments is regularly provided to the Chief Operating
Decision Maker.
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B-23
Note Additional information and nature of adjustments and eliminations to arrive at amounts
reported in the interim condensed combined nancial statements.
A There were no inter-segment revenue.
B Adjustments relate to unallocated corporate income and expenses.
C The following items were added to segment (loss)/prot to arrive at (loss)/prot before tax
presented in the interim condensed combined statements of comprehensive income:
1.1.2013 to
31.3.2013
1.1.2012 to
31.12.2012
$000 $000
Unaudited Audited
Gain of relocation 1,300
Exchange gain/(loss) 60 (25)
Interest on bank loan (9)
Listing expenses (437)
Other corporate expenses (273) (202)
(659) 1,073
D Additions to non-current assets comprised of additions to property, plant and equipment and
mine properties.
Geographical information
Revenue information based on the geographical location of customers is as follows:
1.1.2013 to 31.3.2013 1.1.2012 to 31.3.2012
$000 % $000 %
Unaudited Unaudited Unaudited Unaudited
Peoples Republic of China 1,191 91 883 87
The Philippines 56 6
New Zealand 31 3 61 6
Spain 67 5
Others 21 1 4 1
Total 1,310 100 1,004 100
B-24
Non-current assets information based on the geographical location of assets is as follows:
31 March
2013
31 December
2012
$000 $000
Unaudited Audited
Peoples Republic of China 32,877 33,176
Singapore 11 12
32,888 33,188
Non-current assets information presented above consist of property, plant and equipment, mine
properties, land use rights and prepayments as presented in the interim condensed combined
balance sheets.
Information about major customers
Revenue information about major customers is as follows:
1.1.2013 to 31.3.2013 1.1.2012 to 31.3.2012
$000 % $000 %
Unaudited Unaudited Unaudited Unaudited
Customer A
(1)
824 62.9
Customer B
(2)
43 3.3 113 11.3
Customer C
(1)
185 18.4
Customer D
(1)
159 15.8
Customer E
(1)
220 21.9
(1)
These customers contribute to revenue from the upstream segment.
(2)
These customers contribute to revenue from the downstream segment.
Information about products
Revenue information based on products is as follows:
1.1.2013 to
31.3.2013
1.1.2012 to
31.3.2012
$000 $000
Unaudited Unaudited
Phosphate Rocks 969 607
Sodium Hexametaphosphate (SHMP) 62 65
Sodium Tripolyphosphate (STPP) 279 332
1,310 1,004
B-25
18. Signicant related party transactions
(a) Sale and purchase of goods and services
In addition to the related party information disclosed elsewhere in the nancial statements,
the following signicant transactions between the Group and related parties took place at
terms agreed between the parties during the period:
1.1.2013 to
31.3.2013
1.1.2012 to
31.3.2012
$000 $000
Unaudited Unaudited
Payment on behalf of a director related company 3
(b) Compensation of key management personnel
1.1.2013 to
31.3.2013
1.1.2012 to
31.3.2012
$000 $000
Unaudited Unaudited
Short-term employee benets 90 86
All amounts are paid and payable to directors of the subsidiaries.
19. Commitments
(a) Operating lease commitments as lessee
In addition to the land use rights disclosed in Note 7, the Group has leased ofce premise
under operating lease arrangements. Lease for the ofce premise was negotiated for
terms of two years. At the balance sheet date, the Group had total future minimum lease
payments under non-cancellable operating lease fall due as follows:
31 March
2013
31 December
2012
$000 $000
Unaudited Audited
Within one year 173 173
Between one to two years 86 130
259 303
Minimum lease payments recognised as an expense in prot or loss for the nancial periods
ended 31 March 2012 and 2013 amounted to $Nil and $43,000 respectively.
B-26
19. Commitments (contd)
(b) Capital commitments
The Group had the following capital commitments at balance sheet date:
31 March
2013
31 December
2012
$000 $000
Unaudited Audited
Contracted but not provided for
- Property, plant and equipment 342 1,395
- Land use rights 685 673
1,027 2,068
20. Comparative gures
The comparative gures of the interim condensed combined nancial statements for the three
months period ended 31 March 2012 have not been audited nor reviewed.
(a) The Restructuring Exercise as described in Note 2 has been completed on 16 September
2013.
(b) Following the completion of the construction of the P
4
Plant in 2012, Mianzhu Norwest has
been engaged in discussions with one of Mianzhu Norwests construction contractors (the
Contractor), to determine the aggregate amount payable by Mianzhu Norwest for certain
construction works performed and completed by the Contractor (which includes works
carried out pursuant to variation orders).
Arbitration proceedings commenced by the Contractor were accepted by the
(Deyang Arbitration Commission) (DAC) on 27 August 2013, and a (notice
to participate in arbitration) was received by Mianzhu Norwest on 5 September 2013.
Based on the (settlement document) dated 5 September 2013 issued by the
DAC, the Contractor and Mianzhu Norwest agreed that the aggregate amount payable
for all construction works performed and completed by the Contractor would be RMB 35
million, and that as RMB 26 million had already been paid by Mianzhu Norwest prior to
the arbitration proceedings, Mianzhu Norwest would pay the remaining balance within the
next 12 months. The arbitration and related costs were stipulated in the (settlement
document) to be borne by the Contractor.
The amount has been adequately provided for in the combined balance sheet as at 31
March 2013.
22. Authorisation of nancial statements
The unaudited interim condensed combined nancial statements as at 31 March 2013 and for the
nancial period from 1 January 2013 to 31 March 2013 were authorised for issue in accordance
with a resolution of the directors on 25 September 2013.
C-1
APPENDIX C: UNAUDITED PRO FORMA COMBINED FINANCIAL INFORMATION
FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2012 AND THE THREE
MONTHS PERIOD ENDED 31 MARCH 2013
Unaudited Pro Forma Combined Financial Information of
For the nancial year ended 31 December 2012 and
the three months period ended 31 March 2013
25 September 2013
AsiaPhos Limited
Dear Sirs:
We have completed our assurance engagement to report on the compilation of pro forma nancial
information of AsiaPhos Limited (formerly known as AsiaPhos Private Limited) (the Company) and its
subsidiaries (collectively, the Group) by the management. The pro forma nancial information consist
of the pro forma balance sheets as at 31 December 2012 and 31 March 2013, the pro forma statement
of comprehensive income for the year ended 31 December 2012 and the three months period ended 31
March 2013, the pro forma statement of cash ow for the year ended 31 December 2012 and the three
months period ended 31 March 2013, and related notes as set out on pages C-4 to C-16 of the Offer
Document issued by the Company. The applicable criteria on the basis of which the management has
compiled the pro forma nancial information are described in Note 2 and Note 3.
The pro forma nancial information has been compiled by the management to illustrate the impact of
Restructuring Exercise and events after balance sheet date set out in Note 2 and Note 3, on the Groups
nancial position as at 31 December 2012 and 31 March 2013, and the Groups nancial performance
and cash ows for the year ended 31 December 2012 and the three months period ended 31 March
2013 as if the Restructuring Exercise and events after balance sheet date had taken place at 1 January
2012 and 2013 respectively. As part of this process, information about the Groups nancial position,
nancial performance and cash ows has been extracted by the management from the Groups nancial
statements for the year ended 31 December 2012 and the three months period ended 31 March 2013, on
which an audit and a review report has been published respectively.
Managements Responsibility for the Pro Forma Financial Information
The management is responsible for compiling the pro forma nancial information on the basis of the
applicable criteria stated in Note 2 and Note 3 of the pro forma nancial information.
C-2
Practitioners Responsibilities
Our responsibility is to express an opinion about whether the pro forma nancial information has been
complied, in all material respects, by the management on the basis of the applicable criteria stated in
Note 2 and Note 3 of the pro forma nancial information.
We conducted our engagement in accordance with Singapore Standard on Assurance Engagements
(SSAE) 3420, Assurance Engagements to Report on the Compilation of Pro Forma Financial Information
Included in a Prospectus, issued by the Institute of Singapore Chartered Accountants. This standard
requires that the practitioner comply with ethical requirements and plan and perform procedures to obtain
reasonable assurance about whether the management has complied, in all material respects, the pro
forma nancial information on the basis of the applicable criteria stated in Note 2 and Note 3 of the pro
forma nancial information.
For the purpose of this engagement, we are not responsible for updating or reissuing any reports or
opinions on any historical nancial information used in compiling the pro forma nancial information, nor
have we, in the course of this engagement, performed an audit or review of the nancial information used
in compiling the pro forma nancial information.
The purpose of pro forma nancial information included in an Offer Document is solely to illustrate the
impact of a signicant event or transaction on unadjusted nancial information of the entity as if the
event had occurred or the transaction had been undertaken at an earlier date selected for purposes of
the illustration. Accordingly, we do not provide any assurance that the actual outcome of the event or
transaction at 31 December 2012 and 31 March 2013 would have been as presented.
A reasonable assurance engagement to report whether the pro forma nancial information has been
compiled, in all material respects, on the basis of the applicable criteria involves performing procedures
to assess whether the applicable criteria used by the management in the compilation of the pro forma
nancial information provide a reasonable basis for presenting the signicant effects directly attributable
to the event or transaction, and to obtain sufcient appropriate evidence about whether:
The related pro forma adjustment give appropriate effect to those criteria; and
The pro forma nancial information reects the proper application of those adjustments to the
unadjusted nancial information.
The procedure selected depend on the practitioners judgement, having regard to the practitioners
understanding of the nature of the company, the event or transaction in respect of which the pro forma
nancial information has been compiled, and other relevant engagement circumstances.
The engagement also involves evaluating the overall presentation of the pro forma nancial information.
We believe that the evidence we have obtained is sufcient and appropriate to provide a basis for our
opinion.
C-3
Opinion
In our opinion:
(a) The pro forma nancial information has been complied:
(i) in a manner consistent with the accounting policies adopted by AsiaPhos Limited in its
latest audited nancial statements, which are in accordance with the Singapore Financial
Reporting Standards; and
(ii) on a basis of the applicable criteria stated in Note 2 and Note 3 of the pro forma nancial
information; and
(b) each material adjustment made to the information used in the preparation of the pro forma nancial
information is appropriate for the purpose of preparing such unaudited nancial information.
Restriction on Distribution and Use
ERNST & YOUNG LLP
Singapore
C-4
Unaudited Pro Forma Combined Statement of Comprehensive Income
For the nancial year ended 31 December 2012
Note
Audited
Combined
Statement of
Comprehensive
Income
Pro Forma
Adjustments
Note 2 and
Note 3
Unaudited
Pro Forma
Combined
Statement of
Comprehensive
Income
$000 $000 $000
Revenue 4,897 4,897
Cost of sales (2,796) (2,796)
Gross prot 2,101 2,101
Other income 3,538 3,538
General and administrative costs (3,899) (3,899)
Finance costs (4) (4)
Prot before tax 1,509 1,509
Taxation (284) (284)
Prot for the year attributable to
owners of the Company 1,225 1,225
Foreign currency translation (918) (918)
Total comprehensive income for the year
attributable to owners of the Company 307 307
Earnings per share (cents)
Basic 6 0.17 0.17
Adjusted 6 0.15 0.15

The accompanying notes form an integral part of these unaudited pro forma combined nancial
information.
C-5
Unaudited Pro Forma Combined Statement of Comprehensive Income
Note
Unaudited
Combined
Statement of
Comprehensive
Income
Pro Forma
Adjustments
Note 2 and
Note 3
Unaudited
Pro Forma
Combined
Statement of
Comprehensive
Income
$000 $000 $000
Revenue 1,310 1,310
Cost of sales (865) (865)
Gross prot 445 445
Other revenue 8 8
General and administrative costs (1,105) (1,105)
Finance costs (10) (10)
Loss before tax (749) (749)
Taxation
Loss for the period attributable to owners of the
Company (749) (749)
Foreign currency translation 365 365
Total comprehensive loss for the period attributable
to owners of the Company (384) (384)
Loss per share (cents)
Basic 6 (0.11) (0.11)
Adjusted 6 (0.09) (0.09)
information.
C-6
Unaudited Pro Forma Combined Balance Sheet as at 31 December 2012
Note
Audited
Combined
Balance Sheet
Pro Forma
Adjustments
Note 2 and
Note 3
Unaudited
Pro Forma
Combined
Balance Sheet
$000 $000 $000
Non-current assets
33,188 33,188
Current assets
Stocks 2,907 2,907
Prepayments 492 492
10,401 12,588
Total assets 43,589 45,776
Current liabilities
Trade payables 1,306 1,306
Other payables 10,172 10,172
Amounts due to ultimate holding company 8 646 (646)
Interest-bearing bank loan 9 987 987
12,271 12,612
Net current liabilities (1,870) (24)
2,709 2,709
Net assets 28,609 30,455
Share capital 32,548 997 33,545
Reserves (3,939) 849 (3,090)
information.
C-7
Unaudited Pro Forma Combined Balance Sheet as at 31 March 2013
Note
Unaudited
Combined
Balance Sheet
Pro Forma
Adjustments
Note 2 and
Note 3
Unaudited
Pro Forma
Combined
Balance Sheet
$000 $000 $000
Non-current assets
32,888 32,888
Current assets
Stocks 3,275 3,275
Prepayments 487 487
9,547 9,547
Total assets 42,435 42,435
Current liabilities
Other payables 7,795 7,795
Amounts due to ultimate holding company 8
Interest-bearing bank loan 9 987 987
9,604 9,604
Net current liabilities (57) (57)
2,760 2,760
Net assets 30,071 30,071
Share capital 34,394 (849) 33,545
Reserves (4,323) 849 (3,474)
information.
C-8
Unaudited Pro Forma Combined Statement of Cash Flow
For the nancial year ended 31 December 2012
Audited
Combined
Statement of
Cash Flow
Pro Forma
Adjustments
Note 2 and
Note 3
Unaudited
Pro Forma
Combined
Statement of
Cash Flow
$000 $000 $000
Prot before tax 1,509 1,509
Adjustments for:
Gain on disposal of property, plant and equipment (2) (2)
Gain on relocation (3,471) (3,471)
Listing expenses 1,780 1,780
Operating prot before working capital changes 250 250
Increase in stocks (16) (16)
Decrease in payables (1,531) (1,531)
Cash used in operations (1,600) (1,600)
Net cash ows used in operating activities (1,591) (1,591)
Payment for mine properties (30) (30)
Payments made in advance:
land use rights (509) (509)
property, plant and equipment (45) (45)
Proceeds from disposal of property, plant and equipment 2 2
Compensation proceeds from government for relocation of
factory 3,519 3,519
Incidental costs in relation to relocation (479) (479)
information.
C-9
For the nancial year ended 31 December 2012 (contd)
Audited
Combined
Statement of
Cash Flow
Pro Forma
Adjustments
Note 2 and
Note 3
Unaudited
Pro Forma
Combined
Statement of
Cash Flow
$000 $000 $000
Proceeds from bank loan 987 987
Amount due to ultimate holding company (1,404) (646) (2,050)
Proceeds from issue of new shares 11,500 1,846 13,346
Payments incurred in relation to the initial public offering (1,281) (1,281)
Net cash ows generated from nancing activities 8,815 11,002
Net increase in cash and cash equivalents 1,467 3,654
Cash and cash equivalents at beginning of the year 3,047 3,047
Effects of exchange rate changes on cash and cash
equivalents 99 99
Cash and cash equivalents at end of the year (Note 7) 4,613 6,800
information.
C-10
Unaudited
Combined
Statement of
Cash Flow
Pro Forma
Adjustments
Note 2 and
Note 3
Unaudited
Pro Forma
Combined
Statement of
Cash Flow
$000 $000 $000
Loss before tax (749) (749)
Adjustments for:
Interest on bank loan 9 9
Loss on disposal of property, plant and equipment 1 1
Listing expenses 437 437
Operating prot before working capital changes (166) (166)
Increase in stocks (312) (312)
Decrease in payables (853) (853)
Cash used in operations (1,541) (1,541)
Interest paid (9) (9)
Net cash ows used in operating activities (1,549) (1,549)
information.
C-11
Unaudited
Combined
Statement of
Cash Flow
Pro Forma
Adjustments
Note 2 and
Note 3
Unaudited
Pro Forma
Combined
Statement of
Cash Flow
$000 $000 $000
Proceeds from bank loan 984 984
Proceeds from issue of new shares 1,200 1,200
Payments incurred in relation to the initial public offering (296) (296)
Net cash ows generated from nancing activities 1,888 1,888
Net decrease in cash and cash equivalents (1,419) (1,419)
Cash and cash equivalents at beginning of the period 4,613 4,613
Effects of exchange rate changes on cash and cash
equivalents (179) (179)
Cash and cash equivalents at end of the period (Note 7) 3,015 3,015
information.
C-12
Notes to the Unaudited Pro Forma Combined Financial Information
The unaudited pro forma combined nancial information should be read in conjunction with the Audited
Combined Financial Statements of AsiaPhos Limited (the Company) and its subsidiaries (collectively
the Group) for the nancial years ended 31 December 2010, 2011 and 2012 and the Unaudited Interim
Condensed Combined Financial Statements for the three months period ended 31 March 2013 which are
set out in Appendix A and B of the Offer Document respectively.
1. Corporate information
AsiaPhos Limited was incorporated in the Republic of Singapore on 3 January 2012 as a private
company limited by shares under the name of AsiaPhos Private Limited. On 6 September 2013,
the Company changed its name to AsiaPhos Limited in connection with its conversion to a public
company limited by shares. The Company was incorporated for the purpose of acquiring the
subsidiaries pursuant to the Restructuring Exercise as described in Note 2.
Road, #17-00, AIA Tower, Singapore 048542 and 600 North Bridge Road, Parkview Square #12-
01, Singapore 188778 respectively.
subsidiaries are that of exploration, mining and sale of phosphate rocks, and production and sale of
phosphorus and phosphate based chemical products.
The Group operates in Singapore and the Peoples Republic of China.
C-13
(contd)
as follows:
Note 2(d) below).
64,000,008 shares.
supplemental letters, (the Investment Agreements), with various parties (the Noteholders).
Noteholders.
from Eastcomm.
(i) On 21 January 2013, Norwest Chemicals issued 1,846,400 new shares to the ultimate
holding company, Eastcomm, via capitalisation of debt of $646,400 and for cash
consideration of $1,200,000.
(ii) On 1 February 2013, Mianzhu Norwest obtained a bank loan of RMB5 million (approximately
$987,000) from a bank in the PRC.
C-14
4. Basis of preparation of unaudited pro forma combined nancial information
The unaudited pro forma combined financial information has been prepared for illustrative
purposes only. It has been prepared to illustrate what:
(i) the nancial results and cash ows of the Group for the year ended 31 December 2012 and
three months period ended 31 March 2013 would have been if the signicant change to
the capital structure of the Company as disclosed in Note 2 and Note 3 had occurred on 1
January 2012; and
(ii) the nancial position of the Group would have been, as at 31 December 2012 and 31 March
2013 if the signicant change to the capital structure of the Company as disclosed in Note 2
and Note 3 had occurred on 31 December 2012 and 31 March 2013.
The unaudited pro forma combined nancial information has been prepared based on the audited
combined nancial statements of the Group for the nancial year ended 31 December 2012 and
unaudited interim condensed combined nancial statements for the three months period ended 31
March 2013 which were prepared in accordance with the Singapore Financial Reporting Standards.
The audited combined nancial statements of the Group for the nancial year ended 31 December
2012 and unaudited interim combined nancial statements for the three months period ended 31
March 2013 were audited and reviewed, respectively, by Ernst & Young LLP Singapore, Public
Accountants and Chartered Accountants.
The auditors report on the above nancial statements was not subject to any qualication,
modication or disclaimer.
The objective of the unaudited pro forma combined nancial information is to show what the
historical information might have been had the transaction above taken place on the respective
dates. However, the unaudited pro forma combined nancial information of the Group, by its
nature, may not give a true picture of the Groups actual nancial position and results and is not
necessarily indicative of the results of the operations or the related effects on the nancial position
that would have been attained had the above mentioned existed earlier.
5. Signicant accounting policies
The unaudited pro forma combined nancial information is prepared using the same accounting
policies as the audited combined nancial statements of the Group as disclosed in Note 3 to the
Audited Combined Financial Statements of AsiaPhos Limited and its subsidiaries for the nancial
years ended 31 December 2010, 2011 and 2012 and Unaudited Interim Condensed Combined
Financial Statements for the three months period ended 31 March 2013.
C-15
6. Earnings/(loss) per share
For illustrative purposes, basic earnings per share are calculated by dividing the Groups prot/
(loss) for the year/period attributable to owners of the Company by the pre-offering share capital of
For illustrative purposes, adjusted (loss)/earnings per share is calculated by dividing the Groups
(loss)/prot for the year/period attributable to owners of the Company by the post-invitation share
capital of 800,000,000 ordinary shares.
Cash and bank balances were adjusted to include the cash proceeds from the capital injection of
$1,200,000 and drawdown of loan as disclosed in Note 3.
Cash and bank balances included in the pro forma combined statements of cash ow comprise:
Unaudited Pro
Forma
31 December
2012
Unaudited Pro
Forma
31 March
2013
$000 $000
Less: Pledged deposits held for mine activities (159) (162)
Amounts due to ultimate holding company were adjusted to reect the capitalisation of debt to
share capital as disclosed in Note 3.
9. Interest-bearing bank loan
Interest-bearing bank loan arose to reect the drawdown of loan as disclosed in Note 3.
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10. Capital management
The Group manages its capital structure and makes adjustments to it, in light of changes in
economic conditions. To maintain or adjust the capital structure, the Group may adjust the dividend
payment to shareholders, return capital to shareholders or issue new shares.
The Group monitors capital using a gearing ratio, which is net debt divided by total capital plus net
debt. The Group includes within net debt, trade and other payables, advances from customers,
amounts due to ultimate holding company, interest-bearing bank loan less cash and bank balances.
Capital includes ordinary shares and reserves.
As at 31 December 2012, the Groups gearing ratio is 20.8%. The gearing ratio was adjusted to
15.7% and 17.6% for 31 December 2012 and 31 March 2013 respectively to reect the signicant
change in capital structure as disclosed in Note 2 and Note 3.
2012
Unaudited
Pro Forma
31 December
2012
Unaudited
Pro Forma
31 March
2013
$000 $000 $000
Trade payables 1,306 1,306 797
Other payables 10,172 10,172 7,795
Amounts due to ultimate holding company 646
Interest-bearing bank loan 987 987
Less: Cash and bank balances (4,772) (6,959) (3,177)
Net debt 7,499 5,653 6,427
Total capital 28,609 30,455 30,071
Capital and net debt 36,108 36,108 36,498
Gearing ratio 20.8% 15.7% 17.6%
D-1
APPENDIX D: SUMMARY OF MEMORANDUM AND ARTICLES OF ASSOCIATION
OF OUR COMPANY
The discussion below provides information about certain provisions of our Memorandum and Articles of
Association and the laws of Singapore. This description is only a summary and is qualied by reference
to Singapore law and our Articles.
The instruments that constitute and define our Company are the Memorandum and Articles of
Association of the Company.
Memorandum of Association
The registration number with which our Company was incorporated is 201200335G. Our Memorandum
of Association states that the liability of our Shareholders is limited to the amount, if any, for the time
being unpaid on the shares respectively held by them. Our Memorandum of Association also sets out the
objects for which our Company was formed, including acting as a holding and investment company, and
the powers of our Company.
Articles of Association
The provisions in the Articles of Association of our Company relating to:
(a) a Directors power to vote on a proposal, arrangement or contract in which the Director is interested
Article 99
A Director shall not vote in respect of any contract or arrangement or any other proposal
whatsoever in which he has any personal material interest, directly or indirectly. A Director shall not
be counted in the quorum at a meeting in relation to any resolution on which he is debarred from
voting.
(b) the Directors power to vote on remuneration (including pension or other benets) for himself or
for any other Director, and whether the quorum at an meeting of the board of Directors to vote on
Directors remuneration may include the Director whose remuneration is the subject of the vote
Article 76
The ordinary remuneration of the Directors, which shall from time to time be determined by an
Ordinary Resolution of the Company, shall not be increased except pursuant to an Ordinary
Resolution passed at a General Meeting where notice of the proposed increase shall have been
given in the notice convening the General Meeting and shall (unless such resolution otherwise
provides) be divisible among the Directors as they may agree, or failing agreement, equally,
except that any Director who shall hold ofce for part only of the period in respect of which
such remuneration is payable shall be entitled only to rank in such division for a proportion of
remuneration related to the period during which he has held ofce. The ordinary remuneration of an
executive Director may not include a commission on or a percentage of turnover and the ordinary
remuneration of a non-executive Director shall be a xed sum, and not by a commission on or a
percentage of prots or turnover.

Article 77
Any Director who holds any executive ofce, or who serves on any committee of the Directors, or
who otherwise performs services which in the opinion of the Directors are outside the scope of the
ordinary duties of a Director, may be paid such extra remuneration by way of salary, commission
or otherwise as the Directors may determine, Provided that such extra remuneration (in case of an
executive Director) shall not be by way of commission on or a percentage of turnover and (in the
case of a Director other than an executive Director) shall be a xed sum, and not by a commission
on or a percentage of prots or turnover.
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OF OUR COMPANY
Article 78
The Directors may repay to any Director all such reasonable expenses as he may incur in
attending and returning from meetings of the Directors or of any committee of the Directors or
General Meetings or otherwise in or about the business of the Company.
Article 79
The Directors shall have power to pay and agree to pay pensions or other retirement,
superannuation, death or disability benets to (or to any person in respect of) any Director for the
time being holding any executive ofce and for the purpose of providing any such pensions or other
benets to contribute to any scheme or to pay premiums.
(c) borrowing powers exercisable by the Directors and how such borrowing powers can be varied
Article 107
Subject as hereinafter provided and to the provisions of the Statutes, the Directors may exercise
all the powers of the Company to borrow money, to mortgage or charge its undertaking, property
and uncalled capital and to issue debentures and other securities, whether outright or as collateral
security for any debt, liability or obligation of the Company or of any third party.
(d) retirement or non-retirement of Directors under an age limit requirement
Article 88
At each Annual General Meeting, one-third of the Directors for the time being (or, if their number
is not a multiple of three, the number nearest to but not less than one-third) shall retire from ofce
by rotation, Provided that no Director holding ofce as Managing Director shall be subject to
retirement by rotation or be taken into account in determining the number of Directors to retire. For
the avoidance of doubt, each Director (other than a Director holding ofce as Managing Director)
shall retire at least once every three years.
Article 89
The Directors to retire by rotation shall include (so far as necessary to obtain the number required)
any Director who is due to retire at a General Meeting by reason of age or who wishes to retire
and not to offer himself for re-election. Any further Directors so to retire shall be those of the
other Directors subject to retirement by rotation who have been longest in ofce since their last
re-election or appointment and so that as between persons who became or were last re-elected
Directors on the same day, those to retire shall (unless they otherwise agree among themselves)
be determined by ballot. A retiring Director shall be eligible for re-election.
Article 90
The Company at a General Meeting at which a Director retires under any provision of these
Articles may by Ordinary Resolution ll the ofce being vacated by electing thereto the retiring
Director or some other person eligible for appointment. In default, the retiring Director shall be
deemed to have been re-elected except in any of the following cases:
(a) where at such meeting it is expressly resolved not to ll such ofce or a resolution for the re-
election of such Director is put to the meeting and lost; or
(b) where such Director has given notice in writing to the Company that he is unwilling to be re-
elected; or
(c) where the default is due to the moving of a resolution in contravention of the next following
Article; or
(d) where such Director has attained any retiring age applicable to him as Director.
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OF OUR COMPANY
The retirement shall not have effect until the conclusion of the meeting except where a resolution
is passed to elect some other person in the place of the retiring Director or a resolution for his
re-election is put to the meeting and lost and accordingly a retiring Director who is re-elected or
deemed to have been re-elected will continue in ofce without a break.
(e) the number of shares, if any, required for Directors qualication
Article 75
A Director shall not be required to hold any shares of the Company by way of qualication. A
Director who is not a Member of the Company shall nevertheless be entitled to receive notice of
and to attend and speak at General Meetings.
(f) rights, preferences and restrictions attaching to each class of shares
Article 3
(A) Subject to the Act and to these Articles, no shares may be issued by the Directors without
the prior approval of the Company in General Meeting pursuant to Section 161 of the Act or
except as permitted under the rules of the Designated Stock Exchange, but subject thereto
and the terms of such approval, and to Article 5, and to any special rights attached to any
shares for the time being issued, the Directors may allot and issue shares or grant options
over or otherwise dispose of the same to such persons on such terms and conditions
and for such consideration and at such time and whether or not subject to the payment
of any part of the amount thereof in cash or otherwise as the Directors may think t, and
any shares may, subject to compliance with Sections 70 and 75 of the Act, be issued with
such preferential, deferred, qualied or special rights, privileges, conditions or restrictions,
whether as regards Dividend, return of capital, participation in surplus assets and prots,
voting, conversion or otherwise, as the Directors may think t, and preference shares may
be issued which are or at the option of the Company are liable to be redeemed, the terms
and manner of redemption being determined by the Directors in accordance with the Act,
Provided Always that no options shall be granted over unissued shares except in accordance
with the Act and the Designated Stock Exchanges listing rules.
(B) The Directors may, at any time after the allotment of any share but before any person has
been entered in the Register of Members as the holder, recognise a renunciation thereof by
the allottee in favour of some other person and may accord to any allottee of a share a right
to effect such renunciation upon and subject to such terms and conditions as the Directors
may think t to impose.
(C) Except so far as otherwise provided by the conditions of issue or by these Articles, all new
shares shall be issued subject to the provisions of the Statutes and of these Articles with
reference to allotment, payment of calls, lien, transfer, transmission, forfeiture or otherwise.
Article 8
(A) In the event of preference shares being issued, the total number of issued preference shares
shall not at any time exceed the total number of the issued ordinary shares. Preference
shareholders shall have the same rights as ordinary shareholders as regards receiving of
notices, reports and balance-sheets and attending General Meetings of the Company, and
preference shareholders shall also have the right to vote at any General Meeting convened
for the purpose of reducing capital or winding-up or sanctioning a sale of the undertaking of
the Company or where the proposal to be submitted to the General Meeting directly affects
their rights and privileges or when the Dividend on the preference shares is more than six
months in arrear.
(B) The Company has power to issue further preference capital ranking equally with, or in
priority to, preference shares already issued.
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OF OUR COMPANY
Article 9
(A) Whenever the share capital of the Company is divided into different classes of shares,
the variation or abrogation of the special rights attached to any class may, subject to the
provisions of the Act, be made either with the consent in writing of the holders of three-
quarters of the total number of the issued shares of the class or with the sanction of a
Special Resolution passed at a separate General Meeting of the holders of the shares of the
class (but not otherwise) and may be so made either whilst the Company is a going concern
or during or in contemplation of a winding-up. To every such separate General Meeting all
the provisions of these Articles relating to General Meetings of the Company and to the
proceedings thereat shall mutatis mutandis apply, except that the necessary quorum shall
be two or more persons holding at least one-third of the total number of the issued shares
of the class present in person or by proxy or attorney and that every such holder shall have
one vote for every share of the class held by him where the class is a class of equity shares
within the meaning of Section 64(1) of the Act or at least one vote for every share of the
class where the class is a class of preference shares within the meaning of Section 180(2)
of the Act, Provided Always that where the necessary majority for such a Special Resolution
is not obtained at such General Meeting, the consent in writing, if obtained from the holders
of three-quarters of the total number of the issued shares of the class concerned within two
months of such General Meeting, shall be as valid and effectual as a Special Resolution
carried at such General Meeting.
(B) The provisions in Article 9(A) shall mutatis mutandis apply to any repayment of preference
capital (other than redeemable preference capital) and any variation or abrogation of the
rights attached to preference shares or any class thereof.
(C) The special rights attached to any class of shares having preferential rights shall not unless
otherwise expressly provided by the terms of issue thereof be deemed to be varied by the
creation or issue of further shares ranking as regards participation in the prots or assets
of the Company in some or all respects pari passu therewith but in no respect in priority
thereto.
Article 14
Every person whose name is entered as a Member in the Register of Members shall be entitled,
within ten market days (or such period as the Directors may determine having regard to any
limitation thereof as may be prescribed by the Designated Stock Exchange from time to time) after
the closing date of any application for shares or (as the case may be) the date of lodgment of a
registrable transfer, to one certicate for all his shares of any one class or to several certicates in
reasonable denominations each for a part of the shares so allotted or transferred.
Article 34
(A) There shall be no restriction on the transfer of fully paid up shares (except where required
by law or by the rules, bye-laws or listing rules of the Designated Stock Exchange) but the
Directors may in their discretion decline to register any transfer of shares upon which the
Company has a lien, and in the case of shares not fully paid up, may refuse to register a
transfer to a transferee of whom they do not approve, Provided Always that in the event of
the Directors refusing to register a transfer of shares, the Company shall within ten market
days (or such period as the Directors may determine having regard to any limitation thereof
as may be prescribed by the Designated Stock Exchange from time to time) after the date
on which the application for a transfer of shares was made, serve a notice in writing to the
applicant stating the facts which are considered to justify the refusal as required by the
Statutes.
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OF OUR COMPANY
(B) The Directors may decline to register any instrument of transfer unless:
(a) such fee not exceeding $2.00 (or such other fee as the Directors may determine
having regard to any limitation thereof as may be prescribed by the Act and the
Designated Stock Exchange from time to time) as the Directors may from time to time
require is paid to the Company in respect thereof;
(b) the amount of proper duty (if any) with which each instrument of transfer is chargeable
under any law for the time being in force relating to stamps is paid;
(c) the instrument of transfer is deposited at the Ofce or at such other place (if any) as
the Directors may appoint accompanied by a certicate of payment of stamp duty (if
stamp duty is payable on such instrument of transfer in accordance with any law for
the time being in force relating to stamp duty), the certicates of the shares to which it
relates, and such other evidence as the Directors may reasonably require to show the
right of the transferor to make the transfer and, if the instrument of transfer is executed
by some other person on his behalf, the authority of the person so to do; and
(d) the instrument of transfer is in respect of only one class of shares.
Article 41
A reference to a Member shall be a reference to a registered holder of shares in the Company, or
where such registered holder is the CDP, the Depositors on behalf of whom CDP holds the shares,
Provided that:
(a) a Depositor shall only be entitled to attend any General Meeting and to speak and vote
thereat if his name appears on the Depository Register maintained by the CDP forty-eight
(48) hours before the General Meeting as a Depositor on whose behalf the CDP holds
shares in the Company, the Company being entitled to deem each such Depositor, or
each proxy of a Depositor who is to represent the entire balance standing to the Securities
Account of the Depositor, to represent such number of shares as is actually credited to
the Securities Account of the Depositor as at such time, according to the records of the
CDP as supplied by the CDP to the Company, and where a Depositor has apportioned
the balance standing to his Securities Account between two proxies, to apportion the said
number of shares between the two proxies in the same proportion as previously specied
by the Depositor in appointing the proxies; and accordingly no instrument appointing a proxy
of a Depositor shall be rendered invalid merely by reason of any discrepancy between the
proportion of Depositors shareholding specied in the instrument of proxy, or where the
balance standing to a Depositors Securities Account has been apportioned between two
proxies the aggregate of the proportions of the Depositors shareholding they are specied
to represent, and the true balance standing to the Securities Account of a Depositor as at
the time of the General Meeting, if the instrument is dealt with in such manner as is provided
above;
(b) the payment by the Company to the CDP of any Dividend payable to a Depositor shall to
the extent of the payment discharge the Company from any further liability in respect of the
payment;
(c) the delivery by the Company to the CDP of provisional allotments or share certicates in
respect of the aggregate entitlements of Depositors to new shares offered by way of rights
issue or other preferential offering or bonus issue shall to the extent of the delivery discharge
the Company from any further liability to each such Depositor in respect of his individual
entitlement; and
(d) the provisions in these Articles relating to the transfers, transmissions or certication of
shares shall not apply to the transfer of book-entry securities (as dened in the Statutes).
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OF OUR COMPANY
Article 42
Except as required by the Statutes or law, no person shall be recognised by the Company as
holding any share upon any trust, and the Company shall not be bound by or compelled in any way
to recognise (even when having notice thereof) any equitable, contingent, future or partial interest
in any share, or any interest in any fractional part of a share, or (except only as by these Articles
or by the Statutes or law otherwise provided) any other right in respect of any share, except an
absolute right to the entirety thereof in the registered holder and nothing in these Articles contained
relating to the CDP or to Depositors or in any depository agreement made by the Company with
any common depository for shares shall in any circumstances be deemed to limit, restrict or qualify
the above.
Article 62
In the case of joint holders of a share, the vote of the senior who tenders a vote, whether in person
or by proxy, shall be accepted to the exclusion of the votes of the other joint holders and for this
purpose seniority shall be determined by the order in which the names stand in the Register of
Members or, as the case may be, the order in which the names appear in the Depository Register
in respect of the joint holding.
Article 63
Where in Singapore or elsewhere a receiver or other person (by whatever name called) has
been appointed by any court claiming jurisdiction in that behalf to exercise powers with respect
to the property or affairs of any Member on the ground (however formulated) of mental disorder,
the Directors may in their absolute discretion, upon or subject to production of such evidence of
the appointment as the Directors may require, permit such receiver or other person on behalf of
such Member, to vote in person or by proxy at any General Meeting, or to exercise any other right
conferred by Membership in relation to General Meetings.
Article 64
No Member shall be entitled in respect of shares held by him to vote at a General Meeting either
personally or by proxy or to exercise any other right conferred by membership in relation to General
Meetings if any call or other sum payable by him to the Company in respect of such shares
remains unpaid.
(g) any change in capital
Article 10
The Company may by Ordinary Resolution:
(a) consolidate and divide all or any of its share capital;
(b) sub-divide its shares, or any of them, provided always that in such subdivision the proportion
between the amount paid and the amount (if any) unpaid on each reduced share shall be
same as it was in the case of the share from which the reduced share is derived;
(c) convert or exchange any class of shares into or for any other class of shares; and/ or
(d) cancel the number of shares which at the date of the passing of the resolution in that behalf
have not been taken or agreed to be taken by any person or which have been forfeited and
diminish the amount of its share capital by the number of the shares so cancelled.
Article 11
(A) The Company may reduce its share capital or any other undistributable reserve in any
manner permitted, and with, and subject to, any incident authorised, and consent or
conrmation required, by law.
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OF OUR COMPANY
(B) The Company may purchase or otherwise acquire its issued shares subject to and in
accordance with the provisions of the Statutes and any applicable rules of the Designated
Stock Exchange (hereafter, the Relevant Laws), on such terms and subject to such
conditions as the Company may in General Meeting prescribe in accordance with the
Relevant Laws. Any shares purchased or acquired by the Company as aforesaid shall,
unless held in treasury in accordance with the Act, be deemed to be cancelled immediately
on purchase or acquisition by the Company. On the cancellation of any share as aforesaid,
the rights and privileges attached to that share shall expire. In any other instance, the
Company may hold or deal with any such share which is so purchased or acquired by it in
such manner as may be permitted by, and in accordance with the Relevant Laws. Without
prejudice to the generality of the foregoing, upon cancellation of any share purchased or
otherwise acquired by the Company pursuant to these Articles and the Statutes, the number
of issued shares of the Company shall be diminished by the number of shares so cancelled,
and, where any such cancelled share was purchased or acquired out of the capital of the
Company, the amount of share capital of the Company shall be reduced accordingly.
(h) any change in the respective rights of the various classes of shares including the action necessary
to change the rights
Article 9
(A) Whenever the share capital of the Company is divided into different classes of shares,
the variation or abrogation of the special rights attached to any class may, subject to the
provisions of the Act, be made either with the consent in writing of the holders of three-
quarters of the total number of the issued shares of the class or with the sanction of a
Special Resolution passed at a separate General Meeting of the holders of the shares of the
class (but not otherwise) and may be so made either whilst the Company is a going concern
or during or in contemplation of a winding-up. To every such separate General Meeting all
the provisions of these Articles relating to General Meetings of the Company and to the
proceedings thereat shall mutatis mutandis apply, except that the necessary quorum shall
be two or more persons holding at least one-third of the total number of the issued shares
of the class present in person or by proxy or attorney and that every such holder shall have
one vote for every share of the class held by him where the class is a class of equity shares
within the meaning of Section 64(1) of the Act or at least one vote for every share of the
class where the class is a class of preference shares within the meaning of Section 180(2)
of the Act, Provided Always that where the necessary majority for such a Special Resolution
is not obtained at such General Meeting, the consent in writing, if obtained from the holders
of three-quarters of the total number of the issued shares of the class concerned within two
months of such General Meeting, shall be as valid and effectual as a Special Resolution
carried at such General Meeting.
(B) The provisions in Article 9(A) shall mutatis mutandis apply to any repayment of preference
capital (other than redeemable preference capital) and any variation or abrogation of the
rights attached to preference shares or any class thereof.
(C) The special rights attached to any class of shares having preferential rights shall not unless
otherwise expressly provided by the terms of issue thereof be deemed to be varied by the
creation or issue of further shares ranking as regards participation in the prots or assets
of the Company in some or all respects pari passu therewith but in no respect in priority
thereto.
(i) dividends and distribution
Article 122
Subject to the Act, the Company may by Ordinary Resolution declare Dividends but no such
Dividend shall exceed the amount recommended by the Directors.
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OF OUR COMPANY
Article 123
If and so far as in the opinion of the Directors, the prots of the Company justify such payments,
the Directors may declare and pay the xed Dividends on any class of shares carrying a xed
Dividend expressed to be payable on xed dates on the half-yearly or other dates prescribed for
the payment thereof and may also from time to time declare and pay interim Dividends on shares
of any class of such amounts and on such dates and in respect of such periods as they think t.
Article 124
Subject to any rights or restrictions attached to any shares or class of shares and except as
otherwise permitted under the Act:
(a) all Dividends in respect of shares must be paid in proportion to the number of shares held by
a Member otherwise than in advance of calls, but where shares are partly paid, all Dividends
must be apportioned and paid proportionately to the amounts paid or credited as paid on the
partly paid shares; and
(b) all Dividends must be apportioned and paid proportionately to the amounts so paid or
credited as paid during any portion or portions of the period in respect of which the Dividend
is paid.
For the purposes of this Article, an amount paid or credited as paid on a share in advance of
a call is to be ignored.
Article 125
(A) No Dividend shall be paid otherwise than out of prots available for distribution under the
provisions of the Statutes. The payment by the Directors of any unclaimed dividends or other
moneys payable on or in respect of a share into a separate account shall not constitute the
Company a trustee in respect thereof. All Dividends remaining unclaimed after one year from
having been rst payable may be invested or otherwise made use of by the Directors for the
benet of the Company, and any Dividend or any such moneys unclaimed after six (6) years
from having been rst payable shall be forfeited and shall revert to the Company provided
always that the Directors may at any time thereafter at their absolute discretion annul any
such forfeiture and pay the Dividend so forfeited to the person entitled thereto prior to the
forfeiture. If the CDP returns any such Dividend or moneys to the Company, the relevant
Depositor shall not have any right or claim in respect of such Dividend or moneys against
the Company if a period of six years has elapsed from the date of the declaration of such
Dividend or the date on which such other moneys are rst payable.
(B) A payment by the Company to the CDP of any Dividend or other moneys payable to a
Depositor shall, to the extent of the payment made, discharge the Company from any liability
to the Depositor in respect of that payment.
Article 126
No Dividend or other monies payable on or in respect of a share shall bear interest as against the
Company.
Article 127
(A) The Directors may retain any Dividend or other monies payable on or in respect of a share
on which the Company has a lien and may apply the same in or towards satisfaction of the
debts, liabilities or engagements in respect of which the lien exists.
(B) The Directors may retain the Dividends payable upon shares in respect of which any person
is under the provisions as to the transmission of shares hereinbefore contained entitled to
become a Member, or which any person is under those provisions entitled to transfer, until
such person shall become a Member in respect of such shares or shall transfer the same.
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OF OUR COMPANY
Article 128
The waiver in whole or in part of any Dividend on any share by any document (whether or not
under seal) shall be effective only if such document is signed by the Member (or the person
entitled to the share in consequence of the death or bankruptcy of the holder) and delivered to the
Company and if or to the extent that the same is accepted as such or acted upon by the Company.
Article 129
Subject to the provisions of the Act, the Company may upon the recommendation of the Directors
by Ordinary Resolution direct payment of a Dividend in whole or in part by the distribution of
specic assets (and in particular of paid-up shares or debentures of any other company) and
the Directors shall give effect to such resolution. Where any difculty arises with regard to such
distribution, the Directors may settle the same as they think expedient and in particular, may issue
fractional certicates, may x the value for distribution of such specic assets or any part thereof,
may determine that cash payments shall be made to any Member upon the footing of the value so
xed in order to adjust the rights of all parties and may vest any such specic assets in trustees as
may seem expedient to the Directors.
Article 130
Any Dividend or other moneys payable in cash on or in respect of a share may be paid by cheque
or warrant sent through the post to the registered address appearing in the Register of Members
or (as the case may be) the Depository Register of the Member or person entitled thereto (or, if
two or more persons are registered in the Register of Members or (as the case may be) entered in
the Depository Register as joint holders of the share or are entitled thereto in consequence of the
death or bankruptcy of the holder, to any one of such persons) or to such person and such address
as such Member or person or persons may by writing direct. Every such cheque or warrant shall be
made payable to the order of the person to whom it is sent or to such person as the holder or joint
holders or person or persons entitled to the share in consequence of the death or bankruptcy of
the holder may direct and payment of the cheque or warrant by the banker upon whom it is drawn
shall be a good discharge to the Company. Every such cheque or warrant shall be sent at the risk
of the person entitled to the money represented thereby.
Article 131
If two or more persons are registered in the Register of Members or (as the case may be) the
Depository Register as joint holders of any share, or are entitled jointly to a share in consequence
of the death or bankruptcy of the holder, any one of them may give effectual receipts for any
Dividend or other moneys payable or property distributable on or in respect of the share.
Article 132
Any resolution declaring a Dividend on shares of any class, whether a resolution of the Company
in General Meeting or a resolution of the Directors, may specify that the same shall be payable to
the persons registered as the holders of such shares in the Register of Members or (as the case
may be) the Depository Register at the close of business on a particular date and thereupon the
Dividend shall be payable to them in accordance with their respective holdings so registered, but
without prejudice to the rights inter se in respect of such Dividend of transferors and transferees of
any such shares.
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OF OUR COMPANY
(j) any limitation on the right to own Shares, including limitations on the right of non-resident or foreign
Shareholders to hold or exercise voting rights on their Shares
Article 5
(A) Subject to any direction to the contrary that may be given by the Company in General
Meeting or except as permitted by the rules of the Designated Stock Exchange, all new
shares shall before issue be offered to such persons who as at the date (as determined
by the Directors) of the offer are entitled to receive notices from the Company of General
Meetings in proportion, as far as the circumstances admit, to the number of the existing
shares to which they are entitled. The offer shall be made by notice specifying the number
of shares offered, and limiting a time within which the offer, if not accepted, will be deemed
to be declined, and, after the expiration of that time, or on the receipt of an intimation from
the person to whom the offer is made that he declines to accept the shares offered, the
Directors may dispose of those shares in such manner as they think most benecial to the
Company. The Directors may likewise so dispose of any new shares which (by reason of the
ratio which the new shares bear to shares held by persons entitled to an offer of new shares)
cannot, in the opinion of the Directors, be conveniently offered under this Article 5(A).
(B) Notwithstanding Article 5(A) above, the Company may by Ordinary Resolution in General
Meeting give to the Directors a general authority, either unconditionally or subject to such
conditions as may be specied in the Ordinary Resolution, to:
(a) (i) issue shares in the capital of the Company (shares) whether by way of rights,
bonus or otherwise; and/ or
(ii) make or grant offers, agreements or options (collectively, Instruments) that
might or would require shares to be issued, including but not limited to the
creation and issue of (as well as adjustments to) warrants, debentures or other
instruments convertible into shares; and
(b) (notwithstanding the authority conferred by the Ordinary Resolution may have ceased
to be in force) issue shares in pursuance of any Instrument made or granted by the
Directors while the Ordinary Resolution was in force,
Provided that:
(1) the aggregate number of shares to be issued pursuant to the Ordinary Resolution
(including shares to be issued in pursuance of Instruments made or granted pursuant
to the Ordinary Resolution) shall be subject to such limits and manner of calculation
as may be prescribed by the Designated Stock Exchange;
(2) in exercising the authority conferred by the Ordinary Resolution, the Company shall
comply with the provisions of the listing rules of the Designated Stock Exchange for
the time being in force (unless such compliance is waived by the Designated Stock
Exchange) and these Articles; and
(3) (unless revoked or varied by the Company in General Meeting) the authority conferred
by the Ordinary Resolution shall not continue in force beyond the conclusion of the
Annual General Meeting of the Company next following the passing of the Ordinary
Resolution, or the date by which such Annual General Meeting of the Company is
required by law to be held, or the expiration of such other period as may be prescribed
by the Act (whichever is the earliest).
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OF OUR COMPANY
(C) The Company may, notwithstanding Articles 5(A) and 5(B) above, authorise the Directors not
to offer new shares to Members to whom by reason of foreign securities laws, such offers
may not be made without registration of the shares or a prospectus or other document, but
to sell the entitlements to the new shares on behalf of such Members on such terms and
conditions as the Company may direct.
Article 34
(A) There shall be no restriction on the transfer of fully paid up shares (except where required
by law or by the rules, bye-laws or listing rules of the Designated Stock Exchange) but the
Directors may in their discretion decline to register any transfer of shares upon which the
Company has a lien, and in the case of shares not fully paid up, may refuse to register a
transfer to a transferee of whom they do not approve, Provided Always that in the event of
the Directors refusing to register a transfer of shares, the Company shall within ten market
days (or such period as the Directors may determine having regard to any limitation thereof
as may be prescribed by the Designated Stock Exchange from time to time) after the date
on which the application for a transfer of shares was made, serve a notice in writing to the
applicant stating the facts which are considered to justify the refusal as required by the
Statutes.
(B) The Directors may decline to register any instrument of transfer unless:
(a) such fee not exceeding $2.00 (or such other fee as the Directors may determine
having regard to any limitation thereof as may be prescribed by the Act and the
Designated Stock Exchange from time to time) as the Directors may from time to time
require is paid to the Company in respect thereof;
(b) the amount of proper duty (if any) with which each instrument of transfer is chargeable
under any law for the time being in force relating to stamps is paid;
(c) the instrument of transfer is deposited at the Ofce or at such other place (if any) as
the Directors may appoint accompanied by a certicate of payment of stamp duty (if
stamp duty is payable on such instrument of transfer in accordance with any law for
the time being in force relating to stamp duty), the certicates of the shares to which it
relates, and such other evidence as the Directors may reasonably require to show the
right of the transferor to make the transfer and, if the instrument of transfer is executed
by some other person on his behalf, the authority of the person so to do; and
(d) the instrument of transfer is in respect of only one class of shares.
Article 42
Except as required by the Statutes or law, no person shall be recognised by the Company as
holding any share upon any trust, and the Company shall not be bound by or compelled in any way
to recognise (even when having notice thereof) any equitable, contingent, future or partial interest
in any share, or any interest in any fractional part of a share, or (except only as by these Articles
or by the Statutes or law otherwise provided) any other right in respect of any share, except an
absolute right to the entirety thereof in the registered holder and nothing in these Articles contained
relating to the CDP or to Depositors or in any depository agreement made by the Company with
any common depository for shares shall in any circumstances be deemed to limit, restrict or qualify
the above.
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APPENDIX E: DESCRIPTION OF OUR SHARES
The following statements are brief summaries of the rights and privileges of Shareholders conferred by
the laws of Singapore and the Articles of Association (the Articles) of the Company.
These statements summarise the material provisions of the Articles but are qualied in entirety by
reference to the Articles.
ORDINARY SHARES
All of the ordinary shares of the Company (the Shares) are in registered form. The Company may,
subject to the provisions of the Companies Act and the rules of the SGX-ST, purchase its own Shares.
However, it may not, except in circumstances permitted by the Companies Act, grant any nancial
assistance for the acquisition or proposed acquisition of its own Shares.
NEW ORDINARY SHARES
New ordinary Shares may only be issued with the prior approval in a general meeting of the shareholders
of the Company. The aggregate number of Shares to be issued pursuant to such approval may not
exceed one hundred per cent. (100%) (or such other limit as may be prescribed by the SGX-ST) of its
issued share capital at the time of grant of such approval for the time being, of which the aggregate
number of shares to be issued other than on a pro rata basis to its shareholders may not exceed fty
per cent. (50%) (or such other limit as may be prescribed by the SGX-ST) of its share capital at the time
of grant of such approval for the time being. The approval, if granted, will lapse at the conclusion of the
annual general meeting following the date on which the approval was granted. Subject to the foregoing,
the provisions of the Companies Act and any special rights attached to any class of shares currently
issued, all new Shares are under the control of the board of Directors of the Company (the Board of
Directors) who may allot and issue the same with such rights and restrictions as it may think t.
SHAREHOLDERS
Only persons who are registered in the register of Shareholders of the Company and, in cases in
which the person so registered is The Central Depository (Pte) Limited (the CDP) the persons named
as the depositors in the depository register maintained by the CDP for the Shares, are recognised as
Shareholders of the Company. The Company will not, except as required by law, recognise any equitable,
contingent, future or partial interest in any ordinary share or other rights for any ordinary share other than
the absolute right thereto of the registered holder of that Share or of the person whose name is entered
in the depository register for that Share. The Company may close the register of Shareholders for any
time or times if it provides the Accounting and Corporate Regulatory Authority of Singapore at least 14
days notice and the SGX-ST at least ten (10) clear market days notice. However, the register may not
be closed for more than 30 days in aggregate in any calendar year. The Company typically closes the
register to determine Shareholders entitlement to receive dividends and other distributions.
TRANSFER OF ORDINARY SHARES
There is no restriction on the transfer of fully paid ordinary shares except where required by law or the
Invitation rules or the rules or by-laws of any stock exchange on which the Company is listed. The Board
of Directors may decline to register any transfer of Shares which are not fully paid shares or Shares on
which the Company has a lien. Shares may be transferred by a duly signed instrument of transfer in a
form approved by any stock exchange on which the Company is listed. The Board of Directors may also
decline to register any instrument of transfer unless, inter alia, it has been duly stamped and is presented
for registration together with the share certicate and such other evidence of title as they may require.
The Company will replace lost or destroyed certicates for ordinary shares if it is properly notied and if
the applicant pays a fee which will not exceed $2.00 and furnishes any evidence and indemnity that the
Board of Directors may require.
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GENERAL MEETINGS OF SHAREHOLDERS
The Company is required to hold an annual general meeting every year. The Board may convene an
extraordinary general meeting whenever it thinks t and must do so if Shareholders representing not
less than ten per cent. (10%) of the total voting rights of all Shareholders request in writing that such
a meeting be held. In addition, two (2) or more Shareholders holding not less than ten per cent. (10%)
of the issued share capital of the Company may call a meeting. Unless otherwise required by law or
by the Articles, voting at general meetings is by ordinary resolution, requiring an afrmative vote of a
simple majority of the votes cast at that meeting. An ordinary resolution sufces, for example, for the
appointment of Directors. A special resolution, requiring the afrmative vote of at least seventy-ve per
cent. (75%) of the votes cast at the meeting, is necessary for certain matters under Singapore law,
including voluntary winding up, amendments to the Memorandum of Association and the Articles, a
change of the corporate name and a reduction in the share capital, share premium account or capital
redemption reserve fund. The Company must give at least 21 days notice in writing for every general
meeting convened for the purpose of passing a special resolution. Ordinary resolutions generally require
at least 14 days notice in writing. The notice must be given to every shareholder who has supplied the
Company with an address in Singapore for the giving of notices and must set forth the place, the day and
the hour of the meeting and, in the case of special business, the general nature of that business.
VOTING RIGHTS
A Shareholder is entitled to attend, speak and vote at any general meeting, in person or by proxy. Proxies
need not be a Shareholder. A person who holds Shares through the SGX-ST book-entry settlement
system will only be entitled to vote at a general meeting as a Shareholder if his name appears on the
depository register maintained by the CDP 48 hours before the general meeting. Except as otherwise
provided in the Articles, two (2) or more shareholders must be present in person or by proxy to constitute
a quorum at any general meeting. Every Shareholder present in person or by proxy shall have one (1)
vote for each Share which he holds or represents. In the case of a tied vote, the chairman of the meeting
at which the vote is taken shall be entitled to a casting vote.
DIVIDENDS
The Company may, by ordinary resolution of its Shareholders, declare dividends at a general meeting,
but it may not pay dividends in excess of the amount recommended by the Board of Directors. The
Company must pay all dividends out of its prots. The Board of Directors may also declare an interim
dividend without the approval of its Shareholders. All dividends are paid pro rata among the Shareholders
in proportion to the amount paid up on each Shareholders Shares, unless the rights attaching to an issue
of any Share provides otherwise. Unless otherwise directed, dividends are paid by cheque or warrant
sent through the post to each Shareholder at his registered address. Notwithstanding the foregoing, the
payment by the Company to the CDP of any dividend payable to a Shareholder whose name is entered in
the depository register shall, to the extent of payment made to the CDP, discharge the Company from any
liability to that Shareholder in respect of that payment.
CAPITALISATION AND RIGHTS ISSUES
The Board of Directors may, with approval by the Shareholders at a general meeting, capitalise any
prots and distribute the same as shares credited as paid-up to the Shareholders in proportion to their
shareholdings. The Board of Directors may also issue rights to take up additional Shares to Shareholders
in proportion to their shareholdings. Such rights are subject to any conditions attached to such issue and
the regulations of any stock exchange on which the Company is listed.
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TAKEOVERS
The SFA and The Singapore Code on Take-overs and Mergers regulate the acquisition of ordinary shares
of public companies and contain certain provisions that may delay, deter or prevent a future takeover or
change in control of the Company. Any person acquiring an interest, either on his own or together with
parties acting in concert with him, in thirty per cent. (30%) or more of the voting shares in the Company
must extend a takeover offer for the remaining voting shares in accordance with the provisions of The
Singapore Code on Take-overs and Mergers. Parties acting in concert include a company and its related
and associated companies, a company and its directors (including their relatives), a company and its
pension funds, a person and any investment company, unit trust or other fund whose investment such
person manages on a discretionary basis, and a nancial adviser and its client in respect of shares held
by the nancial adviser and shares in the client held by funds managed by the nancial adviser on a
discretionary basis. An offer for consideration other than cash must be accompanied by a cash alternative
at not less than the highest price paid by the offeror or parties acting in concert with the offeror within the
preceding six months. A mandatory takeover offer is also required to be made if a person holding, either
on his own or together with parties acting in concert with him, between thirty per cent. (30%) and fty per
cent. (50%) of the voting rights acquires additional voting shares representing more than one per cent.
(1%) of the voting shares in any six (6) month period.
LIQUIDATION OR OTHER RETURN OF CAPITAL
If the Company liquidates or in the event of any other return of capital, holders of ordinary shares will be
entitled to participate in any surplus assets in proportion to their shareholdings, subject to any special
rights attaching to any other class of shares.
INDEMNITY
As permitted by Singapore law, the Articles provide that, subject to the Companies Act, the Board of
Directors and ofcers shall be entitled to be indemnied by the Company against any liability incurred
in defending any proceedings, whether civil or criminal, which relate to anything done or omitted to have
been done as an ofcer, director or employee and in which judgment is given in their favour or in which
they are acquitted or in connection with any application under any statute for relief from liability in respect
thereof in which relief is granted by the court. The Company may not indemnify directors and ofcers
against any liability which by law would otherwise attach to them in respect of any negligence, default,
breach of duty or breach of trust of which they may be guilty in relation to the Company.
LIMITATIONS ON RIGHTS TO HOLD OR VOTE SHARES
Except as described in the section entitled Voting Rights and Takeovers above, there are no limitations
imposed by Singapore law or by the Articles on the rights of non-resident Shareholders to hold or vote on
Shares.
MINORITY RIGHTS
The rights of minority shareholders of Singapore-incorporated companies are protected under Section
216 of the Companies Act, which gives the Singapore courts a general power to make any order, upon
application by any shareholder of the Company, as they think t to remedy any of the following situations:
(a) the affairs of the Company are being conducted or the powers of the Board of Directors are being
exercised in a manner oppressive to, or in disregard of the interests of, one (1) or more of the
Shareholders; or
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(b) the Company takes an action, or threatens to take an action, or the Shareholders pass a
resolution, or propose to pass a resolution, which unfairly discriminates against, or is otherwise
prejudicial to, one (1) or more of the Shareholders, including the applicant. Singapore courts have
wide discretion as to the reliefs they may grant and those reliefs are in no way limited to those
listed in the Companies Act itself. Without prejudice to the foregoing, Singapore courts may:
(a) direct or prohibit any act or cancel or vary any transaction or resolution;
(b) regulate the conduct of the affairs of the Company in the future;
(c) authorise civil proceedings to be brought in the name of, or on behalf of, the Company by a
person or persons and on such terms as the court may direct;
(d) provide for the purchase of a minority shareholders shares by the other shareholders or by
the Company and, in the case of a purchase of shares by the Company, a corresponding
reduction of its share capital;
(e) provide that the Memorandum of Association or the Articles be amended; or
(f) provide that the Company be wound up.
F-1
APPENDIX F: RULES OF THE ASIAPHOS PERFORMANCE SHARE PLAN
1. NAME OF THE PLAN
The Plan shall be called the AsiaPhos Performance Share Plan.
2. DEFINITIONS
2.1 In the Plan, unless the context otherwise requires, the following words and expressions shall have
the following meanings:

Act The Companies Act (Chapter 50) of Singapore, as amended or
modied from time to time

Adoption Date The date on which the Plan is adopted by resolution of the
Shareholders of the Company

Articles The Articles of Association of the Company, as amended or modied
from time to time

Associate (a) in relation to any director, chief executive ofcer, substantial
shareholder or controlling shareholder (being an individual)
means:
(i) his immediate family;
(ii) the trustees of any trust of which he or his immediate
family is a beneciary or, in the case of a discretionary
trust, is a discretionary object; and
(iii) any company in which he and his immediate family
together (directly or indirectly) have an interest of 30.0%
or more; and
(b) in relation to a substantial shareholder or a controlling
shareholder (being a company) means any other company
which is its subsidiary or holding company or is a subsidiary of
such holding company or one in the equity of which it and/ or
such other company or companies taken together (directly or
indirectly) have an interest of 30.0% or more

Auditors The auditors of the Company for the time being

Award A contingent award of Shares granted under Rule 5

Award Date In relation to an Award, the date on which the Award is granted
pursuant to Rule 5.

Award Letter A letter in such form as the Committee shall approve conrming an
Award granted to a Participant by the Committee.
Board The Board of Directors of the Company for the time being
Catalist The Catalist Board of the SGX-ST

Catalist Rules Section B: Rules of Catalist of the Listing Manual of the SGX-ST, as
amended, modied or supplemented from time to time.

CDP The Central Depository (Pte) Limited

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Committee The committee comprising the Directors duly authorised and
appointed by the Board of Directors pursuant to Rule 10 to administer
the Plan

Company AsiaPhos Private Limited

Control The capacity to dominate decision-making, directly or indirectly, in
relation to the nancial and operating policies of the Company

Controlling Shareholder A person who holds directly or indirectly 15.0% or more of the nominal
amount of all voting shares in the Company; or in fact exercises
Control over the Company.

Depositor A person being a Depository Agent or holder of a securities account
maintained with CDP but not including a holder of a sub-account
maintained with a Depository Agent

Group The Company and its subsidiaries

Group Executive Any full-time employee of our Group (including any Group Director
who meets the relevant age and rank criteria and who shall be
regarded as a Group Executive for the purposes of the Plan) selected
by the Committee to participate in the Plan in accordance with Rule
4.1

Group Executive A director of our Company and/ or any of its subsidiaries, as the case
Director may be, who performs an executive function

Group Non-Executive A director of our Company and/ or any of its subsidiaries, as the case
Director may be, who is not a Group Executive Director, including independent
directors

Market Value In relation to a Share, on any day:
(a) the average price of a Share on the SGX-ST over the ve (5)
immediately preceding Trading Days; or
(b) if the Committee is of the opinion that the Market Value as
determined in accordance with (a) above is not representative
of the value of a Share, such price as the Committee may
determine, such determination to be conrmed in writing by the
Auditors (acting only as experts and not as arbitrators) to be in
their opinion, fair and reasonable

New Shares New ordinary shares in the capital of the Company

Non-Executive Director A director (other than an Executive Director) from time to time of the
Company and/ or any of its subsidiaries

Participant Any eligible person selected by the Committee to participate in the
Plan in accordance with the rules thereof

Performance Condition In relation to an Award, the condition specied on the Award Date in
relation to that Award

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Performance Period In relation to an Award, a period, the duration of which is to be
determined by the Committee on the Award Date, during which the
Performance Condition is to be satised

Plan The AsiaPhos Performance Share Plan, as the same may be modied
or altered from time to time

Release In relation to an Award, the release at the end of the Performance
Period relating to that Award of all or some of the Shares to which
that Award relates in accordance with Rule 7 and, to the extent that
any Shares which are the subject of the Award are not released
pursuant to Rule 7, the Award in relation to those Shares shall lapse
accordingly, and Released shall be construed accordingly

Release Schedule In relation to an Award, a schedule in such form as the Committee
shall approve, setting out the extent to which Shares which are the
subject of that Award shall be Released on the Performance Condition
being satised (whether fully or partially) or exceeded or not being
satised, as the case may be, at the end of the Performance Period

Released Award An Award which has been released in accordance with Rule 7

Retention Period In relation to an Award, such period commencing on the Vesting Date
in relation to that Award as may be determined by the Committee on
the Award Date

SGX-ST The Singapore Exchange Securities Trading Limited

Shares Ordinary shares in the capital of the Company

Shareholders The registered holders for the time being of the shares (other than
the CDP) or in the case of Depositors, Depositors who have Shares
entered against their names in the Depository Register

subsidiary A Company (whether incorporated within or outside Singapore and
wheresoever resident) being a subsidiary for the time being of the
Company within the meaning of Section 5 of the Act.
Trading Day A day on which the Shares are traded on Catalist

Vesting In relation to Shares which are the subject of a Released Award, the
absolute entitlement to all or some of the Shares which are the subject
of a Released Award and Vest and Vested shall be construed
accordingly

Vesting Date In relation to Shares which are the subject of a Released Award, the
date (as determined by the Committee and notied to the relevant
Participant) on which those Shares have Vested pursuant to Rule 7
2.2 For purposes of the Plan, the Company shall be deemed to have control over another company if
it has the capacity to dominate decision-making, directly or indirectly, in relation to the nancial and
operating policies of that company.
2.3 Words importing the singular number shall, where applicable, include the plural number and vice
versa. Words importing the masculine gender shall, where applicable, include the feminine and
neuter genders.
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2.4 Any reference to a time of a day in the Plan is a reference to Singapore time.
2.5 Any reference in the Plan to any enactment is a reference to that enactment as for the time being
amended or re-enacted. Any word dened under the Act or any statutory modication thereof and
not otherwise dened in the Plan and used in the Plan shall have the meaning assigned to it under
the Act or any statutory modication thereof, as the case may be.
2.6 The terms Depository Register and Depository Agent shall have the same meaning ascribed to
them by Section 130A of the Act.
3. OBJECTIVES OF THE PLAN
The Plan has been proposed in order to:
(a) foster a framework of ownership within the Group which coordinates the interests of our
Group Executives with the interests of Shareholders;
(b) motivate Participants to achieve key nancial and operational goals of our Company and/ or
their respective business units and encourage greater commitment and loyalty to our Group;
(c) make total employee remuneration sufciently competitive to recruit new Participants with
relevant skills; and
(d) recognise the efforts of and retain existing Participants whose contributions are important to
the long-term development and protability of our Group
4. ELIGIBILITY OF PARTICIPANTS
4.1 The following persons shall be eligible to participate in the Plan at the absolute discretion of the
Committee:
(i) Group Executives
Group Executives who have attained the age of 21 years as of the Award Date and hold
such rank as may be designated by the Committee from time to time. The Participant must
also not be an undischarged bankrupt and must not have entered into a composition with his
creditors.
(ii) Controlling Shareholders and Associates of Controlling Shareholders
Subject to Rule 4.2, persons who are qualied under 4.1(i) above and who are also
Controlling Shareholders or Associates of Controlling Shareholders.
4.2 Group Executives who are Controlling Shareholders or Associates of Controlling Shareholders
shall (notwithstanding that they may meet the eligibility criteria in Rule 4.1(i) above) not participate
in the Plan unless:
(i) their participation; and
(ii) the terms of each grant and the actual number of Awards to be granted to them,
have been approved by the independent Shareholders in general meeting in separate resolutions
for each such person, and in respect of each such person, in separate resolutions for each of (i)
his participation and (ii) the terms of each grant and the actual number of Awards to be granted
to him, provided always that it shall not be necessary to obtain the approval of the independent
Shareholders of our Company for the participation in the Plan of a Controlling Shareholder or
an Associate of a Controlling Shareholder who is, at the relevant time already a Participant. For
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the purposes of obtaining such approval from the independent Shareholders, our Company shall
procure that the circular, letter or notice to the Shareholder in connection therewith shall set out the
following:
(a) clear justications for the participation of such Controlling Shareholders or Associates of
Controlling Shareholders; and
(b) clear rationale for the terms of the Awards to be granted to such Controlling Shareholders or
Associates of Controlling Shareholders.
4.3 Save as prescribed by Rule 852 of the Catalist Rules, there shall be no restriction on the eligibility
of any Participant to participate in any other share option or share incentive scheme, whether or
not implemented by any other companies within our Group.
4.4 Subject to the Act and any requirement of the SGX-ST or any other stock exchange on which
the Shares may be listed or quoted, the terms of eligibility for participation in the Plan may be
amended from time to time at the absolute discretion of the Committee.
5. GRANT OF AWARDS
5.1 Except as provided in Rule 8, the Committee may grant Awards to Group Executives as the
Committee may select, in its absolute discretion, at any time during the period when the Plan is
in force, provided that no Participant who is a member of the Committee shall participate in any
deliberation or decision in respect of Awards granted or to be granted to him.
5.2 The number of Shares which are the subject of each Award to be granted to a Participant in
accordance with the Plan shall be determined at the absolute discretion of the Committee,
which shall take into account criteria such as his rank, job performance and potential for future
development, his contribution to the success and development of the Group and the extent of effort
with which the Performance Condition may be achieved within the Performance Period, provided
that in relation to Controlling Shareholders or Associates of Controlling Shareholders:
(a) the aggregate number of Shares which may be offered by way of grant of Awards to
Participants who are Controlling Shareholders or Associates of Controlling Shareholders
under this Plan shall not exceed twenty-ve per cent. (25.0%) of the total number of Shares
available under this Plan, and such aggregate number of Shares which may be offered to
such Participants under this Plan has been approved by the independent shareholder of
our Company in a separate resolution. For the purposes of obtaining such approval of the
independent shareholder of our Company, the Remuneration Committee shall procure that
the circular, letter or notice to the shareholder in connection therewith shall set out clear
rationale for the participation of and grant of Awards to Participants who are Controlling
Shareholders or Associates of Controlling Shareholders, provided always that it shall not
be necessary to obtain the approval of the independent shareholders of our Company
for the participation in this Plan of Controlling Shareholders or Associates of Controlling
Shareholders who at the relevant time were already Participants; and
(b) the number of Shares available to each Controlling Shareholders or Associate of a
Controlling Shareholder shall not exceed ten per cent. (10.0%) of the Shares available under
this Plan.
5.3 The Committee shall decide in relation to an Award:
(a) the Participant;
(b) the Award Date;
(c) the Performance Period;
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(d) the number of Shares which are the subject of the Award;
(e) the Performance Condition(s);
(f) the Release Schedule; and
(g) any other condition(s) which the Committee may determine in relation to that Award.
5.4 The Committee may amend or waive the Performance Period, the Performance Condition and/ or
the Release Schedule in respect of any Award:
(a) in the event of a take-over offer being made for the Shares or if (i) shareholders of the
Company or (ii) under the Act, the court, sanctions a compromise or arrangement proposed
for the purposes of, or in connection with, a scheme for the reconstruction of the Company
or its amalgamation with another company or companies or in the event of a proposal to
liquidate or sell all or substantially all of the assets of the Company; or
(b) if anything happens which causes the Committee to conclude that:
(i) a changed Performance Condition and/ or Release Schedule would be a fairer
measure of performance, and would be no less difcult to satisfy; or
(ii) the Performance Condition(s) and/ or Release Schedule should be waived, and shall
notify the Participants of such change or waiver.
5.5 As soon as reasonably practicable after making an Award the Committee shall send to each
Participant an Award Letter conrming the Award and specifying in relation to the Award:
(a) the Award Date;
(b) the Performance Period;
(c) the number of Shares which are the subject of the Award;
(d) the Performance Condition(s);
(e) the Release Schedule; and
(f) any other condition which the Committee may determine in relation to that Award.
5.6 Participants are not required to pay for the grant of Awards.
5.7 An Award or Released Award shall be personal to the Participant to whom it is granted and, prior
to the allotment and/ or transfer to the Participant of the Shares to which the Released Award
relates, shall not be transferred, charged, assigned, pledged or otherwise disposed of, in whole
or in part, except with the prior approval of the Committee and if a Participant shall do, suffer or
permit any such act or thing as a result of which he would or might be deprived of any rights under
an Award or Released Award without the prior approval of the Committee, that Award or Released
Award shall immediately lapse.
6. EVENTS PRIOR TO THE VESTING DATE
6.1 An Award shall, to the extent not yet Released, immediately lapse without any claim whatsoever
against the Company:
(a) in the event of misconduct on the part of the Participant as determined by the Committee in
its discretion;
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(b) where the Participant is an Employee, upon the Participant ceasing to be in the employment
of the Group for any reason whatsoever; or
(c) where the Participant is a Group Director, upon the Participant ceasing to be a Group
Director for any reason whatsoever; or
(d) in the event of an order being made or a resolution passed for the winding-up of the
Company on the basis, or by reason, of its insolvency.
For the purpose of Rule 6.1(b), the Participant shall be deemed to have ceased to be so employed
as of the date the notice of termination of employment is tendered by or is given to him, unless
such notice shall be withdrawn prior to its effective date.
For the purpose of Rule 6.1(c), the Participant shall be deemed to have ceased to be a Group
Director as of the date the notice of resignation of or termination of directorship (as the case may
be) is tendered by or is given to him, unless such notice shall be withdrawn prior to its effective
date.
6.2 In any of the following events, namely:
(a) the bankruptcy of the Participant or the happening of any other event which results in his
being deprived of the legal or benecial ownership of an Award;
(b) where the Participant being a Group Executive ceases to be in the employment of the Group
by reason of:
(i) ill health, injury or disability (in each case, evidenced to the satisfaction of the
Committee);
(ii) redundancy;
(iii) retirement at or after the legal retirement age;
(iv) retirement before the legal retirement age with the consent of the Committee;
(v) the company by which he is employed or to which he is seconded, as the case may
be, ceasing to be a company within our Group or the undertaking or part of the
undertaking of such company being transferred otherwise than to another company
within our Group;
(vi) (where applicable) his transfer of employment between companies within the Group;
(vii) his transfer to any government ministry, governmental or statutory body or corporation
at the direction of any company within the Group; or
(viii) any other event approved by the Committee;
(c) the death of a Participant; or
(d) any other event approved by the Committee,
the Committee may, in its absolute discretion, preserve all or any part of any Award and decide
as soon as reasonably practicable following such event either to Vest some or all of the Shares
which are the subject of any Award or to preserve all or part of any Award until the end of the
Performance Period and subject to the provisions of the Plan. In exercising its discretion, the
Committee will have regard to all circumstances on a case-by-case basis, including (but not limited
to) the contributions made by that Participant and the extent to which the Performance Condition
has been satised.
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6.3 Without prejudice to the provisions of Rule 5.4, if before the Vesting Date, any of the following
occurs:
(a) a take-over offer for the Shares becomes or is declared unconditional;
(b) a compromise or arrangement proposed for the purposes of, or in connection with, a
scheme for the reconstruction of the Company or its amalgamation with another company or
companies being approved by shareholders of the Company and/ or sanctioned by the court
under the Act; or
(c) an order being made or a resolution being passed for the winding up of the Company (other
than as provided in Rule 6.1(c) or for amalgamation or reconstruction),
the Committee will consider, at its discretion, whether or not to Release any Award, and will
take into account all circumstances on a case-by-case basis, including (but not limited to) the
contributions made by that Participant. If the Committee decides to Release any Award, then in
determining the number of Shares to be Vested in respect of such Award, the Committee will have
regard to the proportion of the Performance Period which has elapsed and the extent to which
the Performance Condition has been satised. Where Awards are Released, the Committee will,
as soon as practicable after the Awards have been Released, procure the allotment or transfer to
each Participant of the number of Shares so determined, such allotment or transfer to be made in
accordance with Rule 7. If the Committee so determines, the Release of Awards may be satised
in cash as provided in Rule 7.
7. RELEASE OF AWARDS
7.1 Review of Performance Condition
(a) As soon as reasonably practicable after the end of each Performance Period, the Committee
shall review the Performance Condition specied in respect of each Award and determine
at its discretion whether it has been satised and, if so, the extent to which it has been
satised, and provided that the relevant Participant has continued to be a Group Executive
from the Award Date up to the end of the Performance Period, shall Release to that
Participant all or part (as determined by the Committee at its discretion in the case where
the Committee has determined that there has been partial satisfaction of the Performance
Condition) of the Shares to which his Award relates in accordance with the Release
Schedule specied in respect of his Award on the Vesting Date. If not, the Awards shall lapse
and be of no value.
If the Committee determines in its sole discretion that the Performance Condition has not
been satised or (subject to Rule 6) if the relevant Participant has not continued to be a
Group Executive from the Award Date up to the end of the relevant Performance Period, that
Award shall lapse and be of no value and the provisions of Rules 7.2 to 7.4 shall be of no
effect.
The Committee shall have the discretion to determine whether the Performance Condition
has been satisfied (whether fully or partially) or exceeded and in making any such
determination, the Committee shall have the right to make computational adjustments
to the audited results of the Company or the Group to take into account such factors as
the Committee may determine to be relevant, including changes in accounting methods,
taxes and extraordinary events, and further the right to amend the Performance Condition
if the Committee decides that a changed performance target would be a fairer measure of
performance.
(b) Shares which are the subject of a Released Award shall be Vested to a Participant on the
Vesting Date, which shall be a Trading Day falling as soon as practicable after the review
by the Committee referred to in Rule 7.1(a) and, on the Vesting Date, the Committee will
procure the allotment or transfer to each Participant of the number of Shares so determined.
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(c) Where new Shares are allotted upon the Vesting of any Award, the Company shall, as soon
as practicable after such allotment, apply to the Sponsor and/ or the SGX-ST and any other
stock exchange on which the Shares are quoted and listed for permission to deal in and for
quotation of such Shares.
7.2 Release of Award
On Vesting of the Award, after the end of each Performance Period, the Committee has the
discretion to determine whether to issue new Shares or to procure the transfer of existing Shares,
or a combination of both methods to the Participant. Shares which are allotted or transferred on
the Release of an Award to a Participant shall be issued in the name of, or transferred to, CDP to
the credit of the securities account of that Participant maintained with the CDP or the securities
sub-account of that Participant maintained with a Depository Agent, in each case, as designated by
that Participant.
7.3 Ranking of Shares
New Shares allotted and issued, and existing Shares procured by the Company for transfer, on the
Release of an Award shall:
(a) be subject to all the provisions of the Memorandum and Articles of Association of the
Company (including provisions relating to the liquidation of the Company); and
(b) rank in full for all entitlements, including dividends or other distributions declared or
recommended in respect of the then existing Shares, the Record Date for which is on or
after the relevant Vesting Date, and shall in all other respects rank pari passu with other
existing Shares then in issue.
Record Date means the date xed by the Company for the purposes of determining entitlements
to dividends or other distributions to or rights of holders of Shares.
7.4 Cash Awards
The Committee, in its absolute discretion, may determine to make a Release of an Award, wholly
or partly, in the form of cash rather than Shares, in which event the Participant shall receive on
the Vesting Date, in lieu of all or part of the Shares which would otherwise have been allotted or
transferred to him on Release of his Award, the aggregate Market Value of such Shares on the
Vesting Date.
7.5 Moratorium
Shares which are allotted and issued or transferred to a Participant pursuant to the Release of
an Award shall not be transferred, charged, assigned, pledged or otherwise disposed of, in whole
or in part, during the Retention Period, except to the extent set out in the Award Letter or with
the prior approval of the Committee. The Company may take steps that it considers necessary or
appropriate to enforce or give effect to this disposal restriction including specifying in the Award
Letter the conditions which are to be attached to an Award for the purpose of enforcing this
disposal restriction.
8. LIMITATION ON THE SIZE OF THE PLAN
8.1 The aggregate number of Shares which may be issued or transferred pursuant to Awards granted
under the Plan on any date, when added to (i) the number of Shares issued and issuable and/
or transferred or transferable in respect of all Awards granted under the Plan; and (ii) all Shares
issued and issuable and/ or transferred or transferable in respect of all options granted or awards
granted under any other share incentive schemes or share plans adopted by the Company for
the time being in force, shall not exceed fteen per cent. (15.0%) of the entire issued and paid-up
share capital (excluding treasury shares) of the Company on the day preceding that date.
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8.2 In addition, the number of Shares available to Controlling Shareholders or Associates of a
Controlling Shareholder under this Plan is subject to the limits stated in Rule 5.2 above.
8.3 Shares which are the subject of Awards which have lapsed for any reason whatsoever may be the
subject of further Awards granted by the Committee under the Plan.
9. ADJUSTMENT EVENTS
9.1 If a variation in the issued ordinary share capital of the Company (whether by way of a
capitalisation of prots or reserves or rights issue, capital reduction, subdivision, consolidation,
distribution or otherwise) shall take place, then:
(a) the class and/ or number of Shares which is/are the subject of an Award to the extent not yet
Vested; and/ or
(b) the class and/ or number of Shares in respect of which future Awards may be granted under
the Plan,
shall be adjusted in such manner as the Committee may determine to be appropriate, provided that
no adjustment shall be made if as a result, the Participant receives a benet that a shareholder
does not receive.
9.2 Unless the Committee considers an adjustment to be appropriate, the issue of securities as
consideration for an acquisition or a private placement of securities, or the cancellation of issued
Shares purchased or acquired by the Company by way of a market purchase of such Shares
undertaken by the Company on the SGX-ST during the period when a share purchase mandate
granted by shareholders of the Company (including any renewal of such mandate) is in force, shall
not normally be regarded as a circumstance requiring adjustment.
9.3 Notwithstanding the provisions of Rule 9.1, any adjustment (except in relation to a capitalisation
issue) must be conrmed in writing by the Auditors (acting only as experts and not as arbitrators)
to be in their opinion, fair and reasonable.
9.4 Upon any adjustment required to be made pursuant to this Rule 9, the Company shall notify the
Participant (or his duly appointed personal representatives where applicable) in writing and deliver
to him (or his duly appointed personal representatives where applicable) a statement setting forth
the nominal amount, class and/ or number of Shares thereafter to be issued or transferred on the
Vesting of an Award. Any adjustment shall take effect upon such written notication being given.
10. ADMINISTRATION OF THE PLAN
10.1 The Plan shall be administered by the Committee in its absolute discretion with such powers and
duties as are conferred on it by the Board of Directors of the Company, provided that no member
of the Committee shall participate in any deliberation or decision in respect of Awards granted or to
be granted to him.
10.2 The Committee shall have the power, from time to time, to make and vary such arrangements,
guidelines and/ or regulations (not being inconsistent with the Plan) for the implementation and
administration of the Plan, to give effect to the provisions of the Plan and/ or to enhance the
benet of the Awards and the Released Awards to the Participants, as they may, in their absolute
discretion, think t. Any matter pertaining or pursuant to the Plan and any dispute and uncertainty
as to the interpretation of the Plan, any rule, regulation or procedure thereunder or any rights under
the Plan shall be determined by the Committee.
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10.3 Neither the Plan nor the grant of Awards under the Plan shall impose on the Company or the
Committee or any of its members any liability whatsoever in connection with:
(a) the lapsing of any Awards pursuant to any provision of the Plan;
(b) the failure or refusal by the Committee to exercise, or the exercise by the Committee of, any
discretion under the Plan; and/ or
(c) any decision or determination of the Committee made pursuant to any provision of the Plan.
10.4 Any decision or determination of the Committee made pursuant to any provision of the Plan (other
than a matter to be certied by the Auditors) shall be nal, binding and conclusive (including for the
avoidance of doubt, any decisions pertaining to disputes as to the interpretation of the Plan or any
rule, regulation or procedure hereunder or as to any rights under the Plan). The Committee shall
not be required to furnish any reasons for any decision or determination made by it.
11. NOTICES AND COMMUNICATIONS
11.1 Any notice required to be given by a Participant to the Company shall be sent or made to the
registered ofce of the Company or such other addresses (including electronic mail addresses)
or facsimile number, and marked for the attention of the Committee, as may be notied by the
Company to him in writing.
11.2 Any notices or documents required to be given to a Participant or any correspondence to be made
between the Company and the Participant shall be given or made by the Committee (or such
person(s) as it may from time to time direct) on behalf of the Company and shall be delivered
to him by hand or sent to him at his home address, electronic mail address or facsimile number
according to the records of the Company or the last known address, electronic mail address or
facsimile number of the Participant.
11.3 Any notice or other communication from a Participant to the Company shall be irrevocable, and
shall not be effective until received by the Company. Any other notice or communication from the
Company to a Participant shall be deemed to be received by that Participant, when left at the
address specied in Rule 11.2 or, if sent by post, on the day following the date of posting or, if sent
by electronic mail or facsimile transmission, on the day of despatch.
12. MODIFICATIONS TO THE PLAN
12.1 Any or all the provisions of the Plan may be modied and/ or altered at any time and from time to
time by a resolution of the Committee, except that:
(a) no modication or alteration shall alter adversely the rights attached to any Award granted
prior to such modication or alteration except with the consent in writing of such number of
Participants who, if their Awards were Released to them upon the Performance Conditions
for their Awards being satised in full, would become entitled to not less than three-quarters
of all the Shares which would fall to be Vested upon Release of all outstanding Awards upon
the Performance Conditions for all outstanding Awards being satised in full;
(b) the denitions of Group Executive, Group Executive Director, Group Non-Executive
Director, Participant, Performance Period and Release Schedule and the provisions
of Rules 4, 5, 6, 7, 8, 9, 10 and this Rule 12 shall not be altered to the advantage of
Participants except with the prior approval of the Companys shareholders in general
meeting; and
(c) no modication or alteration shall be made without the prior approval of the SGX-ST and
such other regulatory authorities as may be necessary.
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For the purposes of Rule 12.1(a), the opinion of the Committee as to whether any modication
or alteration would adversely affect the rights attached to any Award shall be nal, binding and
conclusive. For the avoidance of doubt, nothing in this Rule 12.1 shall affect the right of the
Committee under any other provision of the Plan to amend or adjust any Award.
12.2 Notwithstanding anything to the contrary contained in Rule 12.1, the Committee may at any time
by resolution (and without other formality, save for the prior approval of the SGX-ST) amend or
alter the Plan in any way to the extent necessary or desirable, in the opinion of the Committee, to
cause the Plan to comply with, or take into account, any statutory provision (or any amendment
or modication thereto, including amendment of or modication to the Act) or the provision or the
regulations of any regulatory or other relevant authority or body (including the SGX-ST).
12.3 Written notice of any modication or alteration made in accordance with this Rule 12 shall be given
to all Participants.
13. TERMS OF EMPLOYMENT UNAFFECTED
The terms of employment of a Participant shall not be affected by his participation in the Plan,
which shall neither form part of such terms nor entitle him to take into account such participation in
calculating any compensation or damages on the termination of his employment for any reason.
14. DURATION OF THE PLAN
14.1 The Plan shall continue to be in force at the discretion of the Committee, subject to a maximum
period of ten (10) years commencing on the Adoption Date, provided always that the Plan may
continue beyond the above stipulated period with the approval of the Companys shareholders by
ordinary resolution in general meeting and of any relevant authorities which may then be required.
14.2 The Plan may be terminated at any time by the Committee or, at the discretion of the Committee,
by an ordinary resolution of the Company in general meeting, subject to all relevant approvals
which may be required and if the Plan is so terminated, no further Awards shall be granted by the
Committee hereunder.
14.3 The expiry or termination of the Plan shall not affect Awards which have been granted prior to such
expiry or termination, whether such Awards have been Released (whether fully or partially) or not.
15. TAXES
All taxes (including income tax) arising from the grant or Release of any Award granted to any
Participant under the Plan shall be borne by that Participant.
16. COSTS AND EXPENSES OF THE PLAN
16.1 Each Participant shall be responsible for all fees of the CDP (if any) relating to or in connection
with the issue and allotment or transfer of any Shares pursuant to the Release of any Award in the
CDPs name, the deposit of share certicate(s) with CDP, the Participants securities account with
CDP, or the Participants securities sub-account with a CDP Depository Agent or CPF investment
account with a CPF agent bank.
16.2 Save for the taxes referred to in Rule 15 and such other costs and expenses expressly provided in
the Plan to be payable by the Participants, all fees, costs and expenses incurred by the Company
in relation to the Plan including but not limited to the fees, costs and expenses relating to the
allotment and issue, or transfer, of Shares pursuant to the Release of any Award, shall be borne by
the Company.
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17. DISCLAIMER OF LIABILITY
Notwithstanding any provisions herein contained, the Committee and the Company shall not
under any circumstances be held liable for any costs, losses, expenses and damages whatsoever
and howsoever arising in any event, including but not limited to the Companys delay in issuing,
or procuring the transfer of, the Shares or applying for or procuring the listing of new Shares on
Catalist.
18. DISCLOSURES IN ANNUAL REPORTS
The following disclosures (as applicable) will be made by the Company in its annual report for so
long as the Plan continues in operation:
(a) the names of the members of the Committee administering the Plan;
(b) in respect of the following Participants:
(i) Directors of our Company;
(ii) Controlling Shareholders and their Associates; and
(iii) Participants (other than those in paragraphs (i) and (ii) above) who have received
Shares pursuant to the Release of Awards granted under the Plan which, in
aggregate, represent ve per cent. (5.0%) or more of the aggregate number of new
Shares available under the Plan;
the following information:
(aa) the name of the Participant;
(bb) the aggregate number of Shares comprised in Awards granted during the nancial
year under review;
(cc) the number of new Shares issued to such Participant during the nancial year under
review;
(dd) the number of existing Shares purchased for delivery pursuant to Release of Awards
to such Participant during the nancial year under review;
(ee) the aggregate number of Shares comprised in Awards which have not been released
as at the end of the nancial year under review;
(ff) the aggregate number of Shares comprised in Awards granted since the
commencement of the Plan to the end of the nancial year under review;
(gg) the number of new Shares allotted to such Participant since the commencement of the
Performance Share Plan to the end of nancial year under review; and
(hh) the number of existing Shares transferred to such Participant since the
commencement of the Performance Share Plan to the end of the nancial year under
review,
(c) in relation to the Plan:
(i) the aggregate number of Shares comprised in Awards which have Vested under the
Plan since the commencement of the Plan to the end of the nancial year under
review;
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(ii) the aggregate number of new Shares issued which are comprised in the Awards
Vested during the nancial year under review; and
(iii) the aggregate number of Shares comprised in Awards which have not yet Released,
as at the end of the nancial year under review; and
(d) such other information as may be required by the Catalist Rules or the Act.
If any of the above is not applicable, an appropriate negative statement shall be included therein.
19. DISPUTES
Any disputes or differences of any nature arising hereunder shall be referred to the Committee and
its decision shall be nal and binding in all respects.
20. CONDITION OF AWARDS
Every Award shall be subject to the condition that no Shares would be issued and/ or transferred
pursuant to the vesting of any Award if such issue and/ or transfer would be contrary to any law or
enactment, or any rules or regulations of any legislative or non-legislative governing body for the
time being in force in Singapore or any other relevant country having jurisdiction in relation to the
issue and/ or transfer of Shares hereto.
21. CONTRACTS (RIGHTS OF THIRD PARTIES) ACT, CHAPTER 53B
No person other than the Company or a Participant shall have any right to enforce any provision of
the Plan or any Award by the virtue of the Contracts (Rights of Third Parties) Act, Chapter 53B of
Singapore.
22. ELIGIBLE SHAREHOLDERS
Shareholders who are eligible to participate in the Plan must abstain from voting on any resolution
relating to the Plan (other than a resolution relating to the participation of, or grant of options to,
directors and employees of the issuers parent company and its subsidiaries).
23. GOVERNING LAW
The Plan shall be governed by, and construed in accordance with, the laws of the Republic of
Singapore. The Participants, by accepting grants of Awards in accordance with the Plan, and the
Company submit to the exclusive jurisdiction of the courts of the Republic of Singapore.
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APPENDIX G: TERMS, CONDITIONS AND PROCEDURES FOR APPLICATION AND
ACCEPTANCE
You are invited to apply and subscribe for and/ or purchase the Invitation Shares at the Invitation Price for
each Invitation Share subject to the following terms and conditions:
1. YOUR APPLICATION MUST BE MADE IN LOTS OF 1,000 INVITATION SHARES AND
INTEGRAL MULTIPLES THEREOF. YOUR APPLICATION FOR ANY OTHER NUMBER OF
SHARES WILL BE REJECTED.
2. Your application for Offer Shares may be made by way of WHITE Offer Shares Application
Forms or by way of Electronic Applications through ATMs of the Participating Banks (ATM
Electronic Applications) or through Internet Banking (IB) websites of the relevant Participating
Banks (Internet Electronic Applications, which together with ATM Electronic Applications, shall
be referred to as Electronic Applications). Your application for the Placement Shares may only
be made by way of printed BLUE Placement Shares Application Forms or other such forms of
application the Sponsor and Underwriter and the Placement Agent deem appropriate.
YOU MAY NOT USE CPF FUNDS TO APPLY FOR THE SHARES.
3. You are allowed to submit only one application in your own name for the Offer Shares
or the Placement Shares. If you submit an application for Offer Shares by way of an
Application Form, you MAY NOT submit another application for Offer Shares by way of an
Electronic Application and vice versa. Such separate applications shall be deemed to be
multiple applications and may be rejected at the discretion of our Company, the Vendors,
the Sponsor and Underwriter, except in the case of applications by approved nominees
companies, where each application is made on behalf of a different beneciary.
If you submit an application for Offer Shares by way of an ATM Electronic Application,
you MAY NOT submit another application for Offer Shares by way of an Internet Electronic
Application and vice versa. Such separate applications shall be deemed to be multiple
applications and may be rejected at the discretion of our Company, the Vendors and the
Sponsor and Underwriter.
If you, being other than an approved nominee company, have submitted an application
for Offer Shares in your own name, you should not submit any other application for Offer
Shares, whether by way of an Application Form or by way of an Electronic Application, for
any other person. Such separate applications shall be deemed to be multiple applications
and may be rejected at the discretion of our Company, the Vendors and the Sponsor and
Underwriter.
You are allowed to submit only one application in your own name for the Placement Shares.
Any separate application by you for the Placement Shares are deemed to be multiple
applications and the Company, the Vendors and the Placement Agent have the discretion to
accept or reject such multiple applications.
If you, being other than an approved nominee company, have submitted an application
for Placement Shares in your own name, you should not submit any other application for
Placement Shares for any other person. Such separate applications shall be deemed to be
multiple applications and may be rejected at the discretion of our Company, the Vendors
and the Placement Agent.
If you have made an application for Placement Shares, and you have also made a separate
application for Offer Shares, either by way of an Application Form or through an Electronic
Application, the Company, the Vendors, the Sponsor and Underwriter and the Placement
Agent shall have the discretion to either (i) reject both of such separate application or (ii)
accept any one or both of such separate applications.
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ACCEPTANCE
Conversely, if you have made an application for Offer Shares either by way of an Application
Form or through an Electronic Application, and you have also made a separate application
for Placement Shares, the Company, the Vendors, the Sponsor and Underwriter and
the Placement Agent shall have the discretion to either (i) reject both of such separate
application or (ii) accept any one or both of such separate applications.
Joint applications shall be rejected. Multiple applications for Invitation Shares shall be
liable to be rejected at the discretion of our Company, the Vendors and the Sponsor and
Underwriter. If you submit or procure submissions of multiple share applications for Offer
Shares, Placement Shares or both Offer Shares and Placement Shares, you may be deemed
to have committed an offence under the Penal Code, Chapter 224 of Singapore and the SFA,
and your applications may be referred to the relevant authorities for investigation. Multiple
applications or those appearing to be or suspected of being multiple applications may be
rejected at the discretion of our Company, the Vendors, the Sponsor and Underwriter and
the Placement Agent.
4. We will not accept applications from any person under the age of 18 years, undischarged
bankrupts, sole-proprietorships, partnerships, chops or non-corporate bodies, joint Securities
Account holders of CDP and from applicants whose addresses (furnished in their Application
Forms or, in the case of Electronic Applications, contained in the records of the relevant
Participating Banks) bear post ofce box numbers. No person acting or purporting to act on behalf
of a deceased person is allowed to apply under the Securities Account with CDP in the name of
the deceased at the time of the application.
5. We will not recognise the existence of a trust. An application by a trustee or trustees must therefore
be made in his/her/their own name(s) and without qualication.
6. WE WILL ACCEPT APPLICATIONS FROM APPROVED NOMINEE COMPANIES ONLY
FOR APPLICATIONS OTHER THAN IN THE APPLICANTS OWN NAME. Approved nominee
companies are dened as banks, merchant banks, nance companies, insurance companies,
licensed securities dealers in Singapore and nominee companies controlled by them. Applications
made by nominees other than approved nominee companies shall be rejected.
7. IF YOU ARE NOT AN APPROVED NOMINEE COMPANY, YOU MUST MAINTAIN A SECURITIES
ACCOUNT WITH CDP IN YOUR OWN NAME AT THE TIME OF YOUR APPLICATION. If you do
not have an existing Securities Account with CDP in your own name at the time of your application,
your application will be rejected (if you apply by way of an Application Form), or you will not be able
to complete your Electronic Application (if you apply by way of an Electronic Application). If you
have an existing Securities Account with CDP but fail to provide your Securities Account number
or provide an incorrect Securities Account number in the Application Form or in your Electronic
Application, as the case may be, your application is liable to be rejected. Subject to paragraph 8
below, your application shall be rejected if your particulars such as name, NRIC/passport number,
nationality and permanent residence status provided in your Application Form or in the records of
the relevant Participating Bank at the time of your Electronic Application, as the case may be, differ
from those particulars in your Securities Account as maintained with CDP. If you possess more
than one individual direct Securities Account with CDP, your application shall be rejected.
8. If your address as stated in the Application Form or, in the case of an Electronic
Application, contained in the records of the relevant Participating Bank, as the case may
be, is different from the address registered with CDP, you must inform CDP of your updated
address promptly, failing which the notication letter on successful allotment and other
correspondence from CDP will be sent to your address last registered with CDP.
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ACCEPTANCE
9. Our Company and the Vendors, in consultation with the Sponsor and Underwriter and the
Placement Agent, reserve the right to reject any application which does not conform strictly
to the instructions set out in the Application Form and in this Offer Document or which
does not comply with the instructions for Electronic Applications or with the terms and
conditions of this Offer Document or, in the case of an application by way of an Application
Form, which is illegible, incomplete, incorrectly completed or which is accompanied by an
improperly drawn remittance or improper form of remittance.
Our Company and the Vendors further reserve the right to treat as valid any applications not
completed or submitted or effected in all respects in accordance with the instructions set
out in the Application Forms or the instructions for Electronic Applications or the terms and
conditions of this Offer Document and also to present for payment or other processes all
remittances at any time after receipt and to have full access to all information relating to, or
deriving from, such remittances or the processing thereof.
Without prejudice to the rights of the Company and the Vendors and the Sponsor and
Underwriter and the Placement Agent, as agents of the Company and the Vendors, have
been authorised to accept, for and on behalf of the Company and the Vendors such other
forms of application as the Sponsor and Underwriter and the Placement Agent deems
appropriate.
10. Our Company and the Vendors, in consultation with the Sponsor and Underwriter, reserve the right
to reject or to accept, in whole or in part, or to scale down or to ballot any application, without
assigning any reason therefor, and no enquiry and/ or correspondence on the decision of our
Company and the Vendors will be entertained. This right applies to applications made by way of
Application Forms and by way of Electronic Applications. In deciding the basis of allotment which
shall be at the discretion of our Company and the Vendors, due consideration will be given to the
desirability of allotting the Invitation Shares to a reasonable number of Applicants with a view to
establishing an adequate market for the Shares.
11. Share certicates will be registered in the name of CDP and will be forwarded only to CDP at your
own risk. It is expected that CDP will send to you, at your own risk, within 15 Market Days after
the close of the Invitation, a statement of account stating that your Securities Account has been
credited with the number of Invitation Shares allotted and/ or allocated to you, if your application
is successful. This will be the only acknowledgement of application monies received and is not
an acknowledgement by our Company and Vendors. You irrevocably authorise CDP to complete
and sign on your behalf, as transferee or renouncee, any instrument of transfer and/ or other
documents required for the issue or transfer of the Invitation Shares allotted and/ or allocated to
you. This authorisation applies to applications made by way of Application Forms and by way of
Electronic Applications.
12. In the event that our Company lodges a supplementary or replacement offer document (Relevant
Document) pursuant to the SFA or any applicable legislation in force from time to time prior to the
close of the Invitation and the Invitation Shares have not been issued, we (as well as on behalf of
the Vendors) will (as required by law and subject to the SFA), at our Companys sole and absolute
discretion, either:
(i) within two (2) days (excluding any Saturday, Sunday or public holiday) from the date of the
lodgment of the Relevant Document give you notice in writing of how to obtain, or arrange
to receive, a copy of the same and provide you with an option to withdraw your application
and take all reasonable steps to make available within a reasonable period the Relevant
Document to you if you have indicated that you wish to obtain, or have arranged to receive, a
copy of the Relevant Document;

(ii) within seven (7) days of the lodgment of the Relevant Document give you a copy of the
Relevant Document and provide you with an option to withdraw your application; or
(iii) deem your application as withdrawn and cancelled and refund your application monies
(without interest or any share of revenue or other benet arising therefrom) to you within
seven (7) days from the lodgment of the Relevant Document.
G-4
ACCEPTANCE
Where you have notied us within 14 days from the date of lodgment of the Relevant Document of
your wish to exercise your option under paragraph 12(i) or (ii) above to withdraw your application,
we (as well as on behalf of the Vendors) shall pay to you all monies paid by you on account of your
application for the Invitation Shares without interest or any share of revenue or other benet arising
therefrom and at your own risk, within seven (7) days from the receipt of such notication.
In the event that at any time at the time of the lodgment of the Relevant Document, the Invitation
Shares have already been issued and/ or sold but trading has not commenced, we (as well as on
behalf of the Vendors) will (as required by law and subject to the SFA), at our Companys sole and
absolute discretion, either:-
(iv) within two (2) days (excluding Saturday, Sunday or public holiday) from the date of the
lodgement of the Relevant Document, give you notice in writing of how to obtain, or arrange
to receive, a copy of the same and provide you with an option to return the Invitation Shares
which you do not wish to retain title in and take all reasonable steps to make available within
a reasonable period the Relevant Document to you if you have indicated that you wish to
obtain, or have arranged to receive, a copy of the Relevant Document;
(v) within seven (7) days from the lodgment of the Relevant Document give you a copy of the
Relevant Document and provide you with an option to return the Invitation Shares; or
(vi) deem the issue or sale of the Invitation Shares as void and refund your payment for the
Invitation Shares (without interest or any share of revenue or other benet arising therefrom)
within seven (7) days from the lodgment of the Relevant Document.
Any applicant who wishes to exercise his option under paragraph 12(iv) or (v) above to return the
Invitation Shares issued to him shall, within 14 days from the date of lodgment of the Relevant
Document, notify us of this and return all documents, if any, purporting to be evidence of title of
those Invitation Shares, whereupon we (as well as on behalf of the Vendors) shall, within seven (7)
days from the receipt of such notication and documents, pay to him all monies paid by him for the
Invitation Shares without interest or any share of revenue or other benet arising therefrom and at
his own risk, and the Invitation Shares issued to him shall be void.
Additional terms and instructions applicable upon the lodgment of the Relevant Document,
including instructions on how you can exercise the option to withdraw your application or return the
Invitation Shares allotted and/ or allocated to you, may be found in such Relevant Document.
13. In the event of an under-subscription for Offer Shares as at the close of the Invitation, that number
of Offer Shares under-subscribed shall be made available to satisfy applications for Placement
Shares to the extent that there is an over-subscription for Placement Shares as at the close of the
Invitation.

In the event of an over-subscription for Offer Shares as at the close of the Invitation and/ or
Placement Shares are fully subscribed or over-subscribed as at the close of the Invitation, the
successful applications for Offer Shares will be determined by ballot or otherwise as determined by
our Company and the Vendors, after consultation with the Sponsor and Underwriter, and approved
by the SGX-ST, if required.
In all the above instances, the basis of allotment of the Invitation Shares as may be decided by our
Directors and the Vendors in ensuring a reasonable spread of shareholders of our Company, shall
be made public, as soon as practicable, through a SGXNET announcement to be posted on the
internet at the SGX-STs website at http://www.sgx.com and by advertisement in a local English
newspaper.
G-5
ACCEPTANCE
14. You consent to the disclosure of you name, NRIC/passport number, address, nationality,
permanent resident status, Securities Account number, CPF Investment Account number (if
applicable) and share application amount from your account with the relevant Participating Bank
to the Registrar for the Invitation and Singapore Share Transfer Agent, SCCS, SGX-ST, CDP,
our Company, the Vendors, the Sponsor, Underwriter and the Placement Agent. You irrevocably
authorise CDP to disclose the outcome of your application, including the number of Invitation
Shares allotted and/ or allocated to you pursuant to your application, to us, the Vendors, the
Sponsor and Underwriter, the Placement Agent and any other parties so authorised by the forgoing
persons. CDP shall not be liable for any delays, failures or inaccuracies in the recording, storage or
transmission or delivery of data relating to Electronic Applications.
15. Any reference to you or the Applicant in this section shall include an individual, a corporation,
an approved nominee and trustee applying for the Offer Shares by way of an Application Form
or by way of an Electronic Application and a person applying for the Placement Shares by way
of a Placement Shares Application Form or such other forms of application as the Sponsor and
Underwriter and Placement Agent deem appropriate.
16. By completing and delivering an Application Form or by making and completing an Electronic
Application by (in the case of an ATM Electronic Application) pressing the Enter or OK or
Conrm or Yes or any other relevant key on the ATM (as the case may be) or by (in the case of
an Internet Electronic Application) clicking Submit or Continue or Yes or Conrm or any other
relevant button on the IB website screen (as the case may be) in accordance with the provisions of
this Offer Document, you:
(a) irrevocably agree and undertake to subscribe for and/ or purchase the number of Invitation
Shares specied in your application (or such smaller number for which the application is
accepted) at the Invitation Price and agree that you will accept such Invitation Shares as
may be allotted and/ or allocated to you, in each case on the terms of, and subject to the
conditions set out in this Offer Document and the Memorandum and Articles of Association
of our Company;
(b) agree that, in the event of any inconsistency between the terms and conditions for
application set out in this Offer Document and those set out in the ATMs or IB websites of
the Participating Banks, the terms and conditions set out in this Offer Document shall prevail;
(c) agree that the aggregate Invitation Price for the Invitation Shares applied for is due and
payable to our Company and Vendors upon application; and
(d) warrant the truth and accuracy of the information contained, and representations and
declarations made in your application, and acknowledge and agree that such information,
representations and declarations will be relied on by our Company and Vendors in
determining whether to accept your application and/ or whether to allot and/ or allocate any
Invitation Shares to you; and
(e) agree and warrant that, if the laws of any jurisdictions outside Singapore are applicable
to your application, you have complied with all such laws and none of our Company, the
Vendors, the Sponsor and Underwriter, and the Placement Agent will infringe any such laws
as a result of the acceptance of your application.
17. Our acceptance of applications will be conditional upon, inter alia, our Company, the Vendors, the
Sponsor and Underwriter and the Placement Agent being satised that:
(a) permission has been granted by the SGX-ST to deal in and for quotation for all our existing
Shares (including Vendor Shares), New Shares and the Shares which may be issued under
the AsiaPhos Performance Share Plan on Catalist;
G-6
ACCEPTANCE
(b) the Management and Underwriting Agreement and the Placement Agreement referred to in
the section entitled Management, Underwriting and Placement Arrangements of this Offer
Document, have become unconditional and have not been terminated; and
(c) the SGX-ST acting as agent on behalf of the Authority has not served a Stop Order under
the SFA.
18. Where the SGX-ST acting as agent on behalf of the Authority issued a Stop Order pursuant to
Section 242 of the SFA and applications to subscribe for and/ or purchase the Invitation Shares to
which this Offer Document relates have been made prior to the Stop Order, and:
(a) where the Invitation Shares have not been issued and/ or sold to the applicants, the
applications shall be deemed to have been withdrawn and cancelled and our Company (as
well as on behalf of the Vendors) shall, within 14 days from the date of the Stop Order, pay
to the applicants all monies the applicants have paid on account of their applications for the
Invitation Shares; or
(b) where the Invitation Shares have been issued and/ or sold to the applicants, the SFA
provides that the issue and/ or sale of the Invitation Shares shall be deemed to be void and
our Company (as well as on behalf of the Vendors) shall, within 14 days from the date of the
Stop Order, pay to the applicants all monies the applicants have paid on account of their
applications for the Invitation Shares.
Such monies paid in respect of your application will be returned to you at your own risk, without
interest or any share or revenue or other benet arising therefrom, and you will not have any claim
against us, the Vendors, the Sponsor and Underwriter and the Placement Agent.
This shall not apply where only an interim Stop Order has been served.
19. In the event that an interim Stop Order in respect of the Invitation Shares is served by the SGX-ST
acting as agent on behalf of the Authority or other competent authority, no Invitation Shares shall
be issued and/ or sold to you until the SGX-ST acting as agent on behalf of the Authority revokes
the interim Stop Order.
20. The SGX-ST acting as agent on behalf of the Authority or other competent authority is not able
to serve a Stop Order in respect of the Invitation Shares if the Invitation Shares have been issued
and/ or sold and listed on a securities exchange and trading in them has commenced.
21. In the event of any changes in the closure of the Invitation or the time period during which the
Invitation is open, we will publicly announce the same through a SGXNET announcement to
be posted on the Internet at the SGX-ST website (http://www.sgx.com) and in a local English
newspaper such as The Straits Times or The Business Times.
22. Our Company and the Vendors will not hold any application in reserve.
23. Our Company and the Vendors will not allot and/ or allocate shares on the basis of this Offer
Document later than six (6) months after the date of registration of this Offer Document by the
SGX-ST, acting on behalf of the Authority.
24. Additional terms and conditions for applications by way of Application Forms are set out in the
section entitled Additional Terms and Conditions for Applications Using Application Forms of this
Appendix G.
25. Additional terms and conditions for applications by way of Electronic Applications are set out in the
section entitled Additional Terms and Conditions for Electronic Applications of this Appendix G.
G-7
ACCEPTANCE
26. CDP shall not be liable for any delays, failures or inaccuracies in the recording storage or in the
transmission or delivery of data recovering to Electronic Applications.
27. All payments in respect of any application for Invitation Shares and any refund, shall be made in
Singapore dollars.
28. Where monies are to be returned to you for the Invitation Share, it shall be paid to you without any
interest or share of revenue or other benet arising therefrom at your own risk, and you will not have
any claim against us, the Vendors, the Sponsor and Underwriter or the Placement Agent.
29. No person in any jurisdiction outside Singapore receiving this Offer Document or its accompanying
documents (including Application Forms) may treat the same as an offer or invitation to subscribe
or purchase any Invitation Shares unless such offer or invitation could lawfully be made without
compliance with any regulatory requirements in those jurisdiction.
ADDITIONAL TERMS AND CONDITIONS FOR APPLICATIONS USING APPLICATION FORMS
Applications by way of an Application Form shall be made on, and subject to, the terms and conditions
of this Offer Document including but not limited to the terms and conditions appearing below as well
as those set out under the section entitled TERMS, CONDITIONS AND PROCEDURES FOR
APPLICATION AND ACCEPTANCE of this Offer Document, as well as the Memorandum and Articles of
Association of our Company.
1. Your application must be made using the WHITE Application Forms and WHITE ofcial envelopes
A and B for Offer Shares or the BLUE Application Forms for Placement Shares or such other
forms of application as the Sponsor and Underwriter and the Placement Agent deem appropriate
accompanying and forming part of this Offer Document. We draw your attention to the detailed
instructions contained in the respective Application Forms and this Offer Document for the
completion of the Application Forms which must be carefully followed. Our Company and the
Vendors, in consultation with the Sponsor and Underwriter and the Placement Agent,
reserve the right to reject applications which do not conform strictly to the instructions set
out in the Application Forms and this Offer Document or to the terms and conditions of
this Offer Document or which are illegible, incomplete, incorrectly completed or which are
accompanied by improperly drawn remittances or improper form of remittance.
2. Your Application Forms must be completed in English. Please type or write clearly in ink using
BLOCK LETTERS.
3. All spaces in the Application Forms except those under the heading FOR OFFICIAL USE ONLY
must be completed and the words NOT APPLICABLE or N.A. should be written in any space
that is not applicable.
4. Individuals, corporations and approved nominee companies must give their names in full. If you
are an individual, you must make your application using your full names as it appears in your
identity cards (if you have such an identication document) or in your passports and, in the case
of a corporation, in your full name as registered with a competent authority. If you are not an
individual, you must complete the Application Form under the hand of an ofcial who must state
the name and capacity in which he signs the Application Form. If you are a corporation completing
the Application Form, you are required to afx your Common Seal (if any) in accordance with your
Memorandum and Articles of Association or equivalent constitutive documents of the corporation. If
you are a corporate applicant and your application is successful, a copy of your Memorandum and
Articles of Association or equivalent constitutive documents must be lodged with our Companys
Share Registrar. Our Company and the Vendors reserve the right to require you to produce
documentary proof of identication for verication purposes.
G-8
ACCEPTANCE
5. (a) You must complete Sections A and B and sign page 1 of the Application Form.
(b) You are required to delete either paragraph 7(a) or 7(b) on page 1 of the Application Form.
Where paragraph 7(a) is deleted, you must also complete Section C of the Application
Forms with particulars of the benecial owner(s).
(c) If you fail to make the required declaration in paragraph 7(a) or 7(b), as the case may be, on
page 1 of the Application Form, your application is liable to be rejected.
6. Your application must be accompanied by a remittance in Singapore currency for the full amount
payable, in respect of the number of Invitation Shares applied for, in the form of a BANKERS
DRAFT or CASHIERS ORDER drawn on a bank in Singapore, made out in favour of ASIAPHOS
SHARE ISSUE ACCOUNT crossed A/C PAYEE ONLY, and with your name and address
written clearly on the reverse side. Applications not accompanied by any payment or accompanied
by ANY OTHER FORM OF PAYMENT WILL NOT BE ACCEPTED. We will reject remittances
bearing NOT TRANSFERABLE or NON TRANSFERABLE crossings. We reserve the right to
reject any application which is accompanied by combined Bankers Draft or Cashiers Order for
different CDP Securities Accounts. No acknowledgement or receipt will be issued by our Company,
the Vendors, the Sponsor and Underwriter or the Placement Agent for applications and application
monies received.
7. Monies paid in respect of unsuccessful applications are expected to be returned (without interest
or any share of revenue or other benet arising therefrom) to you by ordinary post within 24 hours
of balloting of applications at your own risk. Where your application is rejected or accepted in part
only, the full amount or the balance of the application monies received, as the case may be, will
be refunded (without interest or any share of revenue or other benet arising therefrom) to you
by ordinary post at your own risk within 14 days after the close of the Invitation. In the event that
the Invitation is cancelled by us (as well as on behalf of the Vendors) following the issuance of a
Stop Order by the SGX-ST acting as agent on behalf of the Authority or for any other reason, the
application monies received will be refunded (without interest or any share of revenue or other
benet arising therefrom) to you by ordinary post or telegraphic transfer at your own risk within 14
days from the date of the Stop Order or the termination of the Invitation (as the case may be).
8. Capitalised terms used in the Application Forms and dened in this Offer Document shall bear the
meanings assigned to them in this Offer Document.
9. By completing and delivering the Application Form, you agree that:
(a) in consideration of our Company and the Vendors having distributed the Application Form
to you and agreeing to close the List at 12.00 noon on 3 October 2013 or such other
time or date as our Company and the Vendors may, in consultation with the Sponsor and
Underwriter and the Placement Agent, decide and by completing and delivering the
Application Form:
(i) your application is irrevocable; and
(ii) your remittance will be honoured on rst presentation and that any monies returnable
may be held pending clearance of your payment without interest or any share of
revenue or other benet arising therefrom;
(b) all applications, acceptances and contracts resulting therefrom under the Invitation shall
be governed by and construed in accordance with the laws of Singapore and that you
irrevocably submit to the non-exclusive jurisdiction of the Singapore courts;
(c) in respect of the Invitation Shares for which your application has been received and not
rejected, acceptance of your application shall be constituted by written notication and not
otherwise, notwithstanding any remittance being presented for payment by or on behalf of
our Company;
G-9
ACCEPTANCE
(d) you will not be entitled to exercise any remedy of rescission for misrepresentation at any
time after acceptance of your application;
(e) in making your application, reliance is placed solely on the information contained in this Offer
Document and that none of our Company, the Vendors, the Sponsor and Underwriter, the
Placement Agent or any other person involved in the Invitation shall have any liability for any
information not so contained;
(f) you consent to the disclosure of your name, NRIC/passport number, address, nationality,
permanent resident status, Securities Account number, and share application amount to
our Share Registrar, CDP, SCCS, SGX-ST, our Company, the Vendors, the Sponsor and
Underwriter, the Placement Agent or other authorised operators; and
(g) you irrevocably agree and undertake to subscribe for and/ or purchase the number of
Invitation Shares applied for as stated in the Application Form or any smaller number of such
Invitation Shares that may be allotted and/ or allocated to you in respect of your application.
In the event that our Company and the Vendors decide to allot and/ or allocate a smaller
number of Invitation Shares or not to allot and/ or allocate any Invitation Shares to you, you
agree to accept such decision as nal.
Applications for Offer Shares
1. Your application for Offer Shares MUST be made using the WHITE Offer Shares Application Forms
and WHITE ofcial envelopes A and B. ONLY ONE APPLICATION should be enclosed in each
envelope.
2. You must:
(a) enclose the WHITE Offer Shares Application Form, duly completed and signed, together with
the correct remittance in accordance with the terms and conditions of this Offer Document in
the WHITE envelope A provided;
(b) in the appropriate spaces on WHITE envelope A:
(i) write your name and address;
(ii) state the number of Offer Shares applied for;
(iii) tick the relevant box to indicate the form of payment; and
(iv) afx adequate Singapore postage;
(c) SEAL WHITE ENVELOPE A;
(d) write, in the special box provided on the larger WHITE envelope B addressed to
ASIAPHOS LIMITED c/o Boardroom Corporate & Advisory Services Pte. Ltd., 50
Rafes Place, Singapore Land Tower #32-01, Singapore 048623, the number of Offer
Shares you have applied for; and
(e) insert WHITE envelope A into WHITE envelope B, seal WHITE envelope B and
thereafter DESPATCH BY ORDINARY POST OR DELIVER BY HAND at your own risk
to ASIAPHOS LIMITED c/o Boardroom Corporate & Advisory Services Pte. Ltd.,
50 Rafes Place, Singapore Land Tower #32-01, Singapore 048623, to arrive by 12.00
noon on 3 October 2013 or such other time as our Company and the Vendors may, in
consultation with the Sponsor and Underwriter, in their absolute discretion, decide.
Local Urgent Mail or Registered Post must NOT be used.
G-10
ACCEPTANCE
3. Applications that are illegible, incomplete or incorrectly completed or accompanied by improperly
drawn remittances or improper form of remittance or which are not honoured upon their rst
presentation are liable to be rejected.
4. ONLY ONE APPLICATION should be enclosed in each envelope. No acknowledgement of receipt
will be issued for any application or remittance received.
Applications for Placement Shares
1. Your application for Placement Shares MUST be made using the BLUE Placement Shares
Application Forms or other such forms of application as the Sponsor and Underwriter and the
Placement Agent deem appropriate. ONLY ONE APPLICATION should be enclosed in each
envelope.
2. The completed BLUE Placement Shares Application Form and the correct remittance in full in
respect of the number of Placement Shares applied for (in accordance with the terms and
conditions of this Offer Document) with your name and address written clearly on the reverse
side, must be enclosed and sealed in an envelope to be provided by you. The sealed envelope
must be DESPATCHED BY ORDINARY POST OR DELIVERED BY HAND at your own risk to
ASIAPHOS LIMITED c/o Asiasons WFG Capital Pte. Ltd., 22 Cross Street, #03-54/61 China
Square Central, Singapore 048421, to arrive by 12.00 noon on 3 October 2013 or such
other time as our Company and the Vendors may, in consultation with the Sponsor and
Underwriter and the Placement Agent, in their absolute discretion, decide. Local Urgent Mail
or Registered Post must NOT be used. No acknowledgement of receipt will be issued for any
application or remittance received.
3. Applications that are illegible, incomplete or incorrectly completed or accompanied by improperly
drawn remittances or improper form of remittance or which are not honoured upon their rst
presentation are liable to be rejected.
ADDITIONAL TERMS AND CONDITIONS FOR ELECTRONIC APPLICATIONS
The procedures for Electronic Applications are set out on the ATM screens (in the case of ATM Electronic
Applications) and the IB website screens (in the case of Internet Electronic Applications) of the relevant
Participating Banks. Currently, UOB and its subsidiary, Far Eastern Bank Limited (UOB Group), OCBC
Bank and DBS Bank (including POSB), are the only Participating Banks through which Internet Electronic
Applications can be made. For illustration purposes, the procedures for Electronic Applications through
ATMs and the IB website of UOB are set out respectively in the Steps for Electronic Applications through
ATMs of UOB and the Steps for Internet Electronic Applications through the Internet Banking website
of UOB (collectively, the Steps) in this Appendix G. The Steps set out the actions that you must take
at an ATM or the IB website of UOB to complete an Electronic Application. Please read carefully the
terms of this Offer Document, the Steps and the terms and conditions for Electronic Applications set out
below before making an Electronic Application. Any reference to you or the applicant in this section
Additional Terms and Conditions for Electronic Applications and the Steps shall refer to you making an
application for Offer Shares through an ATM or the IB website of a relevant Participating Bank.
Applicants applying for the Offer Shares by way of Electronic Applications may incur an administrative fee
and/ or such related charges as stipulated by the respective Participating Banks from time to time.
You must have an existing bank account with and be an ATM cardholder of one of the Participating Banks
before you can make an Electronic Application at the ATMs. An ATM card issued by one Participating
Bank cannot be used to apply for Offer Shares at an ATM belonging to other Participating Banks. For an
Internet Electronic Application, you must have an existing bank account with and an IB User Identication
(User ID) and a Personal Identication Number/Password (PIN) given by the relevant Participating
Bank. The Steps set out the actions that you must take at ATMs or the IB website of UOB to complete an
Electronic Application. The actions that you must take at ATMs or the IB websites of other Participating
G-11
ACCEPTANCE
Banks are set out on the ATM screens or the IB website screens of the relevant Participating Banks.
Upon the completion of your ATM Electronic Application transaction, you will receive an ATM transaction
slip (Transaction Record), conrming the details of your Electronic Application. Upon completion of
your Internet Electronic Application through the IB website of UOB Group, there will be an on-screen
conrmation (Conrmation Screen) of the application which can be printed for your record. The
Transaction Record or your printed record of the Conrmation Screen is for your retention and should not
be submitted with any Application Form.
You must ensure that you enter your own Securities Account number when using the ATM card
issued to you in your own name. If you fail to use your own ATM card or if you do not key in
your own Securities Account number, your application will be rejected. If you operate a joint bank
account with any of the Participating Banks, you must ensure that you enter your own Securities
Account number when using the ATM card issued to you in your own name. Using your own
Securities Account number with an ATM card which is not issued to you in your own name will
render your ATM Electronic Application liable to be rejected.
You must ensure, when making an Internet Electronic Application, that your mailing address for the
account selected for the application is in Singapore and the application is being made in Singapore and
you will be asked to declare accordingly. Otherwise your application is liable to be rejected.
You shall make an Electronic Application in accordance with and subject to the terms and conditions of
this Offer Document including but not limited to the terms and conditions appearing below and those set
out under this Appendix G entitled TERMS, CONDITIONS AND PROCEDURES FOR APPLICATION
AND ACCEPTANCE to this Offer Document as well as the Memorandum and Articles of Association of
our Company.
1. In connection with your Electronic Application for Offer Shares, you are required to conrm
statements to the following effect in the course of activating your Electronic Application:
(a) that you have received a copy of this Offer Document and have read, understood and
agreed to all the terms and conditions of application for Offer Shares and this Offer
Document prior to effecting the Electronic Application and agree to be bound by the
same;
(b) that you consent to the disclosure of your name, NRIC/passport number, address,
nationality, permanent residence status, share application amount, CPF Investment
Account number (if applicable) and Securities Account number and application
details (the Relevant Particulars) with the relevant Participating Bank to CDP, CPF,
SCCS, the SGX-ST, the Share Registrar, our Company, the Vendors, the Sponsor
and Underwriter, the Placement Agent or other authorised operators (the Relevant
Parties); and
(c) that this is your only application for Offer Shares and it is made in your own name and
at your own risk.
Your application will not be successfully completed and cannot be recorded as a completed
transaction in the ATM or on the IB website unless you press the Enter or Conrm or Yes or
OK or any other relevant key in the ATM or click Conrm or OK or Submit or Continue or
Yes or any other relevant button on the IB website screen. By doing so, you shall be treated as
signifying your conrmation of each of the above three (3) statements. In respect of statement
1(b) above, such conrmation, shall signify and shall be treated as your written permission,
given in accordance with the relevant laws of Singapore including Section 47(2) of the Banking
Act, Chapter 19 of Singapore, to the disclosure by the relevant Participating Bank of the Relevant
Particulars to the Relevant Parties.
G-12
ACCEPTANCE
2. BY MAKING AN ELECTRONIC APPLICATION, YOU CONFIRM THAT YOU ARE NOT
APPLYING FOR OFFER SHARES AS A NOMINEE OF ANY OTHER PERSON AND THAT ANY
ELECTRONIC APPLICATION THAT YOU MAKE IS THE ONLY APPLICATION MADE BY YOU AS
THE BENEFICIAL OWNER.
YOU SHOULD MAKE ONLY ONE ELECTRONIC APPLICATION FOR OFFER SHARES AND
SHOULD NOT MAKE ANY OTHER APPLICATION FOR OFFER OR PLACEMENT SHARES,
WHETHER AT THE ATMS OR THE IB WEBSITES (IF ANY) OF ANY PARTICIPATING BANK
OR ON THE APPLICATION FORMS. IF YOU HAVE MADE AN APPLICATION FOR OFFER
OR PLACEMENT SHARES ON AN APPLICATION FORM, YOU SHALL NOT MAKE AN
ELECTRONIC APPLICATION FOR OFFER SHARES AND VICE VERSA.
3. You must have sufcient funds in your bank account with your Participating Bank at the time you
make your Electronic Application, failing which your Electronic Application will not be completed or
accepted. Any Electronic Application which does not conform strictly to the instructions set
out in this Offer Document or on the screens of the ATM or the IB website of the relevant
Participating Bank through which your Electronic Application is being made shall be
rejected.
You may make an ATM Electronic Application at the ATM of any Participating Bank or an Internet
Electronic Application at the IB website of the relevant Participating Bank for the Offer Shares
using only cash by authorising such Participating Bank to deduct the full amount payable from your
account with such Participating Bank.
4. You irrevocably agree and undertake to subscribe for and/ or purchase and to accept the number
of Offer Shares applied for as stated on the Transaction Record or the Conrmation Screen or
any lesser number of Offer Shares that may be allotted and/ or allocated to you in respect of your
Electronic Application. In the event that our Company and the Vendors decide to allot and/ or
allocate any lesser number of such Offer Shares or not to allot any Offer Shares to you, you agree
to accept such decision as nal. If your Electronic Application is successful, your conrmation (by
your action of pressing the Enter or Conrm or Yes or OK or any other relevant key on the
ATM or clicking Conrm or OK or Submit or Continue or Yes or any other relevant button on
the IB website screen) of the number of Offer Shares applied for shall signify and shall be treated
as your acceptance of the number of Offer Shares that may be allotted and/ or allocated to you and
your agreement to be bound by the Memorandum and Articles of Association of our Company.
5. Our Company and the Vendors will not keep any applications in reserve. Where your
Electronic Application is unsuccessful, the full amount of the application monies will be refunded in
Singapore currency (without interest or any share of revenue or other benet arising therefrom) to
you by being automatically credited to your account with your Participating Bank within 24 hours of
balloting of the applications provided that the remittance in respect of such application which has
been presented for payment or other processes have been honoured and the application monies
have been received in the designated Share issue account.
Where your Electronic Application is rejected or accepted in part only, the full amount or the
balance of the application monies, as the case may be, will be refunded in Singapore currency
(without interest or any share of revenue or other benet arising therefrom) to you by being
automatically credited to your account with your Participating Bank within 14 days after the close of
the Invitation provided that the remittance in respect of such application which has been presented
for payment or other processes have been honoured and the application monies have been
received in the designated Share issue account.
In the event the Invitation is cancelled by us (as well as on behalf of the Vendors) following the
issuance of a Stop Order by the Authority, the SGX-ST acting as agent on behalf of the Authority
or any other relevant authorities for any other reason, the application monies received will
be refunded (without interest or any share of revenue or other benet arising therefrom) to you
automatically crediting your account with your Participating Bank at your own risk within 14 days
from the date of the Stop Order or the termination of the Invitation (as the case may be).
G-13
ACCEPTANCE
Responsibility for timely refund of application monies from unsuccessful or partially
successful Electronic Applications lies solely with the respective Participating Banks.
Therefore, you are strongly advised to consult your Participating Bank as to the status of
your Electronic Application and/ or the refund of any monies to you from unsuccessful or
partially successful Electronic Application, to determine the exact number of Offer Shares
allotted and/ or allocated to you before trading the Offer Shares on the SGX-ST. To nd out
if you have been allotted and/ or allocated Shares for the Invitation, you may login to the
SGX-ST website at www.sgx.com using your Internet PIN to check your share balances.
Alternatively, you may call CDP at 6535 7511 using your Telephone PIN. To sign up for both
services, applicants may download the forms from the SGX-ST website or contact CDPs
customer service ofcers for a copy. Neither the SGX-ST, CDP, the SCCS, the Participating
Banks, our Company, the Vendors, the Sponsor and Underwriter, nor the Placement Agent
assume any responsibility for any loss that may be incurred as a result of you having to
cover any net sell positions or from buy-in procedures activated by the SGX-ST.
6. If your Electronic Application is unsuccessful, no notication will be sent by the Participating Banks.
If you make Electronic Applications through the ATMs of the following Participating Banks, you may
check the results of your Electronic Applications as follows:
Bank Telephone Available at ATM
Operating
hours
Service
expected from
UOB
Group 1800 222 2121
ATM (Other Transactions
IPO Results Enquiry)/
Phone Banking/Internet
Banking
(1)
http://www.uobgroup.com
(1)
24 hours a day Evening of the
balloting day
OCBC
Bank
1800 363 3333 ATM/Phone Banking/
Internet Banking
(2)
http://www.ocbc.com
(2) (3)

balloting day
DBS
Bank
1800 339 6666
(for POSB Account
holders)
1800 111 1111
(for DBS Account
holders)
Internet Banking
http://www.dbs.com
(4)
balloting day
Notes:
(1) If you make your Electronic Applications through the ATMs or IB website of UOB, you may check the results of your
application through UOB Personal Internet Banking, UOB Group ATMs or UOB Phone Banking Services.
(2) If you make your Electronic Applications through the ATMs or IB website of OCBC, you may check the results of your
application through OCBC Personal Internet Banking, OCBCs ATMs or OCBC Phone Banking Services.
(3) If you make your Internet Electronic Application through the IB website of OCBC, you may check the results of your
application through the same channels listed in the table above in relation to ATM Electronic Application made at
ATMs of OCBC.
(4) If you make your Electronic Application through the ATMs, IB website or mBanking interface of DBS, you may check
the results of your application through the DBS channels listed in the table above.
G-14
ACCEPTANCE
7. You irrevocably agree and acknowledge that your Electronic Application is subject to risks of
electrical, electronic, technical and computer-related faults and breakdowns, res, acts of God and
other events beyond the control of the Participating Banks, our Company, the Vendors, the Sponsor
and Underwriter, the Placement Agent and/ or any other party involved in the Invitation, and if, in
any such event, our Company, the Vendors, the Sponsor and Underwriter, the Placement Agent,
the relevant Participating Bank and/ or any other party involved in the Invitation do not receive
your Electronic Application, or data relating to your Electronic Application or the tape or any other
devices containing such data is lost, corrupted or not otherwise accessible, whether wholly or
partially for whatever reason, you shall be deemed not to have made an Electronic Application
and you shall have no claim whatsoever against our Company, the Vendors, the Sponsor and
Underwriter, the Placement Agent, the relevant Participating Bank and/ or any other party involved
in the Invitation for Offer Shares applied for or for any compensation, loss or damage.
8. Electronic Applications are expected to open at 12.30 p.m. on 26 September 2013 and close at
12.00 noon on 3 October 2013 or such other time as our Company and the Vendors may, in
consultation with the Sponsor and Underwriter and the Placement Agent, decide. Please note that
the timetable is indicative only and is subject to change (whether in relation to the Offer Shares,
Placement Shares or any mode of application thereof) at the discretion of our Company and the
Vendors, with the agreement of the Sponsor and Underwriter and the Placement Agent. Subject
to the paragraph above, an Internet Electronic Application is deemed to be received only upon its
completion, that is, when there is an on-screen conrmation of the application.
9. You are deemed to have irrevocably requested and authorised our Company to:
(a) register the Offer Shares allotted and/ or allocated to you in the name of CDP for deposit into
your Securities Account;
(b) send the relevant Share certicate(s) to CDP;
(c) return or refund (without interest or any share of revenue earned or other benet arising
therefrom) the application monies, should your Electronic Application be unsuccessful, by
automatically crediting your bank account with your Participating Bank with the relevant
amount within 24 hours of the balloting of applications; and
(d) return or refund (without interest or any share of revenue or other benet arising therefrom)
the balance of the application monies, should your Electronic Application be accepted in
part only, by automatically crediting your bank account with your Participating Bank with the
relevant amount within 14 days after the close of the Invitation.
10. We do not recognise the existence of a trust. Any Electronic Application by a trustee must be
made in your own name and without qualication. Our Company and the Vendors will reject any
application by any person acting as nominee except those made by approved nominee companies
only.
11. All your particulars in the records of your relevant Participating Bank at the time you make your
Electronic Application shall be deemed to be true and correct and your relevant Participating Bank
and the Relevant Parties shall be entitled to rely on the accuracy thereof. If there has been any
change in your particulars after the time of the making of your Electronic Application, you shall
promptly notify your relevant Participating Bank.
12. You should ensure that your personal particulars as recorded by both CDP and the relevant
Participating Bank are correct and identical, otherwise, your Electronic Application is liable
to be rejected. You should promptly inform CDP of any change in address, failing which the
notication letter on successful allotment will be sent to your address last registered with CDP.
G-15
ACCEPTANCE
13. By making and completing an Electronic Application, you are deemed to have agreed that:
(a) in consideration of our Company making available the Electronic Application facility, through
the Participating Banks as the agents of our Company, at the ATMs and IB websites (if any):
(i) your Electronic Application is irrevocable; and
(ii) your Electronic Application, our acceptance and the contract resulting therefrom
under the Invitation shall be governed by and construed in accordance with the
laws of Singapore and you irrevocably submit to the non-exclusive jurisdiction of the
Singapore courts;
(b) neither our Company, the Vendors, the Sponsor and Underwriter, the Placement Agent,
the Participating Banks nor any other party involved in the Invitation shall be liable for any
delays, failures or inaccuracies in the recording, storage or in the transmission or delivery
of data relating to your Electronic Application to us or CDP due to breakdowns or failure
of transmission, delivery or communication facilities or any risks referred to in paragraph 7
above or to any cause beyond our respective controls;
(c) in respect of Offer Shares for which your Electronic Application has been successfully
completed and not rejected, acceptance of your Electronic Application shall be constituted by
written notication by or on behalf of our Company and not otherwise, notwithstanding any
payment received by or on behalf of our Company;
(d) you will not be entitled to exercise any remedy of rescission for misrepresentation at any
time after acceptance of your application; and
(e) in making your application, reliance is placed solely on the information contained in this Offer
Document and that none of our Company, the Vendors, the Sponsor and Underwriter and
the Placement Agent or any other person involved in the Invitation shall have any liability for
any information not so contained.
Steps for Electronic Applications through ATMs and the IB website of UOB
The instructions for Electronic Applications will appear on the ATM screens and the IB website screens
of the respective Participating Banks. For illustrative purposes, the steps for making an Electronic
Application through UOBs ATMs or through the IB website of UOB are shown below. Instructions for
Electronic Applications appearing on the ATM screens and the IB website screens (if any) of the relevant
Participating Banks (other than UOB Group) may differ from that represented below.
Owing to space constraints on UOBs ATM screens, the following terms will appear in abbreviated form:
& : and
A/C and A/CS : ACCOUNT AND ACCOUNTS, respectively
ADDR : ADDRESS
AMT : AMOUNT
APPLN : APPLICATION
CDP : THE CENTRAL DEPOSITORY (PTE) LIMITED
CPF : CENTRAL PROVIDENT FUND BOARD
CPFINVT A/C : CPF INVESTMENT ACCOUNT
G-16
ACCEPTANCE
ESA : ELECTRONIC SHARE APPLICATION
IC/PSSPT : NRIC or PASSPORT NUMBER
NO or NO. : NUMBER
PERSONAL NO : PERSONAL IDENTIFICATION NUMBER
REGISTRARS : SHARE REGISTRARS
SCCS : SECURITIES CLEARING & COMPUTER SERVICES (PTE) LTD
TRANS : TRANSACTIONS
YR : YOUR
Steps for an ATM Electronic Application through ATMs of UOB
Step 1 : Insert your personal Unicard, Uniplus card or UOB VISA/MASTER card and key in your
personal identication number.
2 : Select CASHCARD/OTHER TRANSACTIONS.
3 : Select SECURITIES APPLICATION.
4 : Select the share counter which you wish to apply for.

5 : Read and understand the following statements which will appear on the screen:
- THIS OFFER OF SECURITIES (OR UNITS OF SECURITIES) WILL BE MADE IN,
OR ACCOMPANIED BY, A COPY OF THE PROSPECTUS/OFFER INFORMATION
STATEMENT/DOCUMENT OR SUPPLEMENTARY DOCUMENTS. ANYONE
WISHING TO ACQUIRE THESE SECURITIES (OR UNITS OF SECURITIES)
WILL NEED TO MAKE AN APPLICATION IN THE MANNER SET OUT IN
THE PROSPECTUS/OFFER INFORMATION STATEMENT/DOCUMENT OR
SUPPLEMENTARY DOCUMENT
(Customer to press ENTER to continue)
- PLEASE CALL 1800-22-22-121 IF YOU WOULD LIKE TO FIND OUT WHERE YOU
CAN OBTAIN A COPY OF THE PROSPECTUS/OFFER INFORMATION STATEMENT/
DOCUMENT OR SUPPLEMENTARY DOCUMENT
- WHERE APPLICABLE, A COPY OF THE PROSPECTUS/OFFER INFORMATION
STATEMENT/DOCUMENT OR SUPPLEMENTARY DOCUMENT HAS BEEN
LODGED WITH AND REGISTERED BY THE MONETARY AUTHORITY OF
SINGAPORE WHO ASSUMES NO RESPONSIBILITY FOR THE CONTENTS OF
THE PROSPECTUS/DOCUMENT OR SUPPLEMENTARY DOCUMENT
(Customer to press ENTER key to conrm that you have read and understood the
above statements)
6 : Read and understand the following terms which will appear on the screen:
- YOU HAVE READ, UNDERSTOOD & AGREED TO ALL TERMS OF THE
PROSPECTUS/ OFFER I NFORMATI ON STATEMENT/ DOCUMENT/
SUPPLEMENTARY DOCUMENT & THIS ELECTRONIC APPLICATION
G-17
ACCEPTANCE
- YOU CONSENT TO DISCLOSE YR NAME, IC/PASSPORT NUMBER, NATIONALITY,
ADDRESS, APPLICATION AMOUNT, CPF INVESTMENT ACCOUNT NUMBER &
CDP ACCOUNT NUMBER FROM YOUR ACCOUNTS TO CDP, CPF, SCCS, SHARE
REGISTRARS, SGX-ST & ISSUER/VENDOR(S)
- THIS IS YOUR ONLY FIXED PRICE APPLICATION & IS IN YOUR NAME & AT YOUR
RISK
(Customer to press ENTER to continue)
7 : Screen will display:
NRIC/Passport No. XXXXXXXXXXXX
IF YOUR NRIC NO / PASSPORT NO IS INCORRECT, PLEASE CANCEL THE
TRANSACTION AND NOTIFY THE BRANCH PERSONALLY.
(Customer to press CANCEL or CONFIRM)
8 : Select mode of payment i.e. CASH ONLY. You will be prompted to select Cash Account
type to debit (i.e., CURRENT ACCOUNT / I- ACCOUNT, CAMPUS OR SAVINGS
ACCOUNT / TX ACCOUNT). Should you have a few accounts linked to your ATM card, a list
of linked account numbers will be displayed for you to select
9 : After you have selected the account, your Securities Account number will be displayed for
you to conrm or change (This screen with your Securities Account number will be shown if
your Securities Account number is already stored in the ATM system of UOB). If this is the
rst time you are using UOBs ATM to apply for Shares, your Securities Account number will
not be stored in the ATM system of UOB, and the following screen will be displayed for your
input of your Securities Account number
10 : Read and understand the following terms which will appear on the screen:
1. YOU ARE REQUIRED TO ENTER YOUR CDP ACCOUNT NUMBER FOR YOUR
FIRST IPO/SECURITIES APPLICATION. THIS ACCOUNT NUMBER WOULD BE
DISPLAYED FOR FUTURE APPLICATIONS.
2. DO NOT APPLY FOR JOINT ACCOUNT HOLDER OR OTHER THIRD PARTIES.
3. PLEASE ENTER YOUR OWN CDP ACCOUNT NUMBER (12-DIGITS) & PRESS
ENTER.
4. IF YOU WISH TO TERMINATE THE TRANSACTION, PLEASE PRESS CANCEL.
11 : Key in your Securities Account number (12 digits) and press the ENTER key
12 : Select your nationality status
13 : Key in the number of Securities you wish to apply for and press the ENTER key
14 : Check the details of your Electronic Application on the screen and press ENTERkey to
conrm your Electronic Application
15 : Select NO if you do not wish to make any further transactions and remove the Transaction
Record. You should keep the Transaction Record for your own reference only
G-18
ACCEPTANCE
Steps for an Internet Electronic Application through the Internet Banking website of UOB
Owing to space constraints on UOBs IB website screens, the following terms will appear in abbreviated
form:
CDP : The Central Depository (Pte) Limited
CPF : The Central Provident Fund
PR : Permanent Resident
SGD or S$ : Singapore Dollars
SCCS : Securities Clearing & Computer Services (Pte) Ltd
SGX : Singapore Exchange Securities Trading Limited
Step 1 : Connect to UOBs website at http://www.uobgroup.com
2 : Locate the UOB Online Services Login icon on the top right hand sidenext to Internet
Banking
3 : Click on UOB Online Services Login and at drop list select UOB Personal Internet Banking
4 : Enter your Username and Password and click Submit
5 : Click on Proceed under the Full Access Mode
6 : You will receive a SMS One-Time Password. Enter the SMS One-Time Password and click
Proceed
7 : Click on EPS/Securities/CPFIS, follow by Securities, follow by Securities Application
8 : Read the IMPORTANT notice and complete the declarations found on the bottom of the
page by answering Yes/No to the questions
9 : Click Continue
10 : Select your country of residence (you must be residing in Singapore to apply), and click
Continue
11 : Select the Securities Counter from the drop list (if there are concurrent IPOs) and click
Submit
12 : Check the Securities Counter, select the mode of payment and account number to debit
and click on Submit
13 : Read the important instructions and click on Continue to conrm that:-
1. You have read, understood and agreed to all the terms of this application and
Prospectus/Offer Document or Supplementary Document.
2. You consent to disclose your name, I/C or passport number, address, nationality,
Securities Account number, CPF Investment Account number (if applicable), and
application details to the securities registrars, SGX, SCCS, CDP, CPF Board and
issuer/vendor(s).
G-19
ACCEPTANCE
3. This application is made in your own name, for your own account and at your
own risk.
4. For FIXED/MAX price securities application, this is your only application. For
Tender price shares application, this is your only application at the selected
tender price.
5. For FOREIGN CURRENCY securities, subject to the terms of the issue, please
note the following: The application monies will be debited from your bank
account in SGD, based on the Banks exchange prot or loss, or application
monies may be debited and refunds credited in SGD at the same exchange rate.
6. For 1st-Come-1st Serve securities, the number of securities applied for may be
reduced, subject to the availability at the point of application.
14 : Check your personal details, details of the share counter you wish to apply for and account
to debit:-
Select (a) Nationality;
Enter (b) your Securities Account Number; and
(c) the number of shares applied for
Click Submit
15 : Check the details of your application, your NRIC /Passport number, Securities Account
Number and the number of shares applied for, share counter, payment mode and account to
debit
16 : Click Conrm, Edit or Home as applicable
17 : Print the Conrmation Screen (optional) for your own reference and retention only
H-1
APPENDIX H: SUMMARY OF RELEVANT PRC LAWS AND REGULATIONS
The following is for general information only and does not purport to be a comprehensive description or
exhaustive statement of applicable laws and regulations. This description is based on laws, regulations
and interpretations now in effect and available as at the Latest Practicable Date. The laws, regulations
and interpretations, however, may change at any time, and any change could be retroactive. These laws
and regulations are also subject to various interpretations and the relevant authorities or the courts could
later disagree with the explanations or conclusions set out below.
THE PRC LEGAL SYSTEM
The PRC legal system is based on the PRC Constitution and is made up of written laws, regulations and
directives. Decided court cases do not constitute binding precedents.
The National Peoples Congress of the PRC (NPC) and the Standing Committee of the NPC are
empowered by the PRC Constitution to exercise the legislative power of the state. The NPC has the
power to amend the PRC Constitution and to enact and amend primary laws governing the state organs,
civil affairs and criminal offences and other matters. The Standing Committee of the NPC is empowered
to interpret, enact and amend laws other than those required to be enacted by the NPC.
The State Council of the PRC is the highest organ of state administration and has the power to enact
administrative rules and regulations. Ministries and commissions under the State Council of the PRC
are also vested with the power to issue orders, directives and regulations within the jurisdiction of their
respective departments. Administrative rules, regulations, directives and orders promulgated by the State
Council and its ministries and commissions must not be in conict with the PRC Constitution or the
national laws and, in the event that any conict arises, the Standing Committee of the NPC has the power
to annul such administrative rules and regulations enacted by the State Council and the State Council
has the power to annul such directives, orders and regulations issued by its ministries and commissions.
At the regional level, the peoples congresses of provinces and municipalities and their standing
committees may enact local rules and regulations and the peoples government may promulgate
administrative rules and directives applicable to their own administrative area. These local rules and
regulations may not be in conict with the PRC Constitution, any national laws or any administrative rules
and regulations promulgated by the State Council.
Some rules, regulations or directives may be enacted or issued at the provincial or municipal level or
by the State Council of the PRC or its ministries and commissions in the rst instance for experimental
purposes. After sufcient experience has been gained, the State Council may submit legislative proposals
to be considered by the NPC or the Standing Committee of the NPC for enactment at the national level.
The power to interpret laws is vested by the PRC Constitution in the Standing Committee of the
NPC. According to the Decision of the Standing Committee of the NPC Regarding the Strengthening
of Interpretation of Laws passed on 10 June 1981, the Supreme Peoples Court has the power to give
general interpretation on application of laws in judicial proceedings apart from its power to issue specic
interpretation in specic cases. The State Council and its ministries and commissions are also vested with
the power to give interpretation of the rules and regulations which they promulgated. At the regional level,
the power to give interpretation of regional laws is vested in the regional legislative and administration
organs which promulgate such laws. All such interpretations carry legal effect.
(a) Judicial system
The peoples courts are the judicial organs of the PRC. Under the PRC Constitution and the Law
of Organisation of the Peoples Courts of the PRC, the peoples courts comprise the supreme
peoples Court, the local peoples courts, military courts and other special courts. The local
peoples courts are divided into three levels, namely, the basic peoples courts, intermediate
peoples courts and higher peoples courts. The basic peoples courts are divided into civil, criminal
and administrative divisions. The intermediate peoples courts have divisions similar to those of the
basic peoples courts and, where the circumstances so warrant, may have other special divisions
(such as intellectual property divisions). The judicial functions of peoples courts at lower levels are
H-2
subject to supervision of peoples courts at higher levels. The peoples procuratorates also have
the right to exercise legal supervision over the proceedings of peoples courts of the same and
lower levels. The supreme peoples court is the highest judicial organ of the PRC. It supervises the
administration of justice by the peoples courts of all levels.
The peoples courts adopt a two-tier nal appeal system. A party may before the taking effect of
a judgment or order appeal against the judgment or order of the rst instance of a local peoples
court to the peoples court at the next higher level. Judgments or orders of the second instance at
the next higher level are nal and binding. Judgments or orders of the rst instance of the supreme
peoples court are also nal and binding. If, however, the supreme peoples court or a peoples
court at a higher level nds an error in a nal and binding judgment which has taken effect in any
peoples court at a lower level, a retrial of the case may be conducted according to the judicial
supervision procedures. If the president of a peoples court at any level nds a denite error in a
legally effective judgment or written order of his court and deems it necessary to have the case
retried, he shall refer it to the judicial committee for discussion and decision.
The PRC civil procedures are governed by the Civil Procedure Law of the PRC (the Civil
Procedure Law) adopted on 9 April 1991 and amended on 28 October 2007 and 31 August 2012.
The Civil Procedure Law contains regulations on the institution of a civil action, the jurisdiction of
the peoples courts, the procedures in conducting a civil action, trial procedures and procedures
for the enforcement of a civil judgment or order. All parties to a civil action conducted within the
territory of the PRC must comply with the Civil Procedure Law. A civil case is generally heard
by a court located in the defendants place of domicile. The jurisdiction may also be selected by
express agreement by the parties to a contract provided that the provisions of this Law regarding
jurisdiction by level and exclusive jurisdiction shall not be violated, and has some connection with
the dispute. That is to say, the plaintiff or the defendant is located or domiciled, or the contract was
executed or implemented in the jurisdiction selected, or the subject-matter of the proceedings is
located in the jurisdiction selected. A foreign national or foreign enterprise is accorded the same
litigation rights and obligations as a citizen or legal person of the PRC. If any party to a civil action
refuses to comply with a judgment or order made by a peoples court or an award made by an
arbitration body in the PRC, the aggrieved party may apply to the peoples court to enforce the
judgment, order or award. There are time limits on the right to apply for such enforcement.
A party seeking to enforce a judgment or order of a peoples court against a party who or whose
property is not within the PRC may directly apply for recognition and enforcement to the foreign
court which has jurisdiction over the case, or the peoples court may, in accordance with the
relevant provisions of the international treaties concluded or acceded to by the PRC, or on the
principle of reciprocity, request recognition and enforcement by a foreign court.
(b) Arbitration and enforcement of arbitral awards
The Arbitration Law of the PRC (the Arbitration Law) was promulgated by the Standing
Committee of the NPC on 31 August, 1994 and came into effect on 1 September 1995 and
amended in 27 August 2009. Contractual disputes between citizens of equal status, legal persons
and other economic organisations and disputes arising from property rights may be put to
arbitration. Where the parties have reached an agreement for arbitration, the peoples court shall
not accept the suit brought to the court by any one single party involved, except in case where the
agreement for arbitration is invalid.
Under the Arbitration Law, an arbitral award is nal and binding on the parties and if a party
fails to comply with an award, the other party to the award may apply to the peoples court for
enforcement.
A peoples court may refuse to enforce an arbitral award made by an arbitration committee if the
respondent has produced evidences to substantiate one of the cases provided for in the second
paragraph of Article 237 of the Civil Procedure Law.
H-3
Where a party involved in a foreign arbitration case applies for the enforcement of the award that
has taken legal effect, the party shall apply directly with a foreign law court with the jurisdiction for
recognition and enforcement if the party that should implement the award or its property is not in
the territory of the PRC.
In respect of contractual and non-contractual commercial-law-related disputes which are
recognised as such for the purposes of the PRC law, the PRC has acceded to the Convention on
the Recognition and Enforcement of Foreign Arbitral Award (the New York Convention) adopted
on 10 June 1958 pursuant to a resolution of the Standing Committee of the NPC passed on 2

December 1986. The New York Convention provides that all arbitral awards made by a state which
is a party to the New York Convention shall be recognised and enforced by other parties to the
New York Convention subject to their right to refuse enforcement under certain circumstances
including where the enforcement of the arbitral award is against the public policy of the state to
which the application for enforcement is made. It was declared by the Standing Committee of the
NPC at the time of the accession of the PRC that (i) the PRC would only recognise and enforce
foreign arbitral awards on the principle of reciprocity and (ii) the PRC would only apply the New
York Convention in disputes considered under PRC laws to be arising from contractual and non-
contractual mercantile legal relations.
PRC LAWS RELATING TO FOREIGN INVESTMENT
Pursuant to the (Provisions on Guiding the Orientation of Foreign Investment)
effective as of 1 April 2002 and according to the (2011 ) (Catalogue for the
Guidance of Foreign Investment Industries (amended in 2011)) effective as of 30 January 2012, foreign-
funded projects fall into 4 categories, namely encouraged, permitted, restricted and prohibited ones.
PRC LAWS RELATING TO TAXATION AND FEES
(a) Enterprise Income Tax
According to the (Enterprise Income Tax Law) effective as of 1
January 2008 and the (its implementation rules), a unied
enterprise income tax rate of 25% is applied equally to both domestic enterprises and foreign
invested enterprises and dividends from the PRC companies to their foreign shareholders are
subject to a withholding tax generally at a rate of 10%, unless it is entitled to tax incentives or tax
exemption under the relevant tax treaties.
Pursuant to the
(Avoidance of Double Taxation Agreement between Singapore and China) executed on 11 July
2007, the withholding tax rate on the dividends distribution by the foreign investment enterprises
shall not exceed ve per cent. (5%) of the total dividends declared if the benecial owner of the
dividends is a company (and not a partnership) that holds at least 25% of the share capital of the
foreign investment enterprises paying the dividend.
On 20 February 2009, the (Notice of the
State Administration of Taxation on the Issues concerning the Application of the Dividend Clauses
of Tax Agreements) (the 2009 Notice) was issued by State Administration of Taxation. Further
to the 2009 Notice, if pursuant to the dividend clauses of a tax agreement, a scal resident of the
other contracting party to such tax agreement directly owns a certain proportion (generally 25%
or 10%) of the capital of a PRC resident company which pays dividends, the tax on the dividends
paid to the scal resident of the other contracting party may be levied at the tax rate prescribed
in the tax agreement. To enjoy such treatment under the tax agreement, the scal resident of
the other contracting party shall meet all of the following requirements: (1) according to the tax
agreement, the scal resident of the other contracting party shall be limited to a company; (2) both
the proportion of all ownership interest and the proportion of all voting shares in the PRC resident
company of the scal resident of the other contracting party shall meet the prescribed proportions;
and (3) the proportion of capital of the PRC resident company directly owned by the scal resident
of the other contracting party shall meet the proportion prescribed in the tax agreement at any time
during 12 consecutive months before dividends are obtained.
H-4
According to the Notice in relation to (How to
Understand and Determine the Benecial Owners under Taxation Conventions) (Guo Shui Han
[2009] 601) issued by the State Taxation Administration of the PRC on 27 October 2009, and the
(Announcement in relation to Determine
the Benecial Owners under Taxation Conventions (Announcement of the State Administration
of Taxation [2012] No. 30)) issued by the State Taxation Administration of the PRC on 29 June
2012, a benecial owner is a person who has both ownership and right of control over the income,
assets or rights generating the income and is generally engaged in substantive business. Pursuant
to the aforesaid stipulations, the PRC tax authorities must evaluate whether an applicant (income
recipient) can qualify as a benecial owner under the relevant tax treaties on a case-by-case
basis, and in conducting such evaluation, the tax authorities must examine the substance rather
than the form of the relevant case.
(b) Value added tax
The (Provisional Regulations of the PRC Concerning Value Added
Tax) promulgated by the State Council came into effect on 1

January 1994 and was amended on 5

November 2008. Under the Provisional Regulations of the PRC Concerning Value Added Tax, value
added tax is imposed on goods sold in or imported into the PRC and on processing, repair and
replacement services provided within the PRC.
Value added tax payable in the PRC is charged on an aggregated basis at a rate of 13% or 17%
(depending on the type of goods involved) on the full price collected for the goods sold or, in
the case of taxable services provided, at a rate of 17% on the charges for the taxable services
provided but excluding, in respect of both goods and services, any amount paid in respect of value
added tax included in the price or charges, and less any deductible value added tax already paid
by the taxpayer on purchases of goods and service in the same nancial year.
PRC LAWS RELATING TO WHOLLY FOREIGN-OWNED ENTERPRISE
Wholly foreign-owned enterprises shall be subject to the (Law of the PRC on
Foreign-funded Enterprises) which was promulgated on 12 April 1986 and amended on 31 October 2000,
and its (implementation regulations) promulgated on 12 December
1990 and amended on 12 April 2001 (collectively, the Foreign-funded Enterprise Law).
(a) Procedures for establishment of a wholly foreign-owned enterprise
The establishment of a wholly foreign-owned enterprise will have to be approved by the Ministry
Of Commerce (MOC) in the PRC (or its delegated authorities). After an application for the
establishment of a foreign-funded enterprise has been approved, the foreign investor shall, within
30 days from the date of receiving a certicate of approval, apply to the industry and commerce
administration authority for registration and obtain a business licence. The date of issuance of the
business licence shall be the date of the establishment of the enterprise.
(b) Nature
The form of organisation of a foreign-funded enterprise shall be a limited liability company. Other
liability forms may be adopted by approval. In case of a limited liability company, the foreign
investor shall be liable for the enterprise to the extent of what he has contributed for the capital.
(c) Prot distribution
The Foreign-funded Enterprise Law provides that a foreign-funded enterprise shall retain certain
amount from its prots after the income tax has been paid in accordance with Chinese tax law
as reserve funds, bonus and welfare funds for workers and staff members. The amount retained
for the reserve funds shall not be less than 10% of the after-tax prots, and the withdrawal may
stop when the accumulated amount withdrawn has been up to 50% of the registered capital of the
enterprise. The amount retained for bonus and welfare funds for workers and staff members shall
H-5
be determined by the foreign-funded enterprise itself. No foreign-funded enterprise may distribute
its prots unless and until its decits of previous scal years have been made up; undistributed
prots of the previous scal years may be distributed together with the distributable prots of the
current scal year.
PRC LAWS RELATING TO PREVENTION AND CONTROL OF OCCUPATIONAL DISEASES
According to the (Prevention and Control of Occupational Diseases Law of
the PRC) promulgated on 27 October 2001, effective as of 1 May 2002 and amended on 31 December
2011, for construction projects, including projects to be constructed, expanded or reconstructed,
and projects for technical renovation which may cause occupational disease hazards, the enterprise
responsible for such projects shall: (i) during the period of feasibility study, submit to the health
administrative department a preliminary assessment report on such hazards; (ii) assess the effect of the
control on occupational disease hazards before the construction project is completed for inspection and
acceptance; and (iii) adopt protective facilities against occupational diseases. The protective facilities may
be put into formal operation and use only after they have passed the inspection by the public health
administration department.
According to the Prevention and Control of Occupational Diseases Law of the PRC, an employing
enterprise shall: (i) establish and improve the responsibility system of occupational disease prevention
and treatment, strengthen the administration and improve the level of occupational disease prevention
and treatment, and bear responsibility for the harm of occupational diseases arising therefrom; (ii)
purchase social insurance for industrial injury; (iii) adopt effective protective facilities against occupational
diseases, and provide protective articles to the labourers for personal use against occupational diseases;
(iv) set up alarm equipment, allocate on-spot emergency treatment articles, washing equipment,
emergency safety exits and safety zones for poisonous and harmful work places where acute
occupational injuries are likely to take place; and (v) inform the employees, according to the facts, of
the potential harm of occupational diseases as well as the consequences thereof and also highlight the
protective measures and treatment against occupational diseases when signing a labour contract with
employees.
PRC LAWS RELATING TO LABOUR
According to the (PRC Labour Law) promulgated on 5 July 1994, effective as of
1 January 1995 and amended on 27 August 2009, and the (PRC Labour
Contract Law) promulgated on 29 June 2007, effective as of 1 January 2008 and amended on 28
December 2012, employers shall establish employment relationships with employees on the date
of their employment. To establish the employment relationship, a written employment contract shall
be entered into between the parties, failing which the employers shall be held liable. The PRC laws
prohibit employers from making their employees work beyond the maximum working hours allowed by
law and to pay wages which are no lower than local standards on minimum wages to the employees.
Employers shall also establish a system of labour safety and sanitation, and strictly abide by the rules
and standards on labour safety and sanitation set by the State, by inter alia, providing the employees with
labour protection equipment and sanitized conditions and carrying out regular health examinations for
employees engaged in hazardous work.
According to the (PRC Social Insurance Law) effective as of 1 July 2011 and
the (Interim Measures concerning the Administration of the Registration of
Social Insurance) promulgated on and effective as of 19 March 1999, employers in the PRC shall effect
the registration of social insurance with the competent authorities, and make contributions to the basic
endowment insurance, basic medical insurance, work-related injury insurance, unemployment insurance
and maternity insurance for their employees.
According to the (Regulations on Occupational Injury Insurance) promulgated on 27 April
2003, effective as of 1 January 2004 and amended on 20 December 2010, and the
(Interim Measures concerning the Maternity Insurance for Enterprise Employees) promulgated
on 14 December 1994 and effective as of 1 January 1995, PRC companies shall pay occupational injury
insurance premiums and maternity insurance premiums for their employees.
H-6
According to the (Regulations on the Administration of Housing Fund) promulgated
on and effective as of 3 April 1999, and amended on 24 March 2002, all PRC employers shall register
with the applicable housing fund management centre and open a special housing fund account with a
designated bank. The PRC employers and their employees are required to contribute to the housing fund
and their respective deposits.
PRC LAWS RELATING TO IMPORT AND EXPORT
According to the (Customs Law of the PRC) promulgated on 22 January 1987 and
amended on 8 July 2000 and 29 June 2013, (i) the consignee of import goods, the consignor of export
goods and the owner of import and export goods are the persons obligated to pay customs duties; (ii) the
consignee of import goods and the consignor of export goods shall make an accurate declaration and
submit the import or export licence and relevant documents to the Customs ofce for examination; and
(iii) all import and export goods shall be subject to customs examination except in particular cases. The
relevant customs authority is in charge of the collection of customs duties.
According to the (Import and Export Customs Duty Regulations of
the PRC) promulgated on 23 November 2003 and effective as of 1 January 2004 and amended on 8
January 2011, the customs duty of import goods and export goods shall be levied as ad valorem duty
(i.e., the price of import/export commodities is the basis for the calculation of the duties), duty on the
basis of quantity or in such other manners as prescribed by the State. When calculating the customs
duties, import/export commodities shall be classied under appropriate tax items in accordance with the
relevant rules and regulations in relation to the category of the customs import and export tariff and shall
be subject to tax levies pursuant to relevant tax rates.
PRC LAWS RELATING TO FOREIGN EXCHANGE
According to the (Regulations on Foreign Exchange Control of the PRC)
promulgated on 29 January 1996, effective as of 1 April 1996 and amended on 14 January 1997 and
5 August 2008, payments made in foreign currencies for international transactions, such as the sale or
purchase of goods, are not subject to PRC governmental control or restrictions. Certain organisations
in the PRC, including foreign-invested enterprises, may purchase, sell and/ or remit foreign currencies
at certain banks authorized to conduct foreign exchange business upon providing valid commercial
documents to such banks. However, approvals are required for the relevant capital account transactions.
According to the (Interim Measures for the Administration of Foreign Debts)
promulgated on 8 January 2003 and effective as of 1 March 2003, after signing loan contracts or security
contracts with foreign entities, domestic entities shall conduct registration procedures with the foreign
exchange control authorities according to the relevant provisions. Contracts of international commercial
loans or security contracts shall become effective only upon registration.
According to the (Circular on Issues
Concerning Outward Remittance of Prot, Stock Dividends and Stock Bonuses Processed by Designated
Foreign Exchange Banks) and
(Circular on Amending Circular on Issues Concerning Outward Remittance of Prot, Stock
Dividends and Stock Bonuses Processed by Designated Foreign Exchange Banks), foreign investors of
foreign-invested enterprises shall remit prots, dividends or stock bonuses abroad at designated foreign
exchange banks with the relevant documents including, without limitation, the tax-paid certicate and
taxation declaration form, the auditing report, the board of directors resolution on the distribution of
prots, stock dividends or stock bonuses, the foreign exchange registration certicate and the capital
verication report.
I-1
APPENDIX I: TAXATION
Singapore Taxation
The following is a discussion of certain tax matters relating to Singapore income tax, capital gains tax,
stamp duty and estate duty consequences in relation to the purchase, ownership and disposal of our
Shares. The discussion is limited to a general description of certain tax consequences in Singapore with
respect to ownership of our Shares by Singapore investors, and does not purport to be a comprehensive
nor exhaustive description of all of the tax considerations that may be relevant to a decision to purchase,
own or dispose our Shares and does not purport to apply to all categories of investors, some of which
may be subject to special rules. The laws, regulations and interpretations, however, may change at
any time, and any change could be retroactive to the date of issuance of our Shares. These laws and
regulations are also subject to various interpretations and the relevant tax authorities or the courts of
Singapore could later disagree with the explanations or conclusions set out below.
You, as a prospective subscriber of our Shares, should consult your tax advisors concerning
the tax consequences of purchasing, owning and disposing our Shares. Neither our Company,
our Directors nor any other persons involved in this Invitation accepts responsibility for any tax
effects or liabilities resulting from the subscription, purchase, holding or disposal of our Shares.
INCOME TAX
General
Singapore resident taxpayers are subject to Singapore income tax on income accruing in or derived from
Singapore and on foreign income received or deemed received in Singapore. However, foreign income in
the form of branch prots, dividends and service income (the specied foreign income) received or
deemed received in Singapore on or after 1 June 2003 by a resident taxpayer are exempted from tax in
Singapore provided the following conditions are met:
(i) such income is subject to tax of a similar character to income tax under the law of the jurisdiction
from which such income is received;
(ii) at the time the income is received in Singapore, the highest rate of tax of a similar character to
income tax in the jurisdiction from which the income is received is at least 15%; and
(iii) the Singapore Comptroller of Income Tax is satised that the tax exemption would be benecial to
the recipient of the foreign income.
As a concession, the subject to tax condition in (i) above would, with effect from 30 July 2004, be
considered met for specied foreign income which are exempt from tax in the foreign jurisdiction
from which the specied foreign income is received if the exemption is due to a tax incentive granted
by the foreign jurisdiction for carrying out substantive business activities in that jurisdiction. Generally,
substantive business activities refer to business activities that are carried out through staff with certain
expertise and actual expenditure is incurred to carry out the activities. In addition, all foreign-sourced
personal income received or deemed received in Singapore by a Singapore tax resident individual
(except where such income is received through a partnership in Singapore) on or after 1 January 2004
will be exempt from tax in Singapore if the Singapore Comptroller of Income Tax is satised that the
tax exemption would be benecial to the individual. Certain investment income derived from Singapore
sources by individuals on or after 1 January 2004 will also be exempt from tax.
Non-Singapore tax-resident corporate taxpayers are subject to Singapore income tax on income accruing
in or derived from Singapore, and on foreign income received or deemed received in Singapore, subject
to certain exceptions. Non-Singapore tax-resident individual taxpayers, subject to certain exceptions,
are subject to Singapore income tax only on income accruing in or derived from Singapore. A company
is regarded as a tax resident in Singapore if the control and management of its business is exercised
in Singapore. An individual is regarded as a tax resident in Singapore in a year of assessment if, in
the preceding calendar year, he was physically present in Singapore or has exercised employment in
Singapore (other than as a director of a company) for 183 days or more, or if he ordinarily resides in
Singapore.
I-2
Rates of Tax
The prevailing corporate tax rate in Singapore is 17% with effect from year of assessment 2010. In
addition, 75% of up to the rst $10,000 of a companys normal chargeable income, and 50% of up to
the next $290,000 is exempt from corporate tax. The remaining chargeable income (after the partial tax
exemption) will be taxed at 17%. This partial exemption will not apply to Singapore dividends. In addition,
for newly-incorporated entities, subject to meeting certain conditions, the rst S$100,000 and one-half
of up to the next S$200,000 of their normal chargeable income, excluding Singapore dividends, will be
eligible for tax exemption. For the years of assessment 2013, 2014 and 2015, it has been proposed in the
Income Tax (Amendment) Bill 2013 that companies will be granted a 30% corporate income tax rebate
(capped at S$30,000) for each year of assessment.
Singapore tax-resident individuals are subject to tax based on progressive rates, currently ranging from
0% to 20%.
Non-Singapore resident individuals, subject to certain exceptions, are subject to Singapore income tax
on income accrued in or derived from Singapore. They are generally subject to tax at 20% except for
Singapore employment income which is subjected to tax at a at rate of 15% or at the resident rate,
whichever is higher.
Dividend Distributions
(i) One Tier Corporate Taxation System
Singapore adopts the One-Tier Corporate Taxation System (One-Tier System). Under the One-
Tier System, the Singapore income tax collected from corporate prots is a nal tax and the after-
tax prots of the company resident in Singapore can be distributed to the shareholders as tax-
exempt (One-Tier) dividends. Such dividends are tax-exempt in the hands of the shareholders.
(ii) Withholding Taxes
Singapore does not currently impose withholding tax on dividends paid to resident or non-resident
shareholders.
Foreign shareholders are advised to consult their own tax advisers to take into account the tax
laws of their respective home countries/countries of residence and the applicability of any double
taxation agreement which their country of residence may have with Singapore.
CAPITAL GAINS TAX
There is no tax on capital gains in Singapore.
Thus any gains derived from the disposal of our Shares acquired for long-term investment will not be
taxable in Singapore, provided that they are capital in nature.

On the other hand, where the taxpayer is deemed by IRAS to be carrying on a trade or business of
dealing in shares in Singapore, gains from disposal of shares are of an income nature (rather than capital
gains) and thus subject to Singapore income tax.
Subject to certain conditions being met, with effect from 1 June 2012 and for a period of ve (5) years,
gains derived from the disposal of ordinary shares by companies will not be subjected to Singapore tax,
if the divesting company holds a minimum shareholding of 20% of the ordinary shares in the company
whose shares are being disposed for a minimum period of 24 months, immediately prior to the date of
disposal of such shares. This exemption does not apply to a divesting company whose gains on prots
from the disposal of shares are included as part of its income based on the provisions of Section 26 of
the Income Tax Act, Chapter 134 of Singapore; or disposal of shares in an unlisted investee company that
is in the business of trading or holding Singapore immovable properties (other than business of property
developments; or disposal of shares by a partnership, limited partnership or limited liability partnership
where one or more of the partners is/are company(ies).
I-3
Other than the above, there are no specic laws or regulations which deal with the characterisation of
capital gains, and hence, gains may be construed to be of an income nature and subject to tax especially
if they arise from activities which the Singapore Comptroller of Income Tax regards as the carrying on of
a trade in Singapore.
Foreign sellers are advised to consult their own tax advisers to take into account the applicable tax laws
of their respective home countries or countries of residence as well as the provisions of any applicable
double taxation agreement.
STAMP DUTY
No stamp duty is payable on the subscription for and issuance of our Shares.
Where existing Shares evidenced in certicated form are acquired in Singapore, stamp duty is payable
on the instrument of transfer of the Shares at the rate of S$2.00 for every S$1,000 or any part thereof of
the consideration for, or market value of the Shares, whichever is higher. The purchaser is liable for stamp
duty, unless otherwise agreed.
No stamp duty is payable if no instrument of transfer is executed (such as in the case of scripless shares,
the transfer of which does not require instruments of transfer to be executed) or if the instrument of
transfer is executed outside Singapore. However, stamp duty may be payable if the instrument of transfer
which is executed outside Singapore is subsequently received in Singapore. Stamp duty is also not
applicable to electronic transfers of shares through the Central Depository System.
ESTATE DUTY
Singapore estate duty has been abolished with effect from 15 February 2008.
GOODS AND SERVICES TAX (GST)
General
The sale of our Shares by a GST-registered investor belonging in Singapore to another person belonging
in Singapore is an exempt supply not subject to GST. Any GST (for example, GST on brokerage) incurred
by the investor in connection with the making of this exempt supply will generally become an additional
cost to the investor unless the investor satises certain concessions.

Where our Shares are sold by a GST-registered investor to a person belonging to a country other than
Singapore, the sale is a zero-rated supply (i.e. subject to GST at zero rate). Any GST (for example, GST
on brokerage) incurred by him in the making of this zero-rated supply for the purpose of his business will,
subject to the provisions of the GST legislation, be recoverable as an input tax credit in his GST returns.
Investors should seek their own tax advice on the recoverability of GST incurred on expenses in
connection with purchase and sale of our Shares.
Services such as brokerage, handling and clearing services rendered by a GST-registered person to
an investor belonging in Singapore in connection with the investors purchase, sale or holding of our
Shares will be subject to GST at the prevailing rate of seven per cent. (7.0%). Similar services rendered
contractually to an investor belonging outside Singapore should qualify for zero-rating (i.e. subject to GST
at zero rate) provided that the investor is not physically present in Singapore at the time the services are
performed and the services do not directly benet a person belonging inside Singapore.
J-1
APPENDIX J: WGM TECHNICAL REPORT
A TECHNICAL REVIEW OF THE
CHENG QIANG YAN PHOSPHATE DEPOSIT
AND SHI SUN XI PHOSPHATE DEPOSIT,
MIANZHU CITY, SICHUAN PROVINCE,
PEOPLES REPUBLIC OF CHINA
FOR
ASIAPHOS PRIVATE LIMITED
prepared by:
Donald H. Hains, P.Geo.
Senior Associate Industrial Mineral Specialist
and
G. Ross MacFarlane, P.Eng.
Senior Associate Metallurgical Engineer
supervised by:
Joe Hinzer, P.Geo.
President and Director
(Watts, Grifs and McOuat Limited)
Suite 400, 8 King Street East,
Toronto, Ontario M5C 1B5
Canada
February 28, 2013
Toronto, Canada
J-2

TABLE OF CONTENTS
Page
1. EXECUTIVE SUMMARY .......................................................................................................... J-5
2. INTRODUCTION AND TERMS OF REFERENCE ................................................................... J-12
2.1 INTRODUCTION ............................................................................................................ J-12
2.2 TERMS OF REFERENCE ............................................................................................. J-12
2.3 SOURCES OF INFORMATION ..................................................................................... J-13
2.4 DETAILS OF PERSONAL INSPECTION OF THE PROPERTY .................................... J-13
2.5 UNITS AND CURRENCY .............................................................................................. J-14
2.6 DEFINITIONS ................................................................................................................ J-15
3. RELIANCE ON OTHER EXPERTS .......................................................................................... J-17
4. PROPERTY DESCRIPTION AND LOCATION ......................................................................... J-18
4.1 LOCATION ..................................................................................................................... J-18
4.2 PROPERTY DESCRIPTION .......................................................................................... J-18
4.3 ENVIRONMENTAL AND REHABILITATION .................................................................. J-20
5. ACCESS, CLIMATE, LOCAL RESOURCES, INFRASTRUCTURE AND PHYSIOGRAPHY J-21
5.1 ACCESS ........................................................................................................................ J-21
5.2 CLIMATE ........................................................................................................................ J-21
5.3 LOCAL RESOURCES AND INFRASTRUCTURE ......................................................... J-21
5.4 PHYSIOGRAPHY .......................................................................................................... J-22
6. HISTORY ................................................................................................................................... J-23
7. GEOLOGICAL SETTING AND MINERALIZATION ................................................................. J-26
7.1 REGIONAL, LOCAL AND PROPERTY GEOLOGY ...................................................... J-26
7.2 GENERAL STRATIGRAPHY ......................................................................................... J-26
7.3 STRATIGRAPHY OF CHENG QIANG YAN ................................................................... J-28
7.4 STRATIGRAPHY OF SHI SUN XI ................................................................................. J-31
7.5 STRATIGRAPHY OF THE PHOSPHORITE BED.......................................................... J-32
7.6 GEOLOGICAL STRUCTURE ........................................................................................ J-32
7.7 STRUCTURE OF SHI SUN XI ....................................................................................... J-33
7.8 SEISMICITY ................................................................................................................... J-33
7.9 MINERALIZATION ......................................................................................................... J-34
8. DEPOSIT TYPES ...................................................................................................................... J-36
9. EXPLORATION ......................................................................................................................... J-38
10. DRILLING AND TRENCHING .................................................................................................. J-39
11. SAMPLE PREPARATION, ANALYSES AND SECURITY ....................................................... J-40
11.1 SAMPLING METHOD AND APPROACH ....................................................................... J-40
11.2 SAMPLE PREPARATION AND ASSAYING .................................................................... J-41
12. DATA VERIFICATION ............................................................................................................... J-44
J-3

13. MINERAL PROCESSING AND METALLURGICAL TESTING ................................................ J-45
14. MINERAL RESOURCE ESTIMATES ....................................................................................... J-46
14.1 GENERAL ....................................................................................................................... J-46
14.2 DEFINITIONS ................................................................................................................. J-47
14.3 PHOSPHORITE RESOURCE ESTIMATE BY WGM ...................................................... J-48
14.4 CHENG QIANG YAN AND SHI SUN XI RESOURCE ESTIMATION
METHODOLOGY ............................................................................................................ J-52
* Sections 15 through 22 are not required for this type of NI 43-101 report.
15. ADJACENT PROPERTIES ....................................................................................................... J-60
16. OTHER RELEVANT DATA AND INFORMATION .................................................................... J-61
16.1 FUTURE PRODUCTION PLANNING ............................................................................. J-62
16.2 MINE PLAN AND FINANCIAL EVALUATION ................................................................. J-63
16.3 MINE HAULAGE ROAD .................................................................................................. J-66
16.4 MINE DEVELOPMENT ................................................................................................... J-69
16.5 ENVIRONMENTAL AND SOCIAL ................................................................................... J-69
16.6 OTHER RELATIVE INFORMATION ................................................................................ J-70
16.7 ADDITIONAL REQUIREMENTS..................................................................................... J-70
17. INTERPRETATION AND CONCLUSIONS ............................................................................... J-71
18. RECOMMENDATIONS ............................................................................................................. J-74
19. DATE AND SIGNATURE PAGE ............................................................................................... J-77
CERTIFICATE ..................................................................................................................................... J-79
CONSENT OF QUALIFIED PERSON ................................................................................................ J-82
REFERENCES .................................................................................................................................... J-84
APPENDIX 1 FINANCIAL ANALYSIS ................................................................................................ J-85
APPENDIX 2 DETAILS OF RESOURCE CALCULATIONS .............................................................. J-90
LIST OF TABLES
1. List of denitions ....................................................................................................................... J-15
2. Summary of assets ................................................................................................................... J-20
3. Shi Fang type phosphorite deposit stratigraphic column Sichuan Province, Peoples
Republic of China ...................................................................................................................... J-29
4. Total estimated M&I phosphorite Resources for Mianzhu Norwest .......................................... J-49
5. Estimated Inferred phosphorite Resources for Mianzhu Norwest ............................................. J-49
6. Summary of the Mineral Resources for Mianzhu Norwest Mines ............................................. J-52
7. Mianzhu Norwest mine production plan, Mianzhu Norwest phosphorite output ....................... J-62
8. Summary of nancial analysis of Mianzhu Norwests operations, 2012 to 2026 ...................... J-64
9. Estimated phosphorite Resources for Cheng Qiang Yan .......................................................... J-72
10. Estimated phosphorite resources for Shi Sun Xi ...................................................................... J-72
11. Initial development program budget estimate ........................................................................... J-76
J-4

LIST OF FIGURES
1. Project location map .................................................................................................................. J-19
2. Geology map of the Mianzhu City area .................................................................................... J-27
3. Cheng Qiang Yan (Mine 1) land status map ............................................................................. J-50
4. Shi Sun Xi (Mine 2) land status map ........................................................................................ J-51
5. Cheng Qiang Yan Frequency Distribution Curve ....................................................................... J-54
6. Shi Sun Xi Frequency Distribution Curve .................................................................................. J-54
7. Cheng Qiang Yan -- perspective view ....................................................................................... J-56
8. Shi Sun Xi -- perspective view .................................................................................................. J-57
9. Cheng Qiang Yan -- Resource polygons ................................................................................... J-58
10. Shi Sun Xi -- Resource polygons .............................................................................................. J-59
11. Sensitivity analysis of Mianzhu Norwest net cash ow ............................................................. J-66
12. Mianzhu Norwest Mine haulage route ...................................................................................... J-68
J-5

1. Executive Summary
Watts, Grifs and McOuat Limited (WGM) was originally retained by Norwest Chemicals Pte Ltd, the
immediate holding company of Sichuan Mianzhu Norwest Phosphate Chemical Co. Ltd (Mianzhu
Norwest) in 2010 to assist the company and ultimately prepare an independent technical report
(Technical Report) in compliance with the requirements of the Catalist Board of the Singapore
Exchange Securities Trading Limited (SGX-ST) as specified by Practice Note 4C, Disclosure
Requirements for Mineral, Oil and Gas Companies. This report has been prepared according to the
reporting standards of both the National Instrument 43101 Standards of Disclosure for Mineral Projects,
including Companion Policy 43-101, as promulgated by the Canadian Securities Administrators (NI 43-
101) and JORC, the Australian Code for Reporting of Exploration Results, Mineral Resources and Ore
Reserves, for the reporting of compliant Mineral Resources on two phosphorite deposits in Sichuan
Province, Peoples Republic of China (PRC).

The purpose of this report is to summarize the review of the geological exploration, and Mineral Resource
estimates for the two phosphorite deposits and review the status of the mining and processing operations
that were being restored to production following the earthquake with Richter scale 8.0 magnitude on
May 12, 2008 (the Wenchuan Earthquake). Mianzhu Norwest may also use this report as a supporting
document for a listing by its holding company, AsiaPhos Private Limited, on the Catalist Board of the
Singapore Exchange Securities Trading Limited and related nancing activities. The Project comprises:
Cheng Qiang Yan Property () (Cheng Qiang Yan or
Mine #1) A single phosphorite bed deposit with an underground mining operation in production;
Shi Sun Xi Property () (Shi Sun Xi or Mine #2) A
single phosphorite bed deposit with an underground mining operation in development; and
Downstream Processing facility (Plant) located in Gongxing Town, near Mianzhu City with
20,000 tpa (tonnes per annum) capacity in the nal stages of construction to receive product from
the two mining operations.
WGM conducted its rst site visit from February 23 to March 3, 2010 and reported its initial ndings and
recommendations to the company on June 15, 2010. The second site visit was made from November
27 to 29, 2011. WGM made a third site visit in May, 2012 to again review progress and obtain updated
information on the project.
A fourth visit to the property was made near the end of the 2012 eld season on November 26 to
28, 2012 to assess the status of the road reconstruction, and progress in development at the two mine
sites, and construction of the new processing facilities. Following the Wenchuan Earthquake the mines
required a rework of the mine access and loading facilities to re-establish safer and more reliable truck
loading facilities to be able to sustain the scheduled production increases.
The mining operations at Cheng Qiang Yan and Shi Sun Xi are located about 45 km northwest
(straightline about 330) of downtown Mianzhu City under the jurisdiction of Qing Ping Town, Mianzhu
City, Sichuan Province, PRC and are approximately 8 km apart. The properties are known as Cheng
Qiang Yan and Shi Sun Xi (collectively, the Mines) and their geographic locations are:
Cheng Qiang Yan Shi Sun Xi
N313614.00 N 313837.00
E 1040014.00 E 1040443.00
J-6

The road distance, from Mianzhu Norwests previous processing facilities in Hanwang Town, Mianzhu City
to the Cheng Qiang Yan is approximately 45 km and the distance to Shi Sun Xi is approximately 42 km.
The new downstream processing facility is located in a newly developed industrial area in Gongxing
Town (the New Gongxing Site) and near the start of the Mian Yuan River canyon that provides the road
access to the two mining operations.
At the time of the second site visit in November 2011, a new downstream processing facility was being
constructed approximately 2 km from the site of the original facility that had been damaged in the
Wenchuan Earthquake. The 20,000 tpa Plant will replace the crushing plant that was located in Qing Ping
Town on the mine haulage route and the four P
4
furnaces and related production facilities. The new plant
construction consists of a fully integrated operation on one site with crushing, screening, drying and rock
storage facilities and two new P
4
electric arc furnaces. The new location will also provide for production of
phosphate chemicals for food processing, SHMP (Sodium Hexametaphosphate) plant and STPP (Sodium
Triphosphate) plant. The STPP plant and product storage and handling facilities were being relocated
from the original site to the new processing plant location and a new SHMP plant will also be built at this
site. This will consolidate all the processing operations in one location with the new site also containing
the ofces of Mianzhu Norwest.
Exploration of the phosphate deposits began in 1968 and the latest drilling program occurred in 2005.
In addition to the exploration and development programs, Mianzhu Norwest has conducted mining
and mine development operations on Mine #1 since 2002 and produced approximately 379,000
tonnes of phosphate rocks prior to the Wenchuan Earthquake that occurred in the immediate area on
May 12, 2008. Efforts since the Wenchuan Earthquake have focused on restoration of the road access to
Cheng Qiang Yan and Shi Sun Xi and rehabilitation of the downstream processing facility.
Access to the former producing mine property, Cheng Qiang Yan was re-established by the end of
April 2010 and work commenced to restore the surface facilities that allowed the resumption of mine
production in May 2011 after the haulage road was recovered from a major landslide in 2010 (the
Landslide) on the haulage route. Restoration of the access road to Mine #2 required extensive work and
access was not completed until May 2011 and production had started from one level at the time of the
May 2012 WGM site visit.
Underground workings (levels) at Cheng Qiang Yan, the formerly producing mine survived the
Wenchuan Earthquake with minimal damage but its mine portals were lled in with rubble from rock
slides and required rework to establish access and restore production facilities, The Shi Sun Xi mine
that was under development at the time of the Wenchuan Earthquake in 2008 had all access to
the underground workings buried by a massive rock slide during the earthquake. Recovery of the
development completed prior to the earth quake was not possible and two new levels have now been
developed in 2010 and 2011 at higher elevations. The new elevated valley oor is being used to establish
haulage roads and truck loading facilities.
Since WGMs rst visit Mianzhu Norwest has been working to restore production at an increased
capacity level. As part of WGMs initial recommendations in 2010 Mianzhu Norwest has engaged outside
expertise to advise on their overall business model and rank their business plan with others operating
in the industry. The favourable review is in full support of Mianzhu Norwests current plan to expand and
modernize their production facilities. The negative impact of the Wenchuan Earthquake has continued
to interfere with safe and reliable access to the mining operations but the combined efforts of the PRC
government and the mine operating companies using the same mine haulage routes are working to
remove these obstacles.
This Technical Report incorporates all applicable data, interpretations and conclusions which were in
hand as of December 31, 2012. This Technical Report was prepared for AsiaPhos Private Limited and
presents the estimated in situ phosphorite resources for Cheng Qiang Yan and Shi Sun Xi, separately
and in total. The report encompasses information and studies generated since the deposits were initially
explored in 1968 and actively mined by Mianzhu Norwest starting in 2002.
J-7

Conclusions
The two phosphorite deposits controlled by Mianzhu Norwest: Cheng Qiang Yan and Shi Sun Xi are
located in west-central Sichuan Province, PRC. Mianzhu Norwest has controlled these properties
under various stages of licensure since 2002. Until the Wenchuan Earthquake, Cheng Qiang Yan was
producing phosphate bearing rock at about 90,000 tpa and Shi Sun Xi was under development and was
beginning production in April 2008. Both Cheng Qiang Yan and Shi Sun Xi and their neighbouring mines
producing phosphate rock suffered severe damage to the infrastructure and haulage roads and caused
the cessation of all phosphorite production in the immediate area in May 2008. Restoration of previous
production levels is still in progress and major reconstruction work on the haulage route from the mines to
Qing Ping Town is still in progress.
The restoration of production suffered another major setback with the Landslide that suspended
operations for three months. WGM believes that as long as this risk is still present, Mianzhu Norwest
must continue to work diligently with the government and the neighboring operations in reconstruction of
the haulage road from the Mines to Qing Ping Town. At the time of WGMs last visit in November 2012
screening of areas where there is high risk of rock slides was in progress on a priority basis.
Both mine truck loading areas are located in areas where rock slides can occur. Mianzhu Norwest is
working towards relocation of these operations into safer locations utilizing existing tunnels down the
valley. In the interim, safety bays and lunch rooms are being developed underground with camera
surveillance installed in the high trafc areas to reduce employee exposure at the mine portals. Rework of
the portal areas has been completed to reduce the risk of rock falls to the operations.
WGM is not aware of any social or environmental issues, which would affect exploration, development,
and exploitation of the Mianzhu Norwest`s properties herein described as currently practiced in the PRC,
other than the required post-earthquake restoration activities which are currently being carried out in co-
ordination with local government and regulators.

Mineral Resources
Based on documents reviewed, interviews conducted and the site visits completed, as well as
subsequent computer modelling by WGM, the two phosphorite deposits controlled by Mianzhu Norwest
contain, as of December 31, 2012, an estimated Measured and Indicated (M&I) Resources of
20.6 million in situ tonnes, at a grade of 29.43% P
2
O
5
under mining licenses. A further 1.6 million in situ
tonnes of M&I Resources at a grade of 26.99% P
2
O
5
are controlled under exploration licenses on the
two properties. The Inferred Resources are estimated to total 2.7 million in situ tonnes, at a grade of
28.91% P
2
O
5
under the mining licenses and an inferred 16.1 million in situ tonnes are estimated under
the exploration licenses at a grade of 29.74% P
2
O
5
. These estimates used compatible NI 43-101 and
JORC classication criteria which are different than the National classication criteria of the PRC.
Computer model design criteria included:
Phosphorite Density A constant 3.08 tonnes per cubic metre was used for Cheng Qiang Yan
and 3.03 tonnes per cubic metre used for Shi Sun Xi; these are the same as for all past studies
conducted and are supported by reports and samples;
Minimum Phosphorite Bed Thickness 0.25 m; estimates by past PRC work use a minimum
thickness of 1.6 m (Thicknesses ranged from 1.08 m to 13.84 m);
Phosphorite Subcrops None were used. The geological history for the Shi Fang type deposit
dictates that all weathering phenomena were emplaced millions of years ago and no recent activity
accounts for changes;
Phosphorite Analyses The data which are contained in individual sample analyses contained
in the dataset for each property are limited. The past PRC estimates used various grade cut offs
at various times all dictated by Provincial guidelines; such cut offs are not geologically warranted,
an effective 8% P
2
O
5
cut off basis was applied by WGM (polygon grades ranged from 17.77%-
34.38%);
J-8

Outside Estimate Boundary The mining license boundary and the exploration license boundary
are used for each property; and
Average bed thickness and average P
2
O
5
content are weight averaged by tonnes from the various
applicable polygons resulting from the estimating process.
The following tables summarize the Mineral Resources by property area. For each property (asset) the
mineral resources for the mining licence area and exploration license area have been combined. Note
that the estimates account for the continuity, grades and bed thickness from drill holes and surface
trenching as well as mine development and production mining which were used in computer models
developed for each deposit.
Summary of the Mineral Resources and Reserves for Mianzhu Norwests Mines
Shi Sun Xi/China
Category Mineral
Type
Gross Attributable
to licence
Net Attributable to Issuer
Assumed at 100%
Remarks
Tonnes
(millions)
Grade
(P
2
O
5
%)
Tonnes
(millions)
Grade
(P
2
O
5
%)
Change
from previous
update (%)
Reserves Insufcient studies
to determine
Proved
Probable
Total
Resources*
Measured Phosphorite 6.9 29.21 6.9 29.21
Indicated Phosphorite 12.0 29.43 12.0 29.43
Total 18.9** 29.35** 18.9** 29.35**
Inferred Phosphorite 17.9 29.77 17.9 29.77
* The Measured and Indicated Resources are additional to the Reserves.
** Note: Inferred Resource cannot be included in total Resource calculation under NI 43-101 Standard.
Cheng Qiang Yan/China
Category Mineral
Type
Gross Attributable
to licence
Assumed at 100%
Remarks
Tonnes
(millions)
Grade
(P
2
O
5
%)
Tonnes
(millions)
Grade
(P
2
O
5
%)
Change
from previous
update (%)
Proved to determine
Probable
Total
Resources*
Indicated Phosphorite
Total 3.3** 28.67** 3.3** 28.67**
J-9

Mineral Resources that are not mineral reserves do not have demonstrated economic viability. Under both
NI 43-101 and JORC criteria, only Mineral Resources under the M&I classication may be considered
for inclusion into any mine planning efforts which are required and to possibly elevate the categorization
of that material to Reserve status. The demonstration of economic viability of the Resource and
downstream processing must be established before the Mineral Resources can be classed as Reserves.
No Inferred Resources may be included in these efforts.
This document is the reporting of phosphorite Resources only. No associated mining, metallurgical,
economic, marketing or environmental studies have been referenced in the preparation of these
Resources. The conversion of the phosphorite Resource to Reserves will require closer spaced drilling
and sampling to more accurately dene the deposit boundaries and thicknesses as well as the grades.
This conversion must be supported by the application of economic factors and mining factors to dene
the cut off grade for the portion of phosphorite Resource that is economic and can be classied as
reserves. The Mianzhu Norwest mining operation currently operates with very localized knowledge of
grade and thickness based on progressing from the active mining areas. This operating practice can
be exposed to changes in grade or production due to geologic factors that may change as the mining
is advanced putting production plans at risk. Based on the history to date of the Mianzhu Norwest
operations, WGM believes that completion of the necessary drilling and sampling will be successful in
conversion of a high proportion of the Resource being classied as Reserves. The Resource estimates
made in this report are based on the assumption of the existence of one continuous mineralized bed on
the licenses. There is a reasonable expectation that further exploration of the licence areas can contribute
to increases in the Resources resulting from better understandings of the local structure and thickness of
the mineralization.
Further development efforts, primarily drilling and sampling, are required to elevate the Inferred
Resources, or any portion thereof, to the Measured and Indicated categories. This work may take place
in the future as required by Mianzhu Norwests long-term business planning.
Considering the phosphorite content and quality, the phosphorite Resources controlled by Mianzhu
Norwest are higher grade than many of the nearby phosphorite deposits of a different geologic age.
The single phosphorite bed on both properties, geologically the same bed, has been designated by the
PRC as a special type of deposit the Shi Fang Type. The Shi Fang type of phosphorite deposit has
been in production in the region for many years. As such, a great deal of experience has been gained
in producing marketable products from this deposit type. The products produced from the Shi Fang
deposits include elemental phosphorus and downstream products as well as fertilizer products from wet
process phosphoric acid (WPPA). The past exploration and development programs on the Shi Fang
deposits have not completed the normal comprehensive analyses in support of testing and designing
the optimal downstream processing. The full analysis of the phosphorite Resource as well as the normal
metallurgical testing has not been carried out as would be routine for development considerations of
deposits of this type elsewhere in the world. As such, it is difcult to compare these deposits with others
around the world other than by evaluation of the products produced.
Recommendations
In general WGM agrees with Mianzhu Norwests post-Wenchuan Earthquake business plan that
accommodates the current conditions of each of the Mines. This includes the scope, schedule and cost
of the restoration and expansion of production as well as the long-term approach for the operations
taking into consideration current and projected markets. The plan should continue to address the type of
operation necessary to reach standards that are more analogous to international best practice and that
may be necessary for compliance with potential future state requirements, standards for listed companies
and possibly required by the future market place standards for the industry such as ISO certications.
J-10

Each of the Mines needs additional geologic denition through further drilling and sampling required for
better mine planning with reduced risk to production shortfalls or grade variations. The current practices
of exploration through production should be replaced with Reserve denition drilling prior to mining.
All future exploration sampling should include expanded chemical analyses. The recommended expanded
analytical suite will allow a series of judgements to be made by Mianzhu Norwest regarding possible
new processing technologies and possible new products and markets. Currently, information that allows
alternative processing evaluations appears to be totally absent. The expanded information will also
provide records for environmental assessment as well as data to support possible control and mitigation
measures that may become necessary to sustain future operations.
WGM has proposed a scope of work, including a preliminary budget for a series of programs to advance
the project to the next level of development. This scope of work will include the necessary data collection,
mine planning, environmental baselines and mitigation measures, market analysis, and financial
examinations necessary to proceed with Reserve designation and production at all component sites.
J-11

Initial Development Program Budget Estimate
Conversion of RMB/US$ at 0.157867 (March 14, 2012)
Item Units RMB/Unit Units Used Total RMB US$ Total
Cheng Qiang Yan
Mining Development
Level 5 -- 2385 elev Metres 1,073 250 268,250 42,348
Galleries Units 107,300 2 214,600 33,878
Drilling Metres 751 1000 751,000 118,558
Samples Metres 590 50 29,500 4,657
Galleries Units 107,300 2 214,600 33,878
Drilling Metres 751 800 600,800 94,846
Samples Metres 590 50 17,700 2,794
Galleries Units 107,300 2 214,600 33,878
Drilling Metres 751 800 600,800 94,846
Samples Metres 590 50 29,500 4,657
Vertical Drilling Holes 2
Drilling Metres 751 750 563,250 88,919
Samples Metres 590 15 8,850 1,397
Trenching
Digging Units 107,300 1 107,300 16,939
Samples Metres 590 10 5,900 931
Other Contractor Costs 15% of Above 664,700 104,934
Contractor Management 10% of Above 443,100 69,951
Mianzhu Norwest Overhead/
Management 5% of above 221,600 34,983
TOTAL 5,760,800 909,440
Shi Sun Xi
Mining Development
Vertical Drilling
Mining License Holes 2
Drilling Metres 751 800 600,800 94,846
Samples Metres 590 20 11,800 1,863
Exploration License Holes 3
Drilling Metres 751 1,200 901,200 142,270
Samples Metres 590 25 14,750 2,329
Trenching
MIANZHU NORWEST Overhead/
Management 5% of above 76,400 12,061
TOTAL 1,987,200 313,713
GRAND TOTAL (both mines) 7,748,000 1,223,154
Note: Budget estimated in May 2010 and escalated to 1st quarter 2012 and converted to RMB in March 2012 at the exchange rate
of US$0.157867 per RMB.
J-12

2. INTRODUCTION AND TERMS OF REFERENCE
2.1 INTRODUCTION
Watts, Grifs and McOuat Limited (WGM) was initially retained in February 2010 by Norwest Chemicals
Pte. Ltd., the immediate holding company of Sichuan Mianzhu Norwest Phosphate Chemical Co. Ltd.
(Mianzhu Norwest) to prepare an independent Technical Report and Mineral Resources to in
compliance with the reporting standards of National Instrument 43-101 (NI 43-101) and JORC on two
phosphorite deposits in Sichuan Province, Peoples Republic of China (PRC). WGM rst visited the
operations of Mianzhu Norwest in May 2010 and a second time on November 27 and 28, 2011. WGM
visited the sites for the third time on May 31, 2012. A fourth site visit was conducted on November 26-
28, 2012.
This Technical Report has been prepared for Mianzhu Norwest in compliance with the requirements of
a NI 43-101 Technical Report and Mineral Resource estimate. The report includes a technical review of
its properties including the exploration programs and the mining and processing operations. The data
supporting the statements made in this report have been veried for accuracy and completeness by
the authors. With due regard, for the standards for documentation of resources in China, no meaningful
errors or omissions were noted. The effective date of this Technical Report is 31 December 2012 and this
Technical Report is dated 28 February 2013. WGM conrms to the best of their knowledge, that there
is no new material information that has arisen between the effective date and the date of the Technical
Report which would be required to be included in the Technical Report for completeness.
2.2 TERMS OF REFERENCE
This report has been completed pursuant to the initial engagement executed between Norwest
Chemicals Pte. Ltd. and WGM, dated November 10, 2009 and subsequently revised in November 30,
2011. WGMs scope of work included making site visits, reviewing the available information related to
the Mianzhu Norwest properties and summarizing its ndings and recommendations in a report prepared
in compliance with Canadian Securities Administrators NI 43-101 and denitions of the Council of
the Canadian Institute of Mining, Metallurgy and Petroleum (CIM) standards. NI 43-101 and JORC
reporting standards are based on the same principles and are very similar. Compliance with NI 43-101
encompasses compliance with JORC.
This report summarizes the status of the operations since the initial site visit in 2010 along with the
status of the geological exploration, geological reports, and Mineral Resource estimates for the Cheng
Qiang Yan and Shi Sun Xi. This report has been prepared for inclusion in the offer document of AsiaPhos
Private Limited in connection with the initial public offering of its shares on the Catalist Board of the
SGX-ST.
The Mineral Resource estimation comprises two deposits:
Cheng Qiang Yan Property A single phosphorite bed deposit; and
Shi Sun Xi Property A single phosphorite bed deposit.
Mianzhu Norwest is in the process of rehabilitating the previous operations of both the Mines and is
working on completing the new processing plant and related infrastructure. A sufcient amount of the
required engineering, environmental and modications have been completed. This work in conjunction
with historical production data allows for the preparation of conceptual nancial models but additional
exploration and detailed engineering work is still required in order to meet international requirements
for the denition of Reserves and demonstrate project feasibility. This work largely entails underground
development, exploration drilling and more extensive mine planning to support estimation of Reserves
and production forecasts both in short and long term mine plans.
J-13

WGM has elected to summarize all the related operational information and assumptions for the modifying
factors available to date in Chapter 24 rather than under individual headings in recognition that additional
studies as detailed in the capital budgets are still required in some of these areas to meet NI 43-101 and
JORC Reserve denition and meet project feasibility requirements.
2.3 SOURCES OF INFORMATION
In conducting this study WGM relied on unpublished internal reports and other information supplied by
Mianzhu Norwest and the geological publications of the government of PRC. While WGM is unable to
verify some of the information presented in these reports, WGM has no reason to believe that it is not
representative.
James Spalding, Professional Geologist, WGM Senior Associate Geologist, Ross MacFarlane, WGM
Senior Associate Metallurgical Engineer and Mr. Jack Beichen Yue, WGM Junior Engineer conducted
a site visit from February 23, 2010 to March 3, 2010. The second site visit was conducted by Ross
MacFarlane, WGM Senior Associate Metallurgical Engineer and Mr. Yue, WGMs Junior Engineer on
November 27 and 28, 2011. The third and fourth site visits were conducted by Mr. Yue, WGMs Mining
Engineer on May 31, 2012 and November 26-28, 2012. Donald Hains, Senior Associate Industrial Mineral
Specialist reviewed the work previously completed by James Spalding (who retired from active practice
for personal reasons in 2011) and has co-authored this report with Mr. MacFarlane.
During the initial site visits, Mr. Yue acted as an interpreter in discussions with personnel in the PRC and
client representatives.
A list of documentation reviewed and other sources of information are provided in the References
section at the end of this report. In addition to these references, due diligence visits in 2010 and
2011 were made by WGM to the project sites, and to the Mianzhu Norwest elemental phosphorus
manufacturing facility. In 2010 visits were made to the Geological Institute charged with the past
exploration programs and interviews were held with the primary Chinese geological consulting rm, the
Sichuan Institute of Chemical Engineering and Geological Exploration
1
, and with the Mianzhu Norwest
personnel involved with the mining, transportation and processing operations. In 2011 and again on
May 31, 2012 and November 26-28, 2012, site visits were made to the downstream processing facility
construction site at the New Gongxing Site and the Mines.
In preparation of this report, the qualied persons have taken into account all relevant information
supplied by the directors of the listing applicant.
2.4 DETAILS OF PERSONAL INSPECTION OF THE PROPERTY
WGMs team initially consists of G. Ross MacFarlane, Senior Associate Metallurgical Engineer for WGM,
James S. Spalding, Senior Associate Geologist for WGM, and J. Beichen Yue Junior Mining Engineer
for WGM, visited the Mianzhu Norwest property initially from 23
rd
to 27
th
of February, 2010. The team,
accompanied by General Manager Mr. Wang Xuebo and Chief Engineer Mr. Luo, visited Cheng Qiang
Yan on February 24
th
, 2010 and entered Level 15 to inspect the damage caused by the Earthquake. The
team was not able to visit Shi Sun Xi due to inaccessibility at the time. On February 25
th
, 2010, the team
visited the old processing facility to investigate the damage to the furnace, plant and other equipment.
The team also conducted a thorough interview with the Mianzhu Norwests staff, including Mr. Wang,
Mr. Luo, Mr. Chia (nancial ofcer) and other technical personnel. On February 26
th
, 2010, the team,
guided by Mr. Luo, visited the Chemical Geological Exploration Institute of Sichuan Province to review
the geologic data. Further discussion with senior management of Mianzhu Norwest was conducted on
1
The Sichuan Institute of Chemical Engineering and Geological Exploration has not provided its consent for the purposes of Sec-
tion 249 of the Securities and Futures Act (Chapter 289) of Singapore (SFA) to the inclusion of its name, its reports and other
information extracted from its reports which are referred to here and in other parts of this Technical Report and therefore is not liable
for such information under Sections 253 and 254 of the SFA.
J-14

February 27
th
, 2010 in the morning before Mr. MacFarlane and Mr. Yue returned to Beijing. Mr. Spalding
spent two more days in Mianzhu City to review technical details with Mianzhu Norwests technical staff
before returned to Beijing on March 1
st
, 2010.
WGM conducted a second visit from November 27 to November 29, 2011. Mr. G. Ross MacFarlane and
J. Beichen Yue arrived in Mianzhu City on the 27
th
of November. The next day, accompanied by General
Manager of Mianzhu Norwest Mr. Wang Xuebo, WGM staffs entered Level 8 at Cheng Qiang Yan, and
Level 1950 at Shi Sun Xi. On November 29
th
, WGM staffs visited the old processing facility site to exam
the relocation progress, and reviewed the development at the new Plant. Mr. MacFarlane and Mr. Yue
returned to Beijing that evening.
WGM conducted a third site visit on May 31, 2012, J. Beichen Yue accompanied by General Manager of
Mianzhu Norwest Mr. Wang Xuebo, visited Mianzhu Norwests two Mines and the process Plant. Both
visited the new adit, which leads to the newly acquired Level 2140 at Cheng Qiang Yan and inspected the
new ground support at the widened Level 1815 at Shi Sun Xi to review the status of the mine restoration
and exploration, access road rehabilitation and processing facility construction. The most recent site visit
by WGM on November 26-28, 2012 was carried out by J. Beichen Yue of WGM accompanied by Mianzhu
Norwest Mine General Manager, Mr. Luo and Mianzhu Norwest Safety Manager Mr. Meng, who visited
the two Mines and the process plant.
Mr James S. Spalding, and Mr G. Ross MacFarlane who visited the Mianzhu Norwest mine sites and
Mr Don Haines who contributed to the documentation of the technical report all fulll the requirements
to be Qualied Persons as specied by National Instrument 43-101. They also meet the denition of
Qualied Person set out under section B of the listing manual of the SGX-ST.
The Qualied Persons and Joe Hinzer as well as other directors and substantial shareholders of
WGM and their associates are independent of AsiaPhos Private Limited, its directors and substantial
shareholders. The Qualified Persons and Joe Hinzer as well as other directors and substantial
shareholders of WGM and their associates do not have any interest, direct or indirect, in AsiaPhos
Private Limited, its subsidiaries or associated companies and will not receive benets other than
remuneration paid to the Qualied Persons in connection with the qualied persons report. Remuneration
paid to the Qualied Persons or WGM in connection with this report is not dependent on the ndings of
this report.
2.5 UNITS AND CURRENCY
Units of measurement used in this report conform to the SI (metric) system. Tonnages are presented
in tonnes (t) equivalent to 1,000 kilograms (kg), metric tonnes per annum (tpa) or metric tonnes per
day (tpd). Linear measurements in metres (m), square metres (m
2
), cubic metres (m
3
), kilometres
(km), square kilometres (km
2
).
All currency in this report is in US dollars (US$) unless otherwise noted. The Conversion rate from RMB
to US$ used in this report was 6.3 being the exchange rate as at March 14, 2012. To complete the
nancial analysis of the Mianzhu Norwest 2013 business plan, an exchange rate of 6.13 was used based
on the conversion rate on May 9, 2013.
J-15

2.6 DEFINITIONS
The following are the terms and their denitions used throughout the report.
TABLE 1.
LIST OF DEFINITIONS
Terms Description
NI 43-101 National Instrument for the standards of disclosure for mineral projects for
listing with Canadian regulators TSX/TSXV etc. (revised June 30, 2011).
JORC The Australasian Code for Reporting of Exploration Results, Mineral
Resources and Ore Reserves that sets out minimum standards,
recommendations and guidelines for Public Reporting in Australasia of
Exploration Results, Mineral Resources and Ore Reserves (as revised).
CIM Standards Standards, set by Canadian Institute of Mining Metallurgy and Petroleum,
to establish denitions and guidelines for the reporting of Exploration
Information, Mineral Resources and Mineral Reserves in Canada (last
revised Nov. 2010).
The Wenchuan Earthquake A Richter scale 8.0 magnitude earthquake on May 12, 2008 with epicenter
in Wenchuan County, Sichuan, China.
The Landslide The landslide that occurred in August 2010 that damaged the access road
to the mining activities of Mianzhu Norwest and neighbouring operations.
Rock slide The falling of rocks down the side of the mountain due to slope instability,
often caused by heavy raining or local shocks.
Mtpa Million tonnes per annum.
Net Cash Flow The total cash minus the total liability over a given period of time.
Base Case Financial model using most reasonable/conservative assumptions.
Phosphorite rock
Phosphorite Bed
A phosphate bearing sedimentary rock with a high enough content of
phosphate minerals to be of economic interest.
A continuous layer or rock unit of phosphate bearing rock.
Phosphorite material The chemical component, which is a part of phosphorite deposit that is
used to form the nal product.
Phosphorite, Phosphorite Resources,
Phosphoritic Deposit and Phosphate
Deposit
The rock unit that contains the Phosphorite rock with the description and
economic context.
Reserve Denition Drilling The type and extent of drilling including the procedures followed to identify
Mineral Resources and Reserves.
Rehabilitating The reconstruction and restoration of the infrastructures and installations
to allow continuation of the exploration, development and mining
operations.
J-16

Terms Description
Exploration information The geological, geophysical, geochemical, sampling, drilling, analytical
testing, assaying, mineralogical, metallurgical and other similar information
concerning a particular property that is derived from activities undertaken
to locate, investigate, dene or delineate a mineral prospect or mineral
deposit.
Mineral Resource See Section 14.2
Inferred Mineral Resource See Section 14.2
Indicated Mineral Resources See Section 14.2
Measure Mineral Resources See Section 14.2
*Mineral Reserve See Section 14.2
Probable Mineral Reserve See Section 14.2
Proven Mineral Reserve See Section 14.2
Feasibility study a comprehensive study of a deposit in which all geological, engineering,
operating, economic and other relevant factors are considered in sufcient
detail that it could reasonably serve as the basis for a nal decision by a
nancial institution to nance the development of the deposit for mineral
production.
Preliminary feasibility study;
pre-feasibility study
a comprehensive study of the viability of a mineral project that has
advanced to a stage where the mining method, in the case of
underground mining, or the pit conguration in the case of an open pit, has
been established, and which, if an effective method of mineral processing
has been determined, includes a nancial analysis based on reasonable
assumptions of technical, engineering, operating, economic factors and
the evaluation of other relevant factors which are sufcient for a qualied
person, acting reasonably, to determine if all or part of the Mineral
Resource may be classied as a mineral reserve.
* Mineral Reserve is dened by CIM denition (as mandated by NI 43-101) and Ore Reserve by JORC. In order to avoid
confusion in this report the term Reserve or Reserves are used throughout with the meaning as described.
J-17

3. RELIANCE ON OTHER EXPERTS
This updated Technical Report has been prepared by WGM for AsiaPhos Private Limited, the holding
company of Mianzhu Norwest. The information, conclusions, opinions, and estimates contained herein
are based upon:
information available to WGM at the time of preparation of this report;
assumptions, conditions, and qualications as set forth in this report; and
data, reports, and opinions supplied by Mianzhu Norwest and third party sources listed as
references.

WGM has relied on Mianzhu Norwest for information regarding the current status of legal title, property
agreements, corporate structure, taxes, and environmental information and status. WGM has not
researched property title or mineral rights for the Mines under study and expresses no opinion as to the
title and ownership status of the Mianzhu Norwest Mines and Plant.
This NI 43-101 and JORC compliant Technical Report on the phosphorite Resources on Cheng Qiang
Yan and Shi Sun Xi in Sichuan Province has been completed with reliance on numerous geological and
technical studies previously prepared by various government and related organizations in the PRC.
While WGM has not been able to verify the data presented, WGM has no reason to believe that the
information presented in these reports is not representative.
WGM assessed the project data and geology along with developing a computer model of each of the
deposits to complete the deposit evaluation and the phosphorite Resources assessment for this project.
This work was conducted and supervised by James Spalding, Senior Associate Geologist, in 2010 and
reviewed by Donald Hains, Senior Industrial Minerals Specialist in March 2011.
While WGM has not veried all the assays completed for the previous eld programs as the geological
work was completed by experienced and well-regarded exploration personnel and the writers found no
reason for doubting the accuracy of their work or their conclusions. The data available from the historical
drilling and the associated sample analyses have been individually reviewed by WGM and these data
generally support the conclusions previously reached.
WGM hereby consents to the inclusion of our name and all references thereto in the Valuation Report
prepared by Jones Lang LaSalle Corporate Appraisal and Advisory Limited for the preparation of an
independent valuation of the fair market value of the Mines and the processing plant located at the New
Gongxing Site.
J-18

4. PROPERTY DESCRIPTION AND LOCATION
4.1 LOCATION
The immediate area of Mianzhu Norwests Mines is located in the district of Mianzhu City and An Xian
County near the regional junction of virgin forests in the alpine zone. The topography is extremely rugged
with steep mountains and valleys or canyons, with vegetation cover. This area is strongly divided by
topographic features which affect the local micro-climates in any given area. The overall trend of the
mountains and major valleys generally is northeast to southwest. The elevations of the Mines range
from 3,200 m to about 1,800 m. Each of the properties, Cheng Qiang Yan and Shi Sun Xi, is dened by
existing mining and exploration permits (one each) with surveyed coordinates.
The existing mining permit for Cheng Qiang Yan is about 1.53 km wide E-W and is about 1.10 km long
N-S. The area of the property, specied by the issued mining permit is approximately 1.6491 km
2
.
Topographic elevations range from 2,240 to 2,570 m. There is a single phosphorite bed present on the
property which averages about about 5.0 m in thickness with an average grade of about 28.7% P
2
O
5
.
The bed strikes generally WNW-ESE and dips, generally, 45 to 55 to the NNE. Several minor normal
faults have been encountered at various elevations in the past with no signicant impact on the mining
operations. Mianzhu Norwest currently has an exploration license for Cheng Qiang Yan, for increased
mining depth, within the area already licensed for mining.
The existing mining permit for Shi Sun Xi is about 0.76 km wide E-W and is about 2.74 km long N-S. The
area of the property, specied by the issued mining permit is approximately 2.0237 km
2
. Topographic
elevations range from 2,420 m to 1,600 m. There is a single phosphorite bed present on the property
which averages about 7.4 m in thickness with an average grade of about 29.6% P
2
O
5
. The phosphorite
bed strikes generally about WSW-ENE and dips about 30 to the NNW. Mianzhu Norwest currently has
an exploration license for Shi Sun Xi to the east of the area, and nearly contiguous to the area already
licensed for mining.
There is one minable phosphorite bed in Mianzhu Norwests area of interest and it occurs on both
properties being described here although existing property reports use two identications. Sichuan
Institute of Chemical Engineering and Geological Exploration has placed this phosphorite bed in the
Devonian Period of the geologic time scale and given the bed a specic deposit type. The deposit
type is known as the Shi Fang type. As explained to WGM, the phosphorite bed is actually from the
Lower Cambrian Period and originally was deposited as the Meishucun Formation as were most other
phosphorite beds on other parts of the Mianzhu anticline area. There was a depositional hiatus from
the Lower Cambrian to the Devonian Period at which time this phosphorite bed, in preference to others
in the area was severely weathered which created some internal structural changes and enrichment in
P
2
O
5
content. The internal structure changes and increases in P
2
O
5
content are documentable. WGM
questions whether this bed should be assigned to the Devonian Period or whether it should be more
correctly assigned to the Lower Cambrian. This discussion has no relevance to the resource statements
herein made. This discussion is extended in the geology sections of this report.
4.2 PROPERTY DESCRIPTION
The area which encompasses Cheng Qiang Yan and Shi Sun Xi is situated in the west-central portion
of Sichuan Province almost exactly on the physiological break between the extension of the Tibetan
highlands and the Sichuan Basin. The Mianzhu Norwest Mines are located between the regionally
dominant dening fault zones. Besides the regional lineament, the major geologic structures of the
immediate area include the Yangtze meta-platform (at depth), the Longmen Mountain (Shan)-Da Ba
Mountain (Shan) platform and marginal depression, the fold belt of Longmen Shan, and north-west wing
of the doubly-plunging anticline.
J-19

Figure 1. Project location map
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J-20

The Mianzhu Norwest Mines and mining operations are located about 45 km northwest (straightline
about 330) of downtown Mianzhu City under the jurisdiction of Qing Ping Town, Mianzhu City, Sichuan
Province, PRC. Mianzhu Norwests Mines are in the immediate area separated by about 8 km. The
properties are Cheng Qiang Yan (Mine #1) and Shi Sun Xi (Mine #2) and their geographic locations are:
Cheng Qiang Yan Shi Sun Xi
N313614.00 N 313837.00
E 1040014.00 E 1040443.00
It is approximately 40 km by road from Mianzhu Norwests new downstream processing facility located
in the Gongxing Town, Mianzhu City to the Cheng Qiang Yan (42 km to Shi Sun Xi). Mianzhu Norwests
downstream processing facility (plant) is located in the Gongxing Town, Mianzhu City and very near
the start of the Mian Yuan River canyon that leads to the Mines. The mine access haulage route passes
through Qing Ping Town (N313335.08; E1040653.89) at a distance of about 17 km from Mianzhu
Norwests plant.
Table 2 presents a summary of the Mianzhu Norwests assets which were compiled from the drawings
and records provided by the company.
TABLE 2.
SUMMARY OF ASSETS
Asset name / Country AsiaPhoss
Interest (%)
Development
Status
Licence Expiry
Date
Licence
Area
Type of Mineral,
Oil or Gas
Deposit
Remarks
Exploration Area
Cheng Qiang Yan / PRC 100 Development 9 April 2014 0.55 km2 Phosphate Exploration rights
Shi Sun Xi / PRC 100 Development 16 June 2014 1.28 km2 Phosphate Exploration rights
Mining Area
Cheng Qiang Yan / PRC 100 Development 9 December 2015 1.6491 km2 Phosphate Mining rights
Shi Sun Xi / PRC 100 Development 9 January 2020 2.02 km2 Phosphate Mining rights
4.3 ENVIRONMENTAL AND REHABILITATION
Mianzhu Norwest has indicated that the economic conditions of working the licenses are not considered
a signicant operational cost item. These include but are not limited to one time purchase fees for the
lands for the processing facilities, exploration and mining licence renewal and applications fees and
environmental and closure (abandonment) costs.
The company has also complied with and obtained the required Mine safety permits and has installed
waste water treatment facilities at the mine sites and has also budgeted for the improvement and
maintenance of access roads (in conjunction with its neighbours).
The company also provides monetary compensation for a timberland compensation and forest recovery
fund, bi-yearly and has set aside provisions for rehabilitation and reforestation upon mine closure. The
current surface areas at the mine sites are steeply inclined, poorly vegetated and subject to extensive
natural erosion and hence the costs for this are not signicant.

J-21

5. ACCESS, CLIMATE, LOCAL RESOURCES, INFRASTRUCTURE AND PHYSIOGRAPHY
5.1 ACCESS
Mianzhu Norwests mining operations and Mines are located about 45 km northwest (straightline about
330) of downtown Mianzhu City under the jurisdiction of Qing Ping Town, Mianzhu City, Sichuan
Province, Peoples Republic of China.
During WGMs initial site visit to this project, February 23 through March 3, 2010, practically the entire
length of the access road from Mianzhu Norwests Plant site to Mianzhu Norwests Mines, was under
reconstruction to repair the damages caused by the May 12, 2008, the Wenchuan Earthquake and strong
aftershocks. The Peoples Liberation Army (PLA) was in charge of the rough work (pioneering) in this
reconstruction process and individual contractors were completing the nal grading and reconstruction
efforts. After the 2010 site visit the mine access road was blocked by the Landslide that suspended
phosphate rock haulage down the valley from August 2010 to November 2010. At the time of the
site visit in 2011, the haulage road down the valley had been restored to basic access with major
reconstruction still taking place. Many parts of the road were substandard presenting barely passable
conditions with continuing hazards from rock slides and substandard conditions.
The PLA had a major realignment of the valley road under construction with the expected completion
in 2015. At the time of the site visit in 2011, the PLA had completed a major rework of the river channel
above and below the town of Qing Ping. In 2010, access to the Cheng Qiang Yan property required
4-wheel drive vehicles and the access road to the Shi Sun Xi property was not passable due to the
Landslide in the immediate area of the mine development activity at that time. Access to the Shi Sun
Xi to allow restart of development of the mine was gained in May 2011. At the time of the site visit
on May 31, 2012, the rehabilitation of the road from Hanwang Town to Qing Ping Town was nearing
completion, the entire length was paved and widened, and only the construction of one tunnel and a
water diversion installation remained to be completed.
Prior to the Wenchuan Earthquake, the Deyang-Hanwang rail line (762 mm rail gage) was operational,
providing the possiblility of rail-freighting phosphate rock and phosphate-derived manufactured products
to distant locations. The current condition of this line, or its operation, is reportedly resumed although the
rail station and rail yards in Hanwang Town were destroyed in the Wenchuan Earthquake.
5.2 CLIMATE
This area is strongly divided by topographic features which affect the local micro-climates in any given
area. In the western part of the area, which includes the Mianzhu Norwest Mines, the climate is a
medium and alpine humid/cold climate. The annual precipitation is about 1,050 mm. The months from
July to September are considered the rainy season (59% to 84% of annual average), and from November
to February is the snow and frost season. The maximum recorded 24-hour rainfall event is about 255
mm. The highest temperature is 36C (July) and the lowest temperature is -10C (January). There are
large diurnal temperature differences. The average annual evaporation rate is between 900 and 1,050
mm per year at the Mianzhu Weather Station. Hanwang Town (elevation ~700 m) sits in a subtropical
humid climate zone and has a continental monsoon climate, which means no extreme temperatures in
summer and winter. The average annual temperature is 15.7C and the annual rainfall hits 1,053 mm.
5.3 LOCAL RESOURCES AND INFRASTRUCTURE
The entire Hanwang Town area of Mianzhu City is under massive reconstruction efforts to repair
damages caused by the Wenchuan Earthquake. Complete towns and villages have been, or are being,
relocated within the connes of Mianzhu City connes. Entire industries have been, or are being,
relocated. At the time of the initial site visit, the area, around Hanwang Town resembled a single
extremely large construction site. Mianzhu Norwests old processing facility was damaged during the
J-22

Wenchuan Earthquake and operated at reduced capacity on phosphate rock purchased from other
operators in 2009. The old procesing facility prior to the quake included four furnaces; two of which were
damaged beyond repair in the Wenchuan Earthquake, with the remaining two refurbished and made
available for operation. The status of other manufacturing facilities in the area is unknown.
Subsequent to the 2010 site visit, the decision was made to relocate the processing facilities to a new
industrial site being developed approximately 3 km to the northeast in the Gongxing Town. The new
processing location under construction will consist of two sites separated by a public access road. One
site contains all the operations from receiving the rock from the mine to collection and production and
storage of the P
4
. The Plant includes crushing and screening, drying, mine rock storage and reclaim,
two 10,000 tpa P
4
furnaces and storage facilities. The Plant includes gas scrubbers and water treatment
facilities to better control environmental issues. This site was under construction at the time of WGMs
November 2011 visit with civil work complete and mechanical and electrical installations in progress.
Rock from the #1 Mine was being stockpiled on the site. At the time of the site visit in May 2012, all
major facilities had been installed. At the time of the most recent site visit in November 2012, the
production from both Mines were stockpiled, crushed and sold to other factories.
The second site separated by a public access road will contain all the operations associated with
the SHMP, the STPP and a thermal phosphoric acid plant along with the product packaging, storage
and handling facilities. At the time of the site visit in November 2011, this site was at an early stage
of constructing foundations for the facilities that were being prepared for dismantaling at the original
processing site and erection at the new site. This area will also provides ofces for Mianzhu Norwest
and an area for future expansion of their product line. At the time of the site visit in late 2012 the two
plants from the original site had been relocated and erected at the new site and mechanical electrical
installation was in progress. The original site had been reclaimed and turned over to the local
government. The new site is located near a cement plant that will take the furnace slag and near a major
power substation that will supply power for the site and electric arc furnaces.
Although not yet in operation, the quality of construction at the Plant location, the site layout with more
extensive gas scrubbing, and water containment and treatment will provide Mianzhu Norwest with a
substantial improvement in their operation and better control of any environmental impacts.
5.4 PHYSIOGRAPHY
The immediate area of the Mines is located in the district of Mianzhu City and An Xian County near
the regional junction of virgin forests in the alpine zone. The topography is extremely rugged with steep
mountains, valleys/canyons, with vegetation cover. The Wenchuan Earthquake and strong aftershocks
caused numerous large-scale landslides and slope failures which removed much of the slope vegetation
along the access road from Qing Ping Town to the deposits. The overall trend of the mountains, generally,
is southwest to northeast. The terrain is dened as steeply sloping with multiple scree (loose rock) slopes
and inherent instability from slopes close to failure. In addition to steep bare rock at the surface, the
remaining parts of the vegetation are intact. The entire area is too steep to support any farming or animal
husbandry industries. The chief employment in the area between Hanwang Town and Mianzhu Norwests
Mines is centered on state-run and private phosphate mining as well as a state-supported/directed
timber industry. There are some small areas between Qing Ping Town and Hanwang Town that appear to
support small familial gardening/farming.
J-23

6. HISTORY
In 1968, the #101 Geological Team from the Sichuan Bureau of Geology conducted a 1:50,000 traverse
geological survey in this region and collected some information about the distribution of the outcropped
phosphorite ledge (bed), the attitude and the thickness of the bed as well.
In the mid 1960s, the Secondary Regional Geological Survey Team from Sichuan Bureau of Geological
conducted a regional survey in the area. In 1970, they submitted 1:200,000 report titled Regional
Geological Survey Report of PRC Mianyang Region.
From 1990 to 1994, the Chemical Prospecting Team from Sichuan Bureau of Geology and Mineral
Resources carried out 1:50,000 regional survey in this region and submitted a report in 1995 entitled the
Specication of Geological Map in PRC Qing Ping Region.
The school-run Cheng Qiang Yan Phosphate Mine in Mianzhu City, An Xian County was administratively
owned by the Sichuan Mianzhu School-Run Enterprise Group Company Co. Ltd., a group-owned
enterprise, which was founded in 1994. It has been reported that the mine produced 150,000 tons of
mineralized rock between 1994 and 1999 but the actual boundaries of the property are unknown.
Anecdotal evidence indicates that an open-pit mine was operating during this period.
In 1996, Sichuan Institute of Chemical Engineering and Geological Exploration conducted a geological
survey at Zai Ping Phosphorite Mine, which neighbours the Cheng Qiang Yan mine to the west.
Subsequently, the Institute submitted the report entitled Census Survey of Geological Report of Zai Ping
Phosphorite Mine in Mianzhu County, Sichuan Province.
survey of the Cheng Qiang Yan Mine and submitted a report entitled Census Survey of Geological
Report for Jia Pi Gou Ore Block of Chang He Ba Phosphorite Mine in Mianzhu City, Sichuan Province.
survey of the Cheng Qiang Yan Mine and submitted a report entitled Census Survey of Geological
Report for Cheng Qiang Yan Phosphate Mine at Qing Ping Town in Mianzhu City, Sichuan Province.
In 2002, operations of the mine were acquired by Mianzhu Norwest. Arising from a restructuring exercise
completed in 2013, AsiaPhos Private Limited became the holding company of Mianzhu Norwest. From
2002 until the Wenchuan Earthquake, Cheng Qiang Yan produced and shipped approximately 379,000
tonnes of phosphate rock.
For Cheng Qiang Yan, the mining license was renewed on March 9, 2011, and issued to Mianzhu
Norwest. The corner points of the renewed license remain the same and the renewed license is in force
until December, 2015 with an approved production rate of 50 kt/a. The permit encompasses an area of
1.6491 km
2
. The mineable depth approved with the new permit is between the elevation of 2,570 m and
2,240 m. The mining permit license number is C5100002011036120107965.
For Cheng Qiang Yan, the current exploration permit was issued on April 1, 2010 and expired on
April 9, 2012. The permit has been renewed on March 22, 2012 and remains valid until April 9, 2014.
The area encompassed by the exploration permit is 0.55 km
2
. The exploration permit license number is
T51520080403010704.
At Shi Sun Xi, in 1992, crews (afliation unknown) constructed a mining adit at the upper part of
the deposit. However, the operation was closed in 2000 due to consistently poor production and
unsatisfactory prot caused by a poor adit location and design. Anecdotal evidence indicates that an
open-pit mining operation was operating during this period.
J-24

Before foreign investment was introduced (Mianzhu Norwest), two mining adits were constructed
at elevations 1841 m and 1872 m near the lower part of the deposit in 2001 and 2002, but they were
abandoned because mineralization was not encountered at the expected locations.
The east borderline of the mining permit was in dispute until August 2005 due to an overlapping of the
east boundary line of the Shi Sun Xi Phosphate Mine and west boundary line of the Long Lin Phosphate
Mine. The resolution, in summary, moved the east boundary line of the Shi Sun Xi Phosphate Mine, in
parallel, 60 m towards the west. However, in the Additional Exploration of Geological Report for Sichuan
Mianzhu Norwest Phosphate Chemical Company Ltd (Shi Sun Xi Phosphate Mine) submitted by Sichuan
Institute of Chemical Engineering and Geological Exploration in October, 2005, the reportedly retained
phosphorite reserves were still based on the previous boundary line denition. The WGM Resource
estimate is based on the revised boundary location.
The report entitled Additional exploration of geological report for Sichuan Mianzhu Norwest Phosphate
Chemical Company Ltd (Shi Sun Xi Phosphate Mine) was submitted by Sichuan Institute of Chemical
Engineering and Geological Exploration in October, 2005 which contained a reserves summary
(resources) developed using PRC standards of classication. The reference above indicates an incorrect
eastern boundary line was used in this estimation.
In 2005, with the hope to develop the local economy to effectively take advantage of the resources,
increase mining capacity, and prot margins, Mianzhu Norwest (Shi Sun Xi) contracted the Coal Design
& Research Institute of Sichuan Province
2
to make a preliminary design for an increase in the production
capacity from 100 kt/a to 200 kt/a.
Under the contractual commitment, the engineering technical personnel of the Institute together with their
counterparts in Mianzhu Norwest in December 2005 developed the mine design criteria and operational
parameters that resulted in a series of reports being issued. Based on this integrated work the following
reports were issued:
Mineral Resources Development and Utilization Solution for Sichuan Mianzhu Norwest Phosphate
Chemical Company Ltd (Shi Sun Xi Phosphate Mine) submitted by Coal Design & Research
Institute of Sichuan Province in November, 2005. This report generally described the phosphate
mineralization and location based on the early exploration work and Mianzhu Norwests exploitation
activities at that time;
Sichuan Mianzhu Norwest Phosphate Chemical Company Ltd. (Shi Sun Xi Phosphate Mine)
Initial Design of Expansion Program submitted by Sichuan Coal Design and Research Institute in
February 2006. This was a mine redesign study to increase production to 200 kt/a; and
Sichuan Mianzhu Norwest Phosphate Chemical Company Ltd. (Shi Sun Xi Phosphate Mine)
Initial Design of Expansion Program Safety Procedures submitted by Sichuan Coal Design and
Research Institute in February 2006. This was the safety procedures for the expansion program,
and it was introduced as a stand alone report.
2
The Coal Design & Research Institute of Sichuan Province has not provided its consent for the purposes of Section 249 of the
SFA to the inclusion of its name, its reports and other information extracted from its reports which are referred to here and in other
parts of this Technical Report and therefore is not liable for such information under Sections 253 and 254 of the SFA.
J-25

For Shi Sun Xi the mining license was renewed in November, 2005 by Sichuan Provincial Bureau of
Land and Resource. The license number was 5100000530733 and is valid from December, 2005 until
December, 2015, with the approved production capacity at 100 kt/a. On March 9, 2011, the mining
license was issued for this property to Mianzhu Norwest. The corner points under the renewed license
remain the same and the renewed license is in force until January 9, 2020 with an approved production
rate of 200 kt/a. The area encompassed by the mining license is 2.0237 km
2
. The mineable depth
approved with the new permit is between the elevation of 2,420 m and 1,600 m. The mining permit
license number is C5100002010016120054374.
For Shi Sun Xi, the current exploration permit was issued on May 25, 2010 and remains valid until
June 30, 2012. The permit was renewed on March 22, 2012 and remains valid until June 16, 2014.
The area encompassed by the exploration permit is 1.28 km
2
. The exploration permit license number is
T51520080603010707.
J-26

7. GEOLOGICAL SETTING AND MINERALIZATION
7.1 REGIONAL, LOCAL AND PROPERTY GEOLOGY
The outcrops in the area of Mianzhu Norwests Mines, Cheng Qiang Yan and Shi Sun Xi, include Upper
Sinian strata, Upper Devonian strata, Lower Carboniferous strata, Lower Permian strata and small
amount of Quaternary system. In general, the geologic structures strike NE to SW and dip to North and
Northwest at 42-58.
This region is located in the middle part of the discordogenic faults at Longmen Shan Thrust Belt
and earthquakes frequently occur with some in the strong to severe categories. Most of the stronger
historical shocks in Sichuan Province were almost all located in the west of 104East longitude, and this
phosphorite-containing region lies right on this 104E longitude line. This line also is generally located in
the belt where the thickness of the earths crust is rapidly changing. The Longmen Shan area marks the
(rapid) transition from thick (60 km+) crust beneath the Tibetan Plateau (to the west) to continental crust
with normal thickness (around 40 km) beneath the Sichuan Basin. This area is also the boundary point
between Caledonian-age folding (Silurian Period) and Songpan-Ganzi geosynclines fold belt of Indosinian
orogeny of the early Mesozoic Era (Late Triassic Period).
The Mianzhu Norwests Mines, Cheng Qiang Yan and Shi Sun Xi, are both located between the faults F1
and F2, which are the principal dening regional lineaments. This area is also very near the juncture of
the Yangtzi meta-platform, the Longmen Shan - Da Ba Shan platform marginal depression, the fold belt
of Longmen Shan, and the north-west wing of a large double-plunging anticline. Geologically, this area of
Sichuan Province has been in the process of deformation for at least the last 600 million years (Figure 2).
7.2 GENERAL STRATIGRAPHY
The stratigraphic records for the Mines, Cheng Qiang Yan and Shi Sun Xi, are very similar although there
is still, seemingly, some confusion on the part of the local geological brigades as to the exact age of the
phosphorite bed of interest on the two properties. Although the geological age for the phosphorite bed
on the two properties is currently judged to be of Upper Devonian age, historically the bed has also been
assigned to the Lower Cambrian and/or Upper Sinian (Pre-Cambrian) ages. Each of these assignments
was complete with supporting geologic descriptions of the relevant strata.
There is one minable phosphorite bed in Mianzhu Norwests area of interest and it occurs on both
properties herein under discussion although existing property reports use two identications.
Sichuan Institute of Chemical Engineering and Geological Exploration has placed this phosphorite bed in
the Devonian Period of the geologic time scale and have assigned the bed a specic deposit type. The
deposit type is known as the Shi Fang type. As explained to WGM, the phosphorite bed is actually from
the Lower Cambrian Period and was deposited originally as the Meishucun Formation as were most other
phosphorite beds on other parts of the Mianzhu anticline area. There was a depositional hiatus from
the Lower Cambrian to the Devonian Period at which time this phosphorite bed, in preference to others
in the area, was severely weathered which created some internal structural changes and enrichment in
P
2
O
5
2
O
5
correctly assigned to the Lower Cambrian. This discussion has no relevance to the resource statements
made herein. This discussion is extended in the geology sections of this report.
J-27

Figure 2. Geology map of the Mianzhu City area
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J-28

However, there are no documentable traces of evidence, in readily accessible western literature,
supporting a period of phosphogenesis and accumulation in the Devonian Period in Asia and very few
from the rest of the world.
Given all of the above, this Technical Report will use the Upper Devonian Period age assignment for this
phosphorite bed as it is currently accepted locally (Table 3).
7.3 STRATIGRAPHY OF CHENG QIANG YAN
At Cheng Qiang Yan, the major outcrops on the property, and described in detail, are Upper Sinian,
Upper Devonian and small amount of Quaternary strata. The descriptions below are in ascending order
from oldest to youngest:
7.3.1 UPPER SINIAN GUAN YIN YA GROUP (ZBG)
The lower portion is a gray to purplish-red and layered pebbly sandstone with medium thickness. The
bottom is a granitic conglomerate. The upper portion is a purplish-red and layered metamorphosed
packsand (ne-grained sandstone) with thin to medium thickness. This is interbedded with muddy siltite
and with microlite dolostone and calcite dolostone. The thickness of this outcrop in the property area is
120 to 140 m. The bottom of this unit is in unconformable contact with stratum below, which is two-mica
granite.
7.3.2 UPPER SINIAN DENG YING GROUP (ZBDN)
This unit is distributed over most of the area. The upper portion of this unit is grayish white to light grey
dolostone with granular particles. The upper portion contains phosphate inlling of karstic cavities; lower
portion is light grey thick layered dolostone. The thickness ranges from 332 to 710 m. In general, this
unit is composed of thick-layered and agglomerated cryptocrystalline dolostone with colors ranging from
hoary to grey and with a fossil karst erosion surface the top appearing at to be a piedmont.
Based on rock characteristics, the Deng Ying group can be divided into 3 sequences, and the rst
sequence can also be divided into 3 layers. These same sequences can be traced far to the east at
least to the Three Gorges area of Hubei Province and beyond.
7.3.3 DENG YING GROUP 1ST SEQUENCE (ZBDN
1
)
1
st
layer (Zbdn
1
1
): grey to light grey dolomite with elegant trace, top is siliceous dolomite. Conformity
contact with Guan Yin Ya group below. Thickness: 220 to 250 m.
2
nd
layer (Zbdn
1
2
): this layer contains phosphate mineralization; it is sandy mudstone or muddy ne
grained sandstone with phosphate content, interbedded with grey to dark grey lens shape or granular
dolostone. An area with high P
2
O
5
was formerly dened as the Cheng Qiang Yan deposit. This was one
of the former age assignments for the phosphorite bed.
3
rd
layer (Zbdn
1
3
): grey to light color dolomite with elegant trace, lower portion is siliceous dolomite.
Contact with 2
nd
layer is siliceous dolomite. Thickness is 450 to 500 m, average around 480 m.
J-29

TABLE 3.
SHI FANG TYPE PHOSPHORITE DEPOSIT STRATIGRAPHIC COLUMN
SICHUAN PROVINCE, PEOPLES REPUBLIC OF CHINA
Era System Series Group Symbol Thickness
(m)
Rock and fossil description
Cenozoic Quaternary Holocence Q 0-41 Overburden, soil, sand gravel
Mesozoic Triassic Upper Xu Jia He T
3
114.8 Grey, greyish black, thin bedding of ne grained
siltstone, sandstone, mudstone and carboneous
shale
Middle Tian Jing
Shan + Lei
Kou Po
T
2
52 - 230 Yellowish grey to light grey, medium to thick
bedding of very ne grained dolomite with muddy
and calcareous texture, interbedded with yellowish
grey siltstone
Lower Jia Ling Jiang
+ Fei Xian
Guan
T
1
100 - 282 Purplish red thin to medium layered mudstone,
siltstone, interbedded with light grey thin limestone
Paleozoic Permian Upper Chang Xing +
Wu Jia Ping
P
2
130-245.7 Grey to greyish black, thick layered limestone.
Middle and lower portion is cherty limestone and
interbedded with carboneous shale. Contains fossil:
Synamulorla cf. cndiea Wangen
150-125 Dark grey, medium to thick layered limestone,
contains cherty. Purplish red iron containing
kaolinic mudstone and coal mineralization at
bottom
Lower Mao Kou
+ Qi Xia +
Liang Shan
P
1
160-200 Grey to dark grey, thick layered and granular
shape bioclastic limestone interbedded with shale.
Contains fossil: Neoscnwagrlna sp RerbeeRina
150-250 Light yellowish grey, dark grey, thick layered and
granular bioclastic limestone
150-17.90 Dark grey, medium to thick layered bioclastic
marlite interbedded with black carboneous shale.
Carboniferous Lower Yan Guan C
1
Y 5.19-55.55 Yellowish grey, greyish white, thin to thick layered
limestone. Fine to coarse grained dolomite at lower
portion, Dark red conglomerates at bottom.
Devonian Upper Sha Wo Zi D
3
S
2
24.52-360.5 Grey to dark grey, thick layered fine grained
dolomite. Interbedded with dark yellow, dark
red bluish grey clay dolomite. Sandy dolomite
at bottom. Contains fossil: Cyrtospriper sinesis
Grabau
D
3
S
1
0-75.3 Phosphate mineralization: Hydrous mica, claystone
from top to bottom, phosphate containing
kaolinite claystone, Parathion aluminum strontium
mineralization, and phosphate rock. Contains fossil:
Bcthrolepis sp and etc.
Neoproterozoic Sinian Upper Deng Ying Zbdn 282.38-710.49 Greyish white, light grey, granular shape
dolomite. Phosphate mineralization filled cracks
at upper portion. Light grey thick layer dolomite
at lower portion. Contains fossil: Renaleis sp,
Praesolenopora minutus, Balics sp
Guan Yi Zbg 480.11-580.20 Grey to dark grey, thick bedding, siliceous dolomite.
Contains siliceous rock, top portion is shattered.
Phosphate containing layer is on upper portion,
consists of black shale, phosphate rock, siliceous
phosphate rock, siliceous rock with phosphate
content. Lower portion is purplish red thin layered
shale, and greyish white medium to thick layered
quartz sandstone interbedded with quartz siltstone.
144.56 m thick.
Cheng Jiang
Formation
Greyish white coarse grained granite
Note: after Sichuan Institute of Chemical Engineering and Geological Exploration
J-30

7.3.4 Deng Ying Group 2
nd
SEQUENCE (Zbdn
2
)
This is located at Northwest part of the property. Lower portion is grey thin layered marlite and purplish-
red shale with collapse structures (karstic) locally. The upper portion is grayish-black, thin to medium
thick microlitic dolomite and dolomitic limestone interbedded with black shale. The thickness is over 50 m.
7.3.5 DENG YING GROUP 3RD SEQUENCE (Zbdn
3
)
Located at Northwest of the property. Light grey to dark grey color thick granular shape dolomite. The
middle and lower portion is siliceous dolomite with a thickness of 100 to 120 m.
7.3.6 UPPER DEVONIAN SHAWOZI GROUP (D
3
S)
Located in the Northwest of the property.
Lower Sequence (D
3
S
1
)
This sequence which contains the phosphate mineralization is the current age assignment for the Cheng
Qiang Yan phosphorite bed. The strata from the top to bottom, is clay layer, clay layer with phosphate
content, and siliceous rock. There is granular phosphorite locally and is generally described as being
composed of the grey or dark carbon hydromica claystone, phosphatic clays, siliceous phosphorite
and phosphorite. It has a thickness from 0 to 26.19 m. Where the claystone is exposed at the surface,
there is a risk of serious weathering. In addition, the claystone is vulnerable to being argillized, while
svanbergite (strontium aluminum phosphate sulphate hydroxide) and phosphorite, on the other hand, are
stable in thickness, hard in texture and good in stability.
The phosphorite bed is located at the top of the speckle dolostone fossil karst base of erosion of the
Upper Sinian series Deng Ying Group, and below the Upper Devonian Series Shawozi Group dolomicrite.
Within the mining and exploration license areas of the Cheng Qiang Yan deposit, the thickness of the
phosphorite bed ranges from 0.7 to 13.8 m with an average thickness 5.0 m. The P
2
O
5
content of the
bed ranges from 18.5% to 36.4% with an average of 28.7% P
2
O
5
. The strike of the phosphorite bed is
generally NE-SW and the dip of the bed is about 50
O
in a northwesterly direction. The contact interface of
the phosphorite and the bounding wall rock is clear and abrupt, both at the roof and at the oor.

Upper Sequence (D
3
S
2
)
Dolomite. The lower portion is a sandy-dolomite; the middle portion is yellowish-grey, grey, reddish
ne to mid-sized granular dolomite, also interbedded with grey to light-bluish grey, thin layered clay and
muddy dolomite. The upper portion is grey, light grey thin to thick microlite to crystallite dolomite, with
visible black organic traces locally. The thickness is over 280 m with no visible upper limit. The Shawozi
GroupD
3
S
2
) contains abundant solution phenomena including crags and crevices that exemplify
karstic terrane. The Upper Member is primarily composed of ne and medium-to-thick mesocrystalline
dolostone of grey or dark grey color; this stratum is distributed at the top of the Cheng Qiang Yan
mountain. According to the drilling information from adjacent properties, it is composed chiey of solution
phenomena crags and crevices. This stratum developed these karstic features due to strong weathering
during past geologic times.
7.3.7 QUATERNARY (Q)
This is scattered on the property; mainly as overburden and in valley-ll sediments. It consists primarily
of poorly weathered dolomite and limestone fragments as well as clay; up to 30 m thick.
J-31

7.4 STRATIGRAPHY OF SHI SUN XI
At Shi Sun Xi, the major outcrops on the property, and described in detail, are Upper Sinian, Upper
Devonian, Lower Carboniferous, Permian and a limited amount of Quaternary strata. The descriptions
below are in ascending order from oldest to youngest:
7.4.1 UPPER SINIAN DENG YING GROUP (ZBDN)
Upper-Mid Deng Ying Group (Zbdn
3
) - solution phenomena fracture features (Karst)
It is composed of thick-layered agglomerated cryptocrystalline dolostone from hoary to grey colors with
a fossil karst erosion surface top appearing at piedmont. The thickness of this unit is directly related to
the erosional surface. This supercial weathering feature has developed during various geologic times.
According to the drilling information from adjacent properties, the supercial erosion phenomena and
fractures were developed at the elevations where groundwater intensely uctuated during its geologic
history. The base Zd dolostone is dense and brittle, with karstic joint ssures well developed. When
encountered by mining operations, the developed fracture/ssure sections, it is possible for wall caving
and minor slumps to occur. The top of this group of strata is bounded by an unconformity.
Upper Devonian System Lower Shawozi Group D
3
S
1
Containing Phosphorite Bed
This unit is composed of the grey or dark carbon hydromica claystone, phosphatic clay, siliceous
phosphorite and phosphorite; composed of carbon hydromica claystone, phosphatic kaolinite claystone,
svanbergite and brecciated phosphorite. Where the claystone is exposed at the surface, there is a risk of
serious weathering. In addition, the claystone is vulnerable to be argillized; while svanbergite (strontium
aluminum phosphate sulphate hydroxide) and phosphorite, on the other hand, is stable in thickness, hard
in texture and good in stability. The strike of the phosphorite bed is generally E-W and the dip of the bed
is about 30

in a northerly direction.
Within the mining and exploration license areas of the Shi Sun Xi deposit, the thickness of the
phosphorite bed ranges from 1.1 to 13.8 m with an average thickness 7.4 m. The P
2
O
5
content of the
bed ranges from 17.8% to 32.2% with an average of 29.6% P
2
O
5
. The strike of the phosphorite bed is
generally E-W and the dip of the bed is about 30

to

40 in a northerly direction. The contact interface of
the phosphorite and the bounding wall rock is clear and abrupt, both at the roof and at the oor.
Upper Devonian System Upper Shawozi group (D
3
S
2
) - Solution Phenomena Fractures (Karst)
This is composed of ne and medium-to-thick mesocrystalline dolostone of grey or dark grey color.
This stratum is distributed in the middle of the property. The top of the Shawozi Group is marked as an
unconformity.
Lower Carboniferous Yanguan Group (C
1
y) - Solution Phenomena Fracture (Karst)
This is distributed in the middle and the north-west corner of the property and found as conglomeratic
dolostone, limestone, politic dolostone with its thickness of 23.44-153.04 m.
Permian system (P
1
q+m) - solution phenomena fracture (Karst)
This is distributed in the middle and southern part of the property and found as a thick layer of
biocalcarenite with grayish black or dark grey color and has a thickness >193.06 m.
Lower Permian System Liangshan Group (P
1
l)
This is distributed in the middle and north-west corner of the property. It is an intertwined stratum with
dark grey layered marlstone from thin to medium-thick and medium-thick layered dark claystone. It is
held between the lentoid dark grey gravel biocalcarenite with a thickness of 16.60-18.70 m, with the
stratum being stable and consistent.
J-32

7.4.2 QUATERNARY SYSTEM (Q)
The brecciated sedimentation is composed of yellow clay, clayey loam with gravels, and is 0-82.06 m in
thickness and deposited at slight grade with the terrain and on both sides of the valley.
7.5 STRATIGRAPHY OF THE PHOSPHORITE BED
Only a detailed description of the phosphorite bed at Shi Sun Xi (Coal Design & Research Institute of
Sichuan Province2006) has been presented for review for this Technical report. No similar description
for Cheng Qiang Yan has been found in the review materials. However, since the phosphorite bed at both
locations is geologically the same and of the same age, the description below can be applied, in general,
to the bed at Cheng Qiang Yan which is only 8 km distant.
The phosphorite bed has a clear lithological zonation. From the bottom to top there is brecciated
phosphorite, dense phosphorite, lutaceous phosphorite, svanbergite, siliceous phosphorite, and
phosphatic claystone.
The phosphorite bed often leads to vertical zoning that is not complete, or is partially missing, due to the
constraints of variability of the karst base (oor material) at the top of the underlying Deng Ying Group
of strata. However the position is stable and gradation is in a normal sequence, as identied in regional
comparisons.
The mineral combination mainly includes apatite, collophanite, svanbergite, kaolinite and hydro-mica
among other minerals. However, from top to bottom the content of apatite and collophanite decreases
in the phosphorite bed, while that of kaolinite and hydro-mica increases. The svanbergite is generally
found in the central portion of the property. Phosphorite claystone (brecciated) is formed due to a sharp
increase of kaolinite and hydro-mica. A partial section of the bed appears as siliceous phosphorite.
The phosphorite bed is generally featured, by positive corpuscle-order gradation, a grain-size change
from coarse to ne going from the bottom to the top except for the mixed order and sizes of brecciated
phosphorite at the bottom of the sequence.
Physical conformation of the phosphorite bed is strictly controlled by the erosional surface of karstic
topography at the base of the bed. Usually the upper contact is regular and even while the lower contact
is irregular. Typical of the Shi Fang Type of phosphorite deposit, the phosphorite bed is located in the
space formed by the erosion process as a point of accumulation and the bed has transverse thickness
variations. The erosional aspects of deposition has a certain character of its own as the accumulation
of phosphorite develops along with erosion, and the phosphorite is accumulated in the lower part of
the erosional topography as a bed. The phosphorite bed is derived from the weathered and reworked
material from the Lower Cambrian Meishucun Formation.
7.6 GEOLOGICAL STRUCTURE
7.6.1 STRUCTURE OF CHENG QIANG YAN
The Cheng Qiang Yan property is situated in between two major, and regional, fault systems, faults
F1 and F2. Most of the faults specically on the property are reverse faults, typical of overthrust and
compressional terranes, and are identied as F201, F202, F203 and F205 and are actually a series of
fault systems, as following:
7.6.2 F205 NORMAL STRIKE SLIP FAULT
It is near the western boundary of the property, starting from the Southwest corner and 860 m long. The
fault is Visible in TC103. The strike of the fault system is generally N-S with a dip toward the west at 55.
The heave is 350 m and the throw is estimated at about 450 m.
J-33

7.6.3 F202 NORMAL FAULT
The fault is located in northeast of the property and around 230 m long. The brecciation zone is about
0.8 m wide. The strike of this fault system is generally toward the west with an azimuth of 259 and
dipping at 16 in an unspecied direction.
7.6.4 F201 REVERSE FAULT
The fault system is located in northeast of the site and about 140 m long with a visible 0.3 m wide
brecciation zone in TC102. Fault strikes NW with an azimuth of 316, dipping at 34 in an unspecied
direction. The throw is about 30 m and the heave is 40 m.
7.6.5 F203 REVERSE FAULT
This fault is located northeast of the property about 100 m away from F201 and is 120 m long. It strikes N
and NE with the dip towards the N and NW and the dip angle, throw and heave are unknown.
F206 in previous reports was not found in this survey (mapping and sampling in the trench and tunnels),
so it is not included.
The locations and altitudes of Fault 201, 202, 203 have been adjusted based on the updated information
obtained in the latest survey (2009). In conclusion, the faults on the property generally strike NE to SW
with a monoclinal structure and dip toward NW to N at 43 to 58.
The strike of the phosphorite bed is generally E-W and the dip of the bed is about 50

in a northerly
direction.
7.7 STRUCTURE OF SHI SUN XI
The Shi Sun Xi property contains only one described fault. The F14 faulted zone strikes from SW to
NE and dips in an unknown direction at an unknown angle. The fault does not interfere with possible
mining operations under the existing mining permit but does inuence the phosphorite stratum under the
exploration license to the east of the mining permit.
The strike of the phosphorite bed is generally E-W and the dip of the bed is about 30

in a northerly
direction.
7.8 SEISMICITY
The Longmen Shan marks the tectonic contact between the Sichuan Basin to the east and the mountains
of western Sichuan and the eastern Tibetan plateau to the west. Marked by fast P wave (primary wave)
propagation to at least 250 km depth, the low-elevation and topographically at Sichuan Basin appears
to be a deeply-rooted, mechanically strong unit underlain by craton-like lithosphere that has resisted
Mesozoic and Cenozoic deformations that affected the surrounding regions. The slow seismic wave
propagation west of the Longmen Shan fault zone suggests that the mechanical strength is much lower
here than beneath the Sichuan Basin. The recurring earthquakes reect tectonic stresses resulting from
the relative motion between these tectonic units. Geological structures along the Longmen Shan suggest
a total displacements of tens of kilometres since the Late Cenozoic and GPS measurements constrain
active rates at a few millimetre per year.
The tectonic evolution of the Longmen Shan is complex and still only moderately understood. The
Longmen Shan marks not only the present boundary between the high topography of the Tibetan Plateau
to the west and the relatively undeformed Sichuan Basin to the east, but this region also marks the limit
of deformation during the Mesozoic Indosinian orogeny. During the Late Triassic to Early Jurassic, a
sequence of continental margin sediments and ysch were highly deformed and thrust eastward onto
the rocks of the Yangtze craton while the Sichuan Basin was accumulating clastic sediments as a fore
J-34

deep basin (Indosinian orogeny). The structures of the Longmen Shan region primarily reect this
Mesozoic deformation; Cenozoic faults and folds tend to parallel and often reactivate Mesozoic structures.
Cenozoic deformation in the Longmen Shan is difcult to constrain, but there is evidence for right-lateral
strike-slip, thrusting, and normal faulting on several different structures. The fault that appears to have
broken on the Wenchuan Earthquake is at or very near the boundary between the Precambrian rocks
of the Pengguan Massif and the Mesozoic fore deep sediments of the Sichuan Basin. The fault has a
history of mostly right-lateral strike-slip and a smaller amount of thrust motion.
The Longmen Shan marks the (rapid) transition from thick (60 km+) crust beneath the Tibetan Plateau to
continental crust with normal thickness (around 40 km) beneath the Sichuan Basin.
The region is located in the middle part of the discordogenic fault at Longmen Shan, where earthquakes
frequently occur and often very strongly. The strongest shocks to have ever occurred in Sichuan
province were almost all located in the west of 104east longitude, and this region lies right on this
line. The borderline is generally located in the belt where the thickness of the earths crust is changing
as mentioned above. It is also the border point between Caledonian folding (Silurian Period) and the
Mesozoic Songpan-Ganzi geosynclines fold belt in the Indosinian orogeny.
According to GB18306-2001 Chinas earthquake motion peak acceleration division map (PRC National
Standard Amendment No.1, June 11th, 2008), the earthquake motion peak acceleration in this region
is 0.20g, the basic earthquake intensity is Mercalli VIII, the earthquake response spectrum eigenperiod
is 0.35. According to the Sichuan Province tectonic system and earthquake distribution maps in 1980,
Mianzhu county annals and the quartz mine ESR age results explored in the fault zone of this region
conrm that this region is located in a later structured active belt, where minor shocks have frequently
occurred during geologic times. It was recorded that there were more than 10 earthquakes that affected
this region; such as on March 22, 1983, when an earthquake occurred in Qing Ping Town in Mianzhu
City, the epicentre was located at 10417 East longitude and 3134 North latitude with a magnitude
of 4.2. Fortunately it caused little damage due to its mild intensity. However, Qing Ping Town became
a severely damaged area after the Wenchuan Earthquake. Most of the buildings were destroyed and
other damage was devastating. Based on the recorded seismic history in the area along with the geologic
features and structures, it is expected that earthquakes will continue in the future. The intensity of major
earthquakes could again reach a Mercalli intensity VIII (equivalent to Richter scale between 6 and 7, and
mining construction as well as other projects should be planned and designed accordingly.
As an added note, during the site visit to Cheng Qiang Yan in late February 2010, an inspection of the
Level #15 drift was conducted by the WGM project team. While all surface facilities at the mine were
destroyed, the underground workings on level #15 showed little impact from the Wenchuan Earthquake.
Inspection of Levels #9 and #4 by other members of the Mianzhu Norwest mine operating personnel
revealed that these underground operations were also minimally affected by the earthquake.
7.9 MINERALIZATION
The phosphorite particles are mainly granular in shape but also arenaceous through recrystallization
processes. While the phosphorite is mainly granular, there are visible washing marks (brecciation)
at the base of the bed. The phosphorite mineral exists mainly of argillaceous phosphorite, siliceous
phosphorite, dense phosphorite and brecciated phosphorite. The phosphorite occurs in brecciated
structure, secondarily in arenaceous form with individual particles and dense structure. The latter is
developed as recrystallized and metasomatic in texture. The phosphorite is chiey lumpy in structure
and occasionally there are scour marks found at the base of the bed.
The phosphorite bed mainly includes four natural types, which are lutaceous phosphorite, siliceous
phosphorite, dense phosphorite and brecciated phosphorite.
J-35

The phosphorite mineral composition consists chiey of uroapatite and collophanite (70 to 80%) and of
clay minerals (3-10%) with an accompanying 1 to 10% quartz and 110% zirlite (an amorphous aluminum-
hydrate encrustation) as well as small amounts of pyrite, fragments of carbonate, ferric oxide, and chlorite.
The key element of commercial interest in the phosphorite mineral is phosphorus (P), which occurs in
the natural oxidized form as P
2
O
5
. According to the statistics from the trenches, mine underground
development and core drilling, the average P
2
O
5
content of the Resource at Cheng Qiang Yan is 28.7
percent. The similar value at Shi Sun Xi is 29.4 percent. Unfortunately, no other systematic analyses of
the oxides have been completed on the individual exploration and development samples so no detailed
analysis of chemical variations or particle-size analysis can be offered here. This is a deciency, but the
normal practice in the PRC.
The only comments on the chemical components of the phosphorite material which were presented for
review for this Technical report came from a report on Shi Sun Xi (Coal Design & Research Institute
of Sichuan Province2006). No similar discussion was found for the material at Cheng Qiang Yan.
However, given the geological situation and the geographical location of the Mines, the following general
discussion can be applied to both.
The Coal Design & Research Institute of Sichuan Province determined that the major gangue
mineralization in this phosphorite include MgO, Fe
2
O
3,
Al
2
O
3,
and CO
2
These gangue minerals will have
no impact on the P
2
O
5
quality or production and will report to the slag from the furnace operation. None
of the composited analyses were presented for evaluation of this Technical report. Using the results of
27 combined-analysis data in Huang Tu Keng block of Ban Peng Zi Phosphorite Mine, which is adjacent
to this mine, the key chemical components in their ore include P
2
O
5
, CaO, F, Fe
2
O
3
, Al
2
O
3
, SiO
2
, MgO,
and CO
2
, making up to over 90% of the total. Based on the analysis of these data, the following
summary has been prepared:
The content variation of MgO is between 0.05 and 3.32% and 0.72% in average; the variation
factor is 79%, which is unstable in variation. The content in the phosphorite is not uniform and
appears as a negative correlation with P
2
O
5
, in asynchronous regression. It is closely related
with the content of CO
2,
which is 2.68; lower than the requirement (MgO/P
2
O
5
<8) of the industrial
indexes, so it is a phosphorite of low magnesium content;
The content variation of Fe
2
O
3
is between 0.74 and 6.75% and averages 3.24%; with variation
factor of 63%, which is unstable in variation. The content in the phosphorite is not uniform and
appears as a negative correlation with P
2
O
5
in asynchronous regression. It is closely related with
the content of Al
2
O
3,
increasing synchronized; the ratio of Fe
2
O
3
/P
2
O
5
is 12%, higher than the Fe/P
requirement of the industrial indexes;
The content variation of Al
2
O
3
is between 1.2 and 8.79% and averages 4.01%; with a variation
factor of 52%, which is unstable in variation. The content in the phosphorite is not uniform and
appears negative correlation with P
2
O
5
, in an asynchronous regression. It is closely related with
the content of Fe
2
O
3,
increasing synchronized, the ratio of Al
2
O
3:
P
2
O
5
is 15%, higher than the Al/P
requirement of the industrial indexes; and
The content variation of CO
2
is between 0.64 and 6.28% and averages 1.59% with a variation
factor of 151%, which is extremely unstable in variation. It is not related with the content of P
2
O
5,
but it is in positive correlation with MgO. CO
2
content is lower than the requirement (CO
2
of 4%) in
the industrial indexes.
J-36

8. DEPOSIT TYPES
The primary phosphorite bed of economic interest at both Cheng Qiang Yan and Shi Sun Xi is of
sedimentary origin. From the work reviewed and interviews conducted for this report, it is believed that
the phosphorite beds are of different geologic ages. The geology reports from the two deposits differ
as to the geologic age of the phosphorite bed with the bed at Shi Sun Xi being of Devonian age. WGM
takes exception with this assignment believing that the phosphorite bed at Shi Sun Xi is more likely of
Lower Cambrian age and equivalent to the Meishicun Formation similar to the deposits on the east ank
of the very large anticline that forms the basis of most of Mainzhus phosphorite production. However,
whatever the age of the phosphorite, that determination has no impact on the Resources estimated for
the two properties which are separated by approximately 8 km.
The regional geologic map of the phosphorite production area of Mianzhu, supplied by the Sichuan
Institute of Chemical Engineering and Geological Exploration, indicates that the bed on both properties
is the same Devonian age. The geology report for Cheng Qiang Yan, with accompanying stratigraphic
descriptions, also written by the Sichuan Institute of Chemical Engineering and Geological Exploration,
indicates that the phosphorite bed is Sinian (Upper Pre-cambrian) age and located in the Deng Ying
Formation. The stratigraphic descriptions of the strata lying above the phosphorite bed at Cheng
Qiang Yan does not match the description of the equivalent strata from Shi Sun Xi. The Devonian age
assignment from the regional geologic map places the preferred stratigraphic location for the bed on
both properties as disconformably resting on the Deng Ying Formation, a position and circumstance
similar to the Meishucun Formation on the eastern ank of the anticline and the stratum from which the
state-run Qing Ping phosphorite mine operated, at rates approaching 1,000,000 tpa until the Wenchuan
Earthquake.
Current data reviewed indicate that there was no significant sedimentary phosphogenesis and
accumulation event in the Devonian anywhere in Asia and only minor occurrences elsewhere in the world
are assigned to this age. To WGMs knowledge, with the exception of Shi Sun Xi and one other, all other
producing phosphorite occurrences in Sichuan are reported as Upper Sinian or Lower Cambrian in age
(either Deng Ying Formation or Meishucun Formation). However, scientic journals, from the PRC on this
subject are difcult to nd and evaluate.
Current regional geologic data and reports indicate that a more likely age for the Shi Sun Xi phosphorite
bed (if, in fact, it is different from Cheng Qiang Yan) is Lower Cambrian and it should be assigned, in
general, to the Meishucun Formation of that age which lies stratigraphically above the Deng Ying
Formation of the same age (approx). WGM has no doubts that the roof material for the Shi Sun Xi bed is
Devonian and there is a signicant unconformity between the two strata just as there is an unconformity
between the phosphorite bed and the underlying Upper Sinian strata identied as the Deng Ying
Formation.
The Devonian age assignment for the phosphorite bed at Shi Sun Xi, as explained by personnel from
the Sichuan Institute of Chemical Engineering and Geological Exploration, requires a special designation
as to the type of the deposit. This type of Devonian phosphorite deposit is designated as the Shi
Fang Type in Sichuan Province. As explained, the phosphogenesis and accumulation events for this
type of deposit occurred originally in the Lower Cambrian age as the Meishucun Formation. During
the depositional hiatus and erosional events that occurred between the Middle Cambrian and Devonian
ages the phosphorite bed was severely weathered which increased the quality of the bed signicantly
compared to the Meishucun Formation. This is a natural beneciation process. During the initial
depositional events during the sea on-lap in the Devonian age, the Shi Fang Type beds were displaced
somewhat and incurred internal structural changes to the bed which was subsequently covered with mid-
to upper shelf Devonian marine sediments.
J-37

In WGMs opinion, if the age of the phosphorite bed at Cheng Qiang Yan is to be reclassied from Upper
Sinian Deng Ying Formation to the Devonian Shi Fang Type deposit, Sichuan Institute of Chemical
Engineering and Geological Exploration must return to re-examine the stratigraphic descriptions of the
sediments overlying the bed. Currently, these sediments are described in detail and classied as the
Deng Ying Formation.
J-38

9. EXPLORATION
Phosphorite exploration in this area began in 1968 and continued through the 1990s with regional
programs in the beginning and eventually culminating in site-specic property reports by various PRC
governmental ministries.
In 2002, operations of the Cheng Qiang Yan property were acquired by Mianzhu Norwest. From
2002 until the Wenchuan Earthquake, the Cheng Qiang Yan Phosphorite mine produced and shipped
approximately 379,000 tonnes of phosphate rock. Since the establishment of the current production by
Mianzhu Norwest, no exploration of the licences has taken place other than the advancement in the
understanding of the mineralization stemming from the active mining development sites. In addition to
advancing the estimated Resources, further exploration of the licensed areas could result in increasing
the Resources due to better understanding of the thickness of the mineralization and the local structures.
For Cheng Qiang Yan, the mining license was issued on March 9
th
, 2011, to Mianzhu Norwest.
The corner points on the renewed license remain the same and the renewed license is in force until
December, 2015 with an approved production rate of 50 kt/a. The permit encompasses an area of
1.6491 km
2
. The mineable depth approved with the new permit is between the elevation of 2,570 m and
2,240 m. The mining permit license number is C5100002011036120107965.
For Cheng Qiang Yan, the exploration permit issued on April 1, 2010 and valid until April 9, 2012 was
renewed on March 22, 2012 and now remains valid until April 9, 2014. The area encompassed by the
exploration permit is 0.55 km
2
. The exploration permit license number is T51520080403010704.
At Shi Sun Xi, in 1992, crews (afliation unknown) constructed a mining adit at the upper part of the
deposit. However, the operation was closed in 2000 due to consistent poor production and unsatisfactory
prot caused by a bad adit location and design.
In the period of 1990 to 2000, an organization, probably the Sichuan Institute of Chemical Engineering
and Geological Exploration, completed the trench excavations, geological descriptions, and phosphorite
sampling from the trenches on the Shi Sun Xi property and neighbouring plots of ground.
Before foreign investment was introduced (Sichuan Mianzhu Norwest Phosphate Chemical Company,
Ltd.), two mining adits were constructed at elevations 1,841 m and 1,872 m near the lower part of the
deposit in 2001 and 2002, but they were abandoned because mineralization was not encountered at the
expected locations.
In 2002, the Mines were acquired by Mianzhu Norwest.
In 2005, an organization, probably by the Sichuan Institute of Chemical Engineering and Geological
Exploitation, completed the drilling of three holes, the geological descriptions of the core samples, and
phosphorite sampling from the recovered drill core on the Shi Sun Xi property within the mining license
area.
In 2005, with the hope to develop the local economy to, effectively take advantage of the Resources
and increase the mining capacity and prot margins, Mianzhu Norwest contracted the Coal Design &
Research Institute of Sichuan Province to make a preliminary design for an expansion so that the
production capacity could increase from 100 kt/a to 200 kt/a at Shi Sun Xi.
J-39

10. DRILLING AND TRENCHING
The Cheng Qiang Yan geological dataset contains records for six trenches which are referenced in
either reports or on drawings. The trenches are identied as TC101, TC102, TC103, TC104, TC105 and
TC106. The dates of the eld work that excavated and sampled the trenches are unknown. However,
it is believed that the Sichuan Institute of Chemical Engineering and Geological Exploration, or its
predecessors, conducted the eld work sometime between 1990 and 2000, more likely during the mid-
1990s. Due to le storage problems at the Institute, none of the eld records were available for review, or
subsequent copying, during the WGM site-visit interviews.
At Cheng Qiang Yan, there are nineteen locations within the existing underground mine where organized
production control samples were collected. Each of these locations was surveyed and all samples
were collected in a similar manner. This work was completed by the Mianzhu Norwest and the samples
analyzed at the company laboratory in Hanwang Town, Mianzhu City. These are from lowest elevation
to upper elevations as follow: Level #15 (elevation 2,060 m) four samples; Level #9 (elevation 2,106 m)
two samples; Level #4 (elevation 2,169 m) three samples; Level #3 (elevation 2,211 m) three samples;
Level #8 (elevation 2,281 m) three samples; and Level #5 (elevation 2,385 m) four samples. These
sample data contain information regarding location, true thickness, elevation, %P
2
O
5
and %Fe
2
O
3
(13
points only). This work was conducted between 2002 and 2008 and the sample sites are contained, with
appropriate information, on company AutoCAD drawings of each working level. These nineteen sample
locations have been treated as trench locations for the work conducted by WGM.
The Shi Sun Xi geological dataset contains records for six drill holes and ve trenches referenced in
either the reports or on drawings. The drill holes are ZK701, ZK703, ZK705, ZK902, ZK903 and ZK1001.
Drill holes ZK701, ZK703 and ZK705 are located on neighboring properties and, as such, no detailed
information was transmitted by the Sichuan Institute of Chemical Engineering and Geological Exploration.
However, summarized data from these holes regarding the phosphorite bed appear on drawings that
were transmitted. Drill holes ZK902, ZK903 and ZK1001 are located on the Mianzhu Norwest mining
permit and, as such, detailed geologic logs and basic analyses were transmitted by the institute. The
drill holes by Mianzhu Norwest were completed between May and September 2005. The average drilling
rate for the three holes was 14.3 m per day (7-day weeks).
At Shi Sun Xi, the ve trenches are TC123, TC124, TC125, TC126 and TC205. Trenches TC123,
TC124 and TC205 are located on a neighboring property near the western extent of the mining license.
However, the Institute transmitted graphic logs with basic analyses for these trenches. Trenches TC125
and TC126 are located in the SW part of Mianzhu Norwests mining license and the graphic logs, with
analyses, were also transmitted by the Institute.
At Shi Sun Xi, there are two locations within the existing underground mine where organized production
control samples were collected. Each of these locations was surveyed and both samples were collected
in a manner similar to the Cheng Qiang Yan underground samples. This work was completed by Mianzhu
Norwest and the samples analyzed at the company laboratory in Hanwang Town Mianzhu City. This work
was conducted between 2006 and 2008 and the sample sites are contained, with appropriate information,
on company AutoCAD drawings of each working level. There is one location at the 1950 m level and one
at the 2,050 m level. These two sample locations, in the NW corner of the mining license, have been
treated as trench locations for the work conducted by WGM.
Although no eld operating records for the Shi Sun Xi drilling campaign were submitted for review, it
is assumed that the program was conducted in accordance with the typical Standards mandated by
the PRC National and Provincial governments and their guidelines. It is WGM opinion based on other
references that the PRC works to standards that are satisfactory to the purposes of this review.
Also standard in the PRC is the process to ascertain the variability of drill hole inclination where the
azimuth and dip of borehole direction were surveyed for every 150 m of drilling with any problems
corrected promptly and good results attained.
J-40

11. SAMPLE PREPARATION, ANALYSES AND SECURITY
11.1 SAMPLING METHOD AND APPROACH
Coring procedures used during eld campaign at Shi Sun Xi focused on the recovery of HX sized core
or equivalent. The core was recovered and placed into core boxes and then described in detail in the
eld. The core was then transported to the geological team headquarters for further description and
conrmation of both sets of descriptions. The chemical analyses of selected samples were probably
conducted by the 21
st
Laboratory of Chemical Geology and Mine of Sichuan Province
3
, considered to
be independent of the issuer, which is apparently associated with the Sichuan Institute of Chemical
Engineering and Geological Exploration. It has been assumed that the laboratory followed the guidelines
of the National Standard of Peoples Republic of China GB/T 1871.1-1995--Assaying for Phosphorus
Pentoxide in Phosphorus Ore and Phosphorus Ore Concentrate, Phosphomolybdic Acid and Quinoline
Gravimetric Method and Volumetric Method. These guidelines also include standards for the analysis of
iron, aluminum, calcium, and magnesium in phosphorus ore concentrate and phosphorus ore. These
methods must be followed or the laboratory could lose its accreditation.
It is assumed that no core preservation techniques were employed for any of the core (PRC standard
practice) and, as such, future detailed analytical tests of the core will yield results which are not
necessarily representative of the unweathered phosphorite material. The moisture content of the
unweathered phosphorite material is sufciently low so that the core will nominally acquire atmospheric
moisture and accelerate the weathering process on the mineralization exposed by the coring process.
This process affects the chemistry as well as the physical attributes of the cored material.
All phosphorite core and trench samples as appropriate from the various eld programs, were hand-
washed and put into the core box (or bagged in PVC containers) in sequence. All core-log forms were
completed and well kept in the eld, which meets the requirements for assay, photography, and sampling
standards. For drill hole sealing, mortar was prepared by ratio of 1:0.7:2 of 425# cement with water and
ne sands used to place a surface seal in the drill collars. All boreholes were marked with permanent
cement stakes buried at the collar with hole number, date and drilling team marked on the stake.
All original records were completed in accordance with stipulations and PRC standard practices, with
their contents and forms retained to keep an accurate, complete, clear and timely record of events
and results. The drilling-shift records were accepted upon inspection by 3 levels of supervision and
management. Other original records that were completed include procedures for compilation, inspection
and proofreading. The quality of original records is reliable and provides for a precise reliable rsthand
source of basic information for the preparation of the geological report.
Core was taken from the eld operations to the geological team core-storage facilities where it was
further described and processed. Detailed core descriptions were completed and various samples
selected for chemical analysis. The core intervals selected for chemical analysis were split lengthwise by
a core-splitter with one-half being retained for reference and the other half submitted to the laboratory for
evaluation. Samples were dened by lithology and bed identication but never exceeded 2.0 m in length
in the phosphorite bed.
For the samples derived from the several sampling campaigns at both Mines, sample collection was
conducted on the premise of recording detailed records of depth, thickness and core length, along with
statements of the physical properties of the phosphorite bed and overburden material, macrolithotype
and core conditions. The phosphorite bed was wholly sampled as an independent seam. Samples were
weighed on site to ensure their representativeness. Core that was reduced to nes in the drill operation
3
The 21st Laboratory of Chemical Geology and Mine of Sichuan Province has not provided its consent for the purposes of Section
249 of the SFA to the inclusion of its name, its reports and other information extracted from its reports which are referred to here
and in other parts of this Technical Report and therefore is not liable for such information under Sections 253 and 254 of the SFA.
J-41

or contaminated were not sampled. With the intact cylinder core recovered from drilling, intervals with
gangue of 10 mm, or more, were rejected as were intervals of core in very small fragments or powder
form. Collected phosphorite samples were washed and dried, placed into core boxes and then sent to
the 21
st
Laboratory of Chemical Geology and Mine of Sichuan Province for assay using the National
Standard of Peoples Republic of China GB/T 1871.1-1995--Assaying for Phosphorus Pentoxide in
Phosphorus Ore and Phosphorus Ore Concentrate, Phosphomolybdic Acid and Quinoline Gravimetric
Method and Volumetric Method within the set transportation time limit established by Provincial
standards. Collection, packaging and transportation of all types of samples were in accordance with the
Ministerial criteria and the design for detailed survey. In total, over several campaigns, samples from
13 trenches and six drill holes were sent to the Provincial chemical laboratory for analysis. In addition,
21 samples from underground mining locations were sent to the chemical laboratory of the Mianzhu
Norwest in Hanwang Town Mianzhu City for assay using the National Standard of Peoples Republic of
China GB/T 1871.1-1995.
Samples collected for rock strength analysis are sent to one of several laboratories which specialize in
such specic analytical work. Water samples collected for analyses are also sent to laboratories which
specialize in such work.
References to various guidelines for data verication are found throughout this report especially in
Sections 11, 12 and 13. Specic and general criteria and guidelines for conducting eldwork, and data
verication by the Institute, are briey listed below:
Classication on Solid Mineral Resources/Reserves (GB/T17766-1999);
Evaluation Guidelines for Mining Rights (The Amendment Act in 2006);
The No. 18 announcement on implementing The Revised Evaluation Methods for the Assessment
Ways of Mining Revenue issued in 2006 by Ministry of Land and Resources;
Interim Measures for Prospecting and Mining Rights Assessment; and
Evaluation Guidelines for Mining Rights (The Amendment Act in 2006).
For the samples derived from the multiple eld programs at both Mianzhu Norwest Mines, it has been
assumed that the 21
st
Laboratory of Chemical Geology and Mine of Sichuan Province provided the
testing and analytical results according to the protocols set forth in the National Standard of Peoples
Republic of China GB/T 1871.1-1995. As explained in Section 13 of this report there is an intense and
extensive data verication protocol that is dictated by internal, Provincial and National set of standards.
It has been reported that this facility holds both a China Authorization Certicate and a National
Metrology Accreditation Certicate which were in force at the appropriate times.
11.2 Sample Preparation and Assaying
Prior to Mianzhu Norwests establishment of operations in 2002, all sample preparation and all analytical
routines were conducted at the 21
st
Laboratory of Chemical Geology and Mine of Sichuan Province
which was independent of the company. Later sampling in the 2002 to 2008 period was completed
by Mianzhu Norwest with the analysis completed at the chemical laboratory of Mianzhu Norwest in
Hanwang Town Mianzhu City. While all sampling and assaying that was used was not independent of the
company, WGM has relied on its accuracy based on the more than 10 years of successful production
history by Mianzhu Norwest.
All assaying was completed using the National Standard of Peoples Republic of China GB/T
1871.1-1995--Assaying for Phosphorus Pentoxide in Phosphorus Ore and Phosphorus Ore Concentrate,
Phosphomolybdic Acid and Quinoline Gravimetric Method and Volumetric Method with further
implementation of appropriate Provincial and/or current industrial standards for assay procedures.
All tasks of sample collection, packaging and assay determination were under the guidance of the
appropriate Ministerial, Provincial and/or National standards and rules.
J-42

According to Provincial and National guidelines, after typical sample preparation procedures, individual
analytes were quantified using wet chemical methods, atomic absorption and other testing as
required. During the analytical procedures, quality control and quality assurance were checked on a
continuing basis. Internal laboratory checking, which is actually a reanalysis of the individual samples,
was completed on 5% of the samples received. Standard samples (knowns) were inserted into the
set of samples being tested. These standards, inserted about once every day, were used for internal
laboratory procedure control and checking of the analytical accuracy. In addition to checking overall
laboratory performance, about once per year a National Standard is analyzed by all phosphate
laboratories in China and the results compared. Such actions and reforms as necessary are completed
immediately under both Provincial and National supervision. This facility is authorized and certied by
both the National and Provincial governments. All differences accounted for in the QA/QC programs are
rectied either through re-analysis or through mathematical procedures which account for analytical drift.
In general, two types of analyses were prepared from the samples from the deposits:
Basic [Fundamental]; and
Group [Combinatory].
The Group sample analysis reported for this report is assumed to be based on the report by the Coal
Design & Research Institute of Sichuan Province in 2005. However, no analyses have been presented
for review in this Technical report.
In the PRC, it is common to composite various exploration/development samples for group assays.
While this methodology and approach provides some limited information, the approach does not offer
any insights into the vertical variability of the phosphorite bed or the aerial variability of the phosphorite
bed between sampling points. In the exploitation of the phosphorite, particularly on large properties,
the variability of the phosphorite can, and often does, change the performance of the ore in whatever
processing owsheet is used.
Normally, in phosphorite exploration and development work in the western world a number of
constituents are analyzed on each and every sample without physically compositing the material.
Generally these constituents include: P
2
O
5
, CaO, SiO
2
, MgO, Fe
2
O
3,
Al
2
O
3,
and CO
2
(LOI) Fundamental.
Other constituents are often analyzed on composited Combinatory samples either whole-bed analysis
(preferred) or groups of holes. Those constituents can include, but are not limited to: Na
2
O, K
2
O, SO
3
-
,
C, F, Cl
-
, Cd, As, Hg, Se, etc. Each of these analytes plays a role in evaluating the success of a process
owsheet and/or determination of harmful constituents in various waste streams from the process or in
the nal product being produced.
For the Shi Sun Xi drill holes only the basic analysis group was run on each sample and consists of
results for only P
2
O
5
, acid insolubles (H.P.) and SiO
2
. With regard to all of the trench samples from
both properties, only the P
2
O
5
analyses have been presented for review. The analyses for the samples
collected underground on both properties, only P
2
O
5
and Fe
2
O
3
were completed by Mianzhu Norwest. The
same analytical standards and methods were applied as used for the trench and drill hole samples.
Phosphorite bed densities were determined using the displacement method on selected samples. These
individual densities were then weight averaged for the property. A single average density was used for
the bed on each property to determine the contained tonnage. A total of 28 samples collected in 1997
were used at Cheng Qiang Yan and a total of 16 samples from Shi Sun Xi were used for that property.
The use of an averaged density for resource calculations is not unwarranted in this type of geologic
environment although some actual minor variations must be expected due to the differing contributions of
the individual phosphate layers at different locations. Approximately the same density is used for both of
Mianzhu Norwests Mines: 3.08 t/m
3
at Cheng Qiang Yan and 3.03 t/m
3
at Shi Sun Xi.
J-43

Several groups (sets; phosphorite roof and floor) of rock samples were collected from both the
trenches and drill holes to examine the rock mechanics of the rock strata which form the roof and oor
of phosphorite bed. In addition, several tests were completed on the phosphorite material itself. As
appropriate, samples were marked with the orientation of top and bottom, the block number, the
specications and sampling depth. The individual samples were then packed in wax paper and kraft
paper, wax sealed and sent to the lab in a timely fashion.
The phosphorite and rock samples are not considered high value assets and as such do not require the
extra precautions of physical security that other more valuable minerals might require. However, the QA/
QC procedures implemented by the laboratories do provide security for the accuracy of the analyses
and the results which are reported. The following are a few of the steps employed by the QA/QC system:
Every sample is analyzed in duplicate and retests are completed by two technicians in parallel;
The results of the analyses are rechecked by the assayer, by the group leader and nally by the
technician-in-charge for a total of three checks;
For results in dispute, the re-analysis must be conducted simultaneously with a standard to verify
accuracy;
Standard samples are all certied as are the sub-level standards;
Implementation of assay results verication is organized by the person in charge of techniques at
the lab and in accordance with existing protocols and appropriate standards;
Duplicate assays are by the same or different analytical methods as required; and
The person in charge (see above) is to complete a statistical analysis of the verication data to
discover trends and to appraise the results with statistical measures.
J-44

12. DATA VERIFICATION
WGM as part of this Technical Report has completed four site visits to both surface and underground
facilities at Cheng Qiang Yan. Access to Shi Sun Xi was not possible in 2010 due to blockage of the
access road but access to the new underground development adit was made in November 2011 and May
2012. In 2010, WGM also interviewed personnel of the Sichuan Institute of Chemical Engineering and
Geological Exploration. WGM also inspected about 5% of the production quality control laboratory sheets
and such les as were available that included all aspects of the data collected from the drill holes and
trenches as well as individual interpretations resulting from those data.

In preparation of this report, the qualied persons have taken into account all relevant information
supplied by the directors of the listing applicant.
In 2010 extensive interviews were conducted with the personnel of Mianzhu Norwest Interviews were
primarily focused on data handling procedures, data storage and data transfer among other items of
importance. WGM was satised with its review of available technical information and so no reason for the
collection of independent verication samples.
Normally, the eld work conducted by the Institutes, both the Sichuan Institute of Chemical Engineering
and Geological Exploration and the Coal Design & Research Institute of Sichuan Province, has many
internal and external checks for data verication for each task being performed and protocols in place
for rectifying any discrepancies. The same is true for the laboratory procedures employed by the 21
st

Laboratory of Chemical Geology and Mine of Sichuan Province. Interviews were limited in time and
scope at the Sichuan Institute of Chemical Engineering and Geological Exploration because appropriate
personnel and les were not available. However WGM was satised that the information reviewed and
presented reasonably reects what was presented and observed.
WGM also notes, that verication of the west borderline of the Shi Sun Xis mining license was in dispute
until August 2005 due to an overlapping of the west boundary line of the Shi Sun Xi Phosphorite Mine
and east boundary line of the Long Lin Phosphorite Mine. The resolution, in summary, moved the west
boundary line of the Shi Sun Xi Phosphorite Mine, in parallel, 60 m towards the east. However, in the
report Additional Exploration of Geological Report for Sichuan Mianzhu Norwest Phosphate Chemical
Company Ltd (Shi Sun Xi Phosphorite Mine) submitted by Sichuan Institute of Chemical Engineering and
Geological Exploration in October, 2005, the phosphorite reserves that were reported were still based on
the previous boundary line denition.
The report entitled Additional exploration of geological report for Sichuan Mianzhu Norwest Phosphate
Chemical Company Ltd (Shi Sun Xi Phosphorite Mine) was submitted by Sichuan Institute of Chemical
Engineering and Geological Exploration in October, 2005 which contained a reserves summary
(resources) developed using PRC standards of classication. The reference above indicates an incorrect
western boundary line was used in this estimation.
J-45

13. MINERAL PROCESSING AND METALLURGICAL TESTING
For this review and report, no direct evidence of previous mineral processing and/or metallurgical testing
has been presented for inclusion. In a report (1998) on the Cheng Qiang Yan property, the Sichuan
Institute of Chemical Engineering and Geological Exploration indicated that little or no testing had been
completed in the preparation of their report. The report stated that, for the Cheng Qiang Yan property,
the mineral type is called Shi Fang Type, which has been discovered and processed for over 40 years.
The processing industry has considerable processing experience on handling this type of mineralization,
and based on these experiences, the product from this site can be directly used as chemical reagents or
fertilizer.
A similar reference to metallurgical testing was found in the data (Coal Design & Research Institute of
Sichuan Province2006) presented for the review of the Shi Sun Xi property. The phosphorite mine is
of the Shi Fang Type (the ore in the mine belongs to Shi Fang Type phosphorite mine) and has claimed
over 40 years history from prospecting to exploitation and has accomplished a lot of research and testing
work on mineral processing and utilization. Based on the current situation that the phosphate fertilizer
plants and yellow phosphorus plants both in and out of the province make direct use of the phosphate
rock, the phosphate rock in this mine is similar to other ore types, which can be directly used in fertilizer
or in chemical engineering material processing.
As stated in the direct quotation above, no direct evidence of testing or testing results was made available
for review for this Technical report.
The mining operations at Cheng Qiang Yan, under the administration of Mianzhu Norwest, produced,
from 2002 until the Wenchuan Earthquake, a total of approximately 379,000 tonnes of phosphate rock
that were fed to the electric furnace operations at Hanwang Town Mianzhu City to produce elemental
phosphorus (P
4
). After access to Cheng Qiang Yan was re-established in 2010 the mine produced 30,000
tonnes in the period after the major rockslide in 2010 and 2011. This operating history demonstrates
that end products (P
4
. and related) can be produced economically and competitively with this type of
operation. For this current study, the production records that survived the Wenchuan Earthquake were
reviewed. The records constitute coverage of about 80% of the approximately 183,000 tonnes produced,
from mining operations at Cheng Qiang Yan, between 2006 and the Wenchuan Earthquake. This
surveyed tonnage averaged about 29.6% P
2
O
5
and 2.9% Fe
2
O
3
(dry). No other analytes were tracked
through these quality control measures. The average size of each of these quality control samples
represented about 148 tonnes of mine production. The average moisture content of each of these
samples was about 4.6% H
2
O. The production of P
4
, from this tonnage should be considered a successful
metallurgical demonstration for this processing option.
One analyte mentioned during on-site discussions was arsenic (As). No measurements of this analyte
were made during exploration and development sampling at either Cheng Qiang Yan or Shi Sun Xi. No
measurements of arsenic are made on the mining production samples submitted for analysis from Cheng
Qiang Yan. However, periodic measurements are taken as part of the P
4
process control sampling.
The arsenic values verbally reported by Mianzhu Norwest management were between 60 and 70 ppm.
Since the arsenic typically increases approximately 10fold during the P
4
production process, this implies
that the value in the phosphate rock is about 6 to 7 ppm. There was no evidence that this element had
been tracked in the operation from the phosphate rock, waste products and possible releases to the
environment which would be normal and required practice in western operations.
J-46

14. MINERAL RESOURCE ESTIMATES
14.1 GENERAL
In keeping with the practice of USGS Bulletin 1450-B, Bulletin 831 and Bulletin 891, for these types
of mineral deposits and by NI 43-101 and JORC standards, WGM has applied the following Mineral
Resource/Reserve denitions for this Technical Report.
Mineral Resources
All phosphate bearing material with a P
2
O
5
content greater than 8% and a thickness greater than 25
cm are considered. Primary focus is concerned with phosphorite bed D
3
S
1
on both Mianzhu Norwests
properties. For the two deposits, no outcrop barriers, no boundary buffers, no buffers along faults,
no areas of past minor production, and no areas of low-quality or thin material were omitted from the
Resource estimates.
Mineral Reserves
No reserves were estimated due to the lack of supporting studies which would allow the use of that
category. Certainly some reserves exist due to past production from the Cheng Qiang Yan deposit and
that production would qualify a minor portion of the Resource as Reserves but further work is required for
denition.
Within each of the denitions presented above, there are three categories, or levels of denition, which
depend upon the density of sampling points used to examine the property and quantify the tonnage.
These categories are, in decreasing sample-point density (increased sample spacing).
Measured Resources
For the Cheng Qiang Yan deposit, where continuity has been established, those tonnes found within
400 m of a sampling point whether it is a drill hole or a trench is categorized as Measured. The 400 m
radius provides a maximum area around each sample point of 50.92 hectares. For the Shi Sun Xi
deposit, where the continuity is much less well established, the radius was set at 200 m which provides
a maximum area around each sample point of 12.57 hectares that contain tonnes of this category. This
conservative approach to the Shi Sun Xi deposits does not alter the total tonnage of the deposit but
reduces the Resource tonnage considered Measured on a partially explored/dened and geologically
complex property. The denition used as a basis for the above species that the true extent of the
phosphate has been sufciently measured so that the tonnage is judged to be accurate within 20% of the
true tonnage.
Indicated Resources
These tonnages are computed partly from specied measurements and partly from projection of data to
a reasonable distance. The recommended maximum projection distance is 800 m for Cheng Qiang Yan
deposit and 500 m for the less well dened, and more geologically complex, Shi Sun Xi deposit. Thus, for
the Cheng Qiang Yan deposit, the Indicated tonnages fall into a belt that is from 400 m to 800 m around a
sampling point. For the Shi Sun Xi deposit, this belt is from 200 m to 500 m around a sampling point.
Inferred Resources
The classication of these tonnages is based largely on broad knowledge of the geologic character of
the deposit (bed) and where few measurements are available. The estimates are based primarily on
assumed continuation of Indicated areas from which there is geologic evidence. In the case of the Cheng
Qiang Yan deposit, most of the estimated Inferred tonnage is located to the west of fault F205 where no
data are available for review. A minor portion of the Inferred tonnage is located beyond the 800 m radius
which denes the Indicated tonnage. At Shi Sun Xi, the Inferred tonnage is beyond the 500 m radius that
denes the Indicated tonnage.
J-47

The estimated Resources for the two properties are further divided based on the ramications of
restrictions contained within the mining and exploration licenses of each. As stated elsewhere in this
Technical Report, the mining license for the Cheng Qiang Yan deposit restricts control of the resource to
elevations between 2,570 and 2,240 m. The mining license for the Shi Sun Xi deposit restricts control
to elevations between 2420 and 1,600 m. The exploration license for Cheng Qiang Yan contains no
restrictions based on elevations of the phosphorite bed. The same is true for the Shi Sun Xi exploration
license.
14.2 DEFINITIONS
The classication of Mineral Resources and Mineral Reserves used in this report conforms with the
denitions of the Canadian Institute of Mining Metallurgy and Petroleum (CIM) Council adopted on
November 27, 2010. We have followed the guidelines and standards provided in the nal version of
National Instrument 43-101 (NI 43-101), which rst came into effect on February 1, 2001, was revised
on December 11, 2005, and further changed effective June 30, 2011. We further conrm that, in arriving
at our classication, we have followed the relevant denitions for the CIM Standards/NI 43-101, as follows:
A Mineral Resource is a concentration or occurrence of diamonds, natural solid inorganic,
or natural solid fossilized organic material including base and precious metals, coal, and
industrial minerals in or on the Earths crust in such form and quantity and of such a grade
or quality that it has reasonable prospects for economic extraction. The location, quantity,
grade, geological characteristics and continuity of a Mineral Resource are known, estimated
or interpreted from specic geological evidence and knowledge.
An Inferred Mineral Resource is that part of a Mineral Resource

for which quantity and
grade or quality can be estimated on the basis of geological evidence and limited sampling
and reasonably assumed, but not veried, geological and grade continuity. The estimate is
based on limited information and sampling gathered through appropriate techniques from
locations such as outcrops, trenches, pits, workings and drill holes.
An Indicated Mineral Resource is that part of a Mineral Resource

for which quantity,
grade or quality, densities, shape and physical characteristics, can be estimated with a
level of condence sufcient to allow the appropriate application of technical and economic
parameters, to support mine planning and evaluation of the economic viability of the deposit.
The estimate is based on detailed and reliable exploration and testing information gathered
through appropriate techniques from locations such as outcrops, trenches, pits, workings
and drill holes that are spaced closely enough for geological and grade continuity to be
reasonably assumed.
A Measured Mineral Resource is that part of a Mineral Resource

for which quantity, grade
or quality, densities, shape, and physical characteristics are so well established that they
can be estimated with condence sufcient to allow the appropriate application of technical
and economic parameters, to support production planning and evaluation of the economic
viability of the deposit. The estimate is based on detailed and reliable exploration, sampling
and testing information gathered through appropriate techniques from locations such as
outcrops, trenches, pits, workings and drill holes that are spaced closely enough to conrm
both geological and grade continuity.
A Mineral Reserve is the economically mineable part of a Measured or Indicated Mineral
Resource demonstrated by at least a Preliminary Feasibility Study. This Study must include
adequate information on mining, processing, metallurgical, economic and other relevant
factors that demonstrate, at the time of reporting, that economic extraction can be justied. A
Mineral Reserve includes diluting materials and allowances for losses that may occur when
the material is mined.
J-48

A Probable Mineral Reserve is the economically mineable part of an Indicated and, in
some circumstances, a Measured Mineral Resource demonstrated by at least a Preliminary
Feasibility Study. This Study must include adequate information on mining, processing,
metallurgical, economic, and other relevant factors that demonstrate, at the time of reporting,
that economic extraction can be justied.
A Proven Mineral Reserve is the economically mineable part of a Measured Mineral
Resource demonstrated by at least a Preliminary Feasibility Study. This Study must include
adequate information on mining, processing, metallurgical, economic, and other relevant
factors that demonstrate, at the time of reporting, that economic extraction is justied.
14.3 PHOSPHORITE RESOURCE ESTIMATE BY WGM
The Mineral Resource estimates prepared for each of Mianzhu Norwests Mines used the data from each
of the properties presented for review. WGM cross checked, and veried data from all known sources
available. A portion of the data was lost in the destruction caused by the Wenchuan Earthquake and
other data was lost in the archives of the institution that performed most of the eld programs and wrote
past reports for the two properties. These missing data were not included in the Resource estimate.
The estimation of the Resources used routines from Gemcom Softwares GEMS 6.2.3 software and are
described in Section 14.3.
Other computer model design criteria are as follow:
Phosphorite Density A constant 3.08 tonnes per cubic metre was used for Cheng Qiang Yan
and 3.03 tonnes per cubic metre used for Shi Sun Xi; these are the same as for all past studies
conducted and are supported by reports and samples;
Minimum Phosphorite Bed Thickness 0.25 m; estimates by past PRC work use a minimum
thickness of 1.6 m; (Thicknesses ranged from 1.08 m to 13.84 m);
Phosphorite Subcrops None were used. The geological history for the Shi Fang type deposit
dictates that all weathering phenomena were emplaced millions of years ago and no recent activity
accounts for changes;
Phosphorite Analyses The data which are contained in individual sample analyses contained
in the dataset for each property are limited. The past PRC estimates used various grade cut offs
at various times all dictated by Provincial guidelines although; such cut offs are not geologically
warranted. An 8% P
2
O
5
cut off basis was applied by WGM, (polygon grades ranged from, 17.77%
-34.38%) ; and,
Outside Estimate Boundary The mining license boundary and the exploration license boundary
are used for each property.
Table 4 presents the M&I Mineral Resource estimate for each property as prepared by WGM for Mianzhu
Norwests license holdings. Average bed thickness and average P
2
O
5
content are weight averaged by
tonnes from the various applicable polygons resulting from the estimating process (Figure 3 and 9).
Table 5 presents the estimated Inferred Resources for each property as prepared by WGM for Mianzhu
Norwests license holdings. Average bed thickness and average P
2
O
5
content are weight averaged by
tonnes from the various applicable polygons resulting from the estimating process (Figure 4 and 10).
Details of the resource estimation for each zone are tabulated in Appendix 2.
Under both NI 43-101 and JORC criteria, only Resources under the M&I classication may be considered
for inclusion into any mine planning efforts which are required to possibly elevate the categorization of
that material to Reserve status. The demonstration of economic viability of the tonnage and processes
must be established before the category of reserves is used. No Inferred Resources may be included in
these efforts.
J-49

TABLE 4.
TOTAL ESTIMATED M&I PHOSPHORITE RESOURCES* FOR MIANZHU NORWEST
Tonnes
(million)
Bed Thk
(m)
P
2
O
5
(%)
Mining License Area
Cheng Qiang Yan
M & I Resource Measured 3.0 5.33 28.61
Total 3.0 5.33 28.61
Shi Sun Xi
Indicated 10.7 7.05 29.77
Total 17.6 6.96 29.57
Total
Indicated 10.7 7.05 29.77
Total 20.6 6.72 29.43
Exploration License Area
Cheng Qiang Yan
Total 0.3 2.91 29.44
Shi Sun Xi
Indicated 1.3 6.18 26.71
Total 1.3 6.07 26.55
Total
Indicated 1.3 6.18 26.71
Total 1.6 5.58 26.99
TABLE 5.
ESTIMATED INFERRED** PHOSPHORITE RESOURCES FOR MIANZHU NORWEST
Tonnes
(million)
Bed Thk
(m)
P
2
O
5
(%)
Mining License Area
Cheng Qiang Yan Inferred 0.9 3.86 26.77
Shi Sun Xi Inferred 1.8 6.79 30.02
Total 2.7 5.79 28.91
Exploration License Area
Cheng Qiang Yan Inferred
Shi Sun Xi Inferred 16.1 8.07 29.74
Total 16.1 8.07 29.74
J-50

Figure 3 Cheng Qiang Yan (Mine 1) land status map
0 100 500
Metres
ASI APHOS PRI VATE LI MI TED
Cheng Qiang Yan (Mine 1)
Phosphate Project
Sichuan Province, P.R. China
Scale 1 : 10,000
Figure 3.
Graphics by Watts, Griffis and McOuat Limited
Legend:
Exploration Rights
Trench
Fault
Mining Right
N
After Chemical Geological Exploration Institute of Sichuan Province
Land Status Map
35,404,500
3
,
4
9
8
,
5
0
0
35,405,500
35,404,500
3
,
4
9
7
,
5
0
0
3
,
4
9
8
,
5
0
0
3
,
4
9
7
,
5
0
0
Bedding
Phosphate outcrop
J-51

Figure 4. Shi Sun Xi (Mine 2) land status map
125 625
Metres
Shi Sun Xi (Mine 2)
Phosphate Project
Scale 1 : 12,500
Figure 4.
Graphics by Watts, Griffis and McOuat Limited
After Chemical Geological Exploration Institute of Sichuan Province
Land Status Map
35,413,000 35,414,000
3
,
5
0
1
,
0
0
0
3
,
5
0
2
,
0
0
0
3
,
5
0
3
,
0
0
0
3
,
5
0
2
,
0
0
0
3
,
5
0
3
,
0
0
0
35,413,000
Legend:
Exploration Rights
Trench
Fault
Mining Right
Phosphate outcrop
Drill hole location
J-52

TABLE 6.
SUMMARY OF THE MINERAL RESOURCES FOR MIANZHU NORWEST MINES
Category Mineral
Type
Gross Attributable to
licence
Assumed at 100%
Remarks
Tonnes
(millions)
Grade
(P
2
O
5
%)
Tonnes
(millions)
Grade
(P
2
O
5
%)
Change
from previous
update (%)
to determine
Proved
Probable
Total
Resources*
Indicated Phosphorite 12.0 29.43 12.0 29.43
Total 22.2** 29.25** 22.2** 29.25**
This document is the reporting of phosphorite Resources only. No associated mining, metallurgical,
economic, marketing or environmental studies have been referenced in the preparation of these
Resources. The conversion of the phosphorite Resource to Reserves will require closer spaced drilling
and sampling to more accurately dene the deposit boundaries and thicknesses as well as the grades.
This conversion must be supported by the application of economic factors and mining factors to dene
the cut off grade for the portion of phosphorite Resource that is economic and can be classied as
reserves. The Mianzhu Norwest mining operation currently operates with very localized knowledge of
grade and thickness based on progressing from the active mining areas. This operating practice can
be exposed to changes in grade or production due to geologic factors that may change as the mining
is advanced putting production plans at risk. Based on the history to date of the Mianzhu Norwest
operations, WGM believes that completion of the necessary drilling and sampling will be successful in
conversion of a high proportion of the Resource being classied as reserves after application of the
modifying factors.
Although the WGM Resource estimates are based on one continuous mineralized zone across the
licensed areas, it is possible that more complete knowledge of the phosphorite bed thickness and local
structure could result in increased Resources to those currently estimated.
Further development efforts which may include underground development to allow drilling and sampling,
are required to elevate the Inferred Resources, or any portion thereof, to the Measured and Indicated
categories. This work may take place any time in the future as dictated by Mianzhu Norwests long-term
business planning.
14.4 CHENG QIANG YAN AND SHI SUN XI RESOURCE ESTIMATION METHODOLOGY
For estimating the phosphorite Resources on Mianzhu Norwests Mines, WGM utilized the software
routines contained within the GEMS module (version 6.2.3) distributed and maintained by Gemcom
Software, International Inc. GEMS, permits the management of drill hole data and other measurement
information to create plots, maps, model surfaces and solids, and employ sophisticated geostatistics to
quantify, visualize and analyze mineral deposits. It places data points into a transformed space in which
the correct spatial relationship is maintained for analysis and interpolation purposes. It then transforms
the estimates back into their original space.
J-53

For each of the two Mianzhu Norwest Mines, WGM followed a stepwise progression through the GEMS
software to manage the data, and the project, while developing a computer model for both Cheng Qiang
Yan and Shi Sun Xi. The models are a 3D representation of the geology for each site and the interactions
of the geology with the mining and exploration licenses. The steps followed, in general, the grouping of
activities outlined below:
Project Setup
Project setup with data workspaces for the following data elements:
Polylines (for topography contours, license boundaries, faults, surface outcrops);
Polygons (for polygonal estimates);
Wireframes (for faults, topography, mining and exploration license boundaries); and
Point Areas (for surface trench, drill hole, and underground channel samples).
Data Import and Validation
Topography contours (digitized from supplied drawings) imported into Polyline workspace;
Trench locations and drill hole intercepts imported as points into Point Area workspace; and
Fault lines, surface outcrops and license boundaries imported to Polyline workspace.
Wire-framing
Solids generated from license boundaries mine licenses extended to vertical limits as dened.
Exploration licenses extended in vertical to deepest extent of seam;
Topography surface generated from digitized topography contours; and
Fault lines projected from surface downwards according to strike and dip and fault. Fault surface
generated from two lines. In the case of Shi Sun Xi, no attitude data was available for fault F14, so
was assumed to be vertical fault.
Inclined Plane Generation
Fault lines and surface outcrops projected to 3D topography surface; and
Best-t inclined plane generated from surface outcrop lines, trench locations, underground channel
samples, and drill hole locations.
Geostatistics
Variograms were generated for each deposit to determine if grade distribution trends exist. Currently
there are insufcient data to produce meaningful conclusions about sample dependence at either deposit.
Consequently, general rules of sample dependence, based on the aforementioned U.S.G.S. Bulletins and
years of world-wide experience with sedimentary phosphorite deposits, were used. Basic statistics run on
sample population and the sample frequency distribution curves are presented in Figures 5 and 6.
Polygonal Modelling
License-boundary polygons were generated by intersecting license boundary wireframes with
inclined planes. Mine license boundaries were clipped at surface, and below the lowest allowable
elevation as follows:
Cheng Qiang Yan: maximum depth 2,240 m
Shi Sun Xi: maximum depth 1,600 m
J-54

Grade polygons were generated from trench samples, underground channel samples and drill
hole intercepts, and projected to inclined plane. Polygons for Measured, Indicated and Inferred
categories generated as per the following polygon radii of inuence:
Measured Indicated Inferred
Cheng Qiang Yan 400 m 400 m to 800 m >800 m
Shi Sun Xi 200 m 200 m to 500 m >500 m
Final resource polygons were generated by clipping grade polygons against the license boundaries.
Figure 5. Cheng Qiang Yan Frequency Distribution Curve
Figure 6. Shi Sun Xi Frequency Distribution Curve
J-55

Density
As previously described, the bulk density for each deposit was determined by the Geological Institute
based on at least 16 sample measurements per property.
Constant densities for all rock were coded as follows:
Cheng Qiang Yan: 3.08 tonne/m
3
Shi Sun Xi: 3.03 tonne/m
3
Mineral Resource Estimate Summary
The phosphorite Resource estimates for the Cheng Qiang Yan and Shi Sun Xi deposits are presented, in
various formats, on Tables in Section 1, Tables 2 and 3 (Section 14) and Tables 7 and 8 (Section 25) of
this Technical Report.
For presentation of the computer models and their results, a series of six gures have been prepared for
inspection. These gures, with brief explanations, are:
Figure 7 Cheng Qiang Yan -- Perspective View; this Figure presents a 3D perspective view of the
topography, sampling points and license boundaries for the Cheng Qiang Yan deposit;
Figure 8 Shi Sun Xi -- Perspective View; this Figure presents a 3D perspective view of the
topography, sampling points and license boundaries for the Shi Sun Xi deposit. The view is to the
NE showing the outcrop, the dip of the phosphorite bed, the sample locations and the radii used for
determining the Resource classications;
Figure 9 Cheng Qiang Yan -- Resource Polygons; This view to the east shows the phosphorite bed
outcrop, the trenches and other sample locations as well as the mining and exploration license
boundaries. It also shows the Resource polygons which have been truncated at the phosphorite
bed outcrop. Note that many of the sample locations are outside the mining license boundary as
these samples were taken from operations involved with gaining access to the licensed area. Using
this Figure, what is shown on Figure 7 may become more clear; and
Figure 10 Shi Sun Xi -- Resource Polygons; This Figure, with South to the top of the page shows
the Resource polygons which have been truncated at the boundaries of the mining and exploration
licenses. The phosphorite bed outcrop is toward the top of the Figure.
No compliant Reserve estimates have been completed. Therefore sections 15-22 of the NI 43-101 report
are not required. However as some of the information for various aspects of Mining Methods, Recovery
Methods, Project Infrastructure, Environmental Studies, Permits, and Social or Community Impact, Capital
and Operating Costs and Economic Analyses are available, such information has been summarized in
Section 24.
J-56

Figure 7. Cheng Qiang Yan -- perspective view
Elev (Z)
st (X)
North (Y)
Legend:
*UDSKLFVE\:DWWV*ULIILVDQG0F2XDW/LPLWHG
N
0easurea 5esource 3ol\Jons
Inaicatea 5esource 3ol\Jons
InIerrea 5esource 3ol\Jons
SamSle /ocations
ToSoJraSh\ Elevation Contours
Figure 7.
$6,$3+2635,9$7(/,0,7('
Phosphate Project
Sichuan 3rovince, 3.5. China
&KHQJ4LDQJ<DQ'3HUVSHFWLYH9LHZ
3
5
4
0
4
0
0
0

X
3
5
4
0
5
0
0
0

X
3
5
4
0
6
0
0
0

X
3
5
4
0
7
0
0
0

X
3497000 Y
3498000 Y
3499000 Y
N
*
J-57

Figure 8. Shi Sun Xi -- perspective view
East (X)
(Y)
Elev (Z)
Legend:
*UDSKLFVE\:DWWV*ULIILVDQG0F2XDW/LPLWHG
N
0easurea 5esource 3ol\Jons
Inaicatea 5esource 3ol\Jons
InIerrea 5esource 3ol\Jons
SamSle /ocations
ToSoJraSh\ Elevation Contours
Figure 8.
$6,$3+2635,9$7(/,0,7('
Phosphate Project
Sichuan 3rovince, 3.5. China
6KL6XQ;L'3HUVSHFWLYH9LHZ
3
5
4
1
1
0
0
0

X
3
5
4
1
2
0
0
0

X
3
5
4
1
3
0
0
0

X
3
5
4
1
4
0
0
0

X
3501000 Y
3502000 Y
3503000 Y
N
*
J-58

Figure 9. Cheng Qiang Yan -- Resource polygons
5Y4
TC103
5Y1
TC102
5Y2
15OP1
9OP1
15OP4
5Y3
9OP2
15OP3
15OP2
3OP1
4OP1
3OP3
TC101
3OP2
TC104
8Y3
4OP2
8Y2
TC105
8OP1
4OP3
TC106
-250 0 250 500
Scale 1:20000
-
2
0
0
0

X
-
1
7
5
0

X
-
1
5
0
0

X
-
1
2
5
0

X
-
1
0
0
0

X
-
7
5
0

X
-
5
0
0

X
-
2
5
0

X
0

X
2
5
0

X
5
0
0

X
7
5
0

X
1
0
0
0

X
1
2
5
0

X
1
5
0
0

X -2750 Y
-2500 Y
-2250 Y
-2000 Y
-1750 Y
-1500 Y
-1250 Y
-1000 Y
-750 Y
-500 Y
-250 Y
0 Y
250 Y
500 Y
750 Y
1000 Y
1250 Y
1500 Y
1750 Y
Legend:
Graphics by: Watts, Grifs and McOuat Limited
N
Mining Permit Boundary
Measured Resource Polygons
Indicated Resource Polygons
Inferred Resource Polygons
Sample Locations
Exploration Permit Boundary
Topography Intersection
2240m Elevation Intersection
Figure 9.
Phosphate Proj ect
Cheng Qiang Yan - Resource Polygons
*
a
b
c
a
a
c
NMA REV / Fig 09 Mine 1 Resource Polygons - 8x11 Portait_19J uly2013r.cdr
Last revision date: Thursday 22 August 2013
J-59

Figure 10. Shi Sun Xi -- Resource polygons
ZK705
ZK1001
TC126
ZK903
TC125
TC123
TC124
ZK902
L1950
TC205
ZK703
ZK701
L2050
-250 0 250 500
Scale 1:20000
-
1
0
0
0

X
-
7
5
0

X
-
5
0
0

X
-
2
5
0

X
0

X
2
5
0

X
5
0
0

X
7
5
0

X
1
0
0
0

X
1
2
5
0

X
1
5
0
0

X
1
7
5
0

X
2
0
0
0

X
2
2
5
0

X
-3250 Y
-3000 Y
-2750 Y
-2500 Y
-2250 Y
-2000 Y
-1750 Y
-1500 Y
-1250 Y
-1000 Y
-750 Y
-500 Y
-250 Y
0 Y
250 Y
500 Y
750 Y
1000 Y
1250 Y
1500 Y
Figure 10.
Phosphate Proj ect
Shi Sun Xi - Resource Polygons
Legend:
Graphics by: Watts, Grifs and McOuat Limited
N
Mining Permit Boundary
Measured Resource Polygons
Indicated Resource Polygons
Inferred Resource Polygons
Sample Locations
Exploration Permit Boundary
Topography Intersection
1600m Elevation Intersection
*
a
b
c
c
c
c
c
c
c
c
b
b
b
b
b
b
b
a
a
a
a
a
a
a
a
b
b
NMA REV / Fig 10 Mine 2 Resource Polygons - 8x11 Portait.cdr
Last revision date: Thursday 22 August 2013
J-60

15. ADJACENT PROPERTIES
The Mianzhu Norwest Mines, Cheng Qiang Yan and Shi Sun Xi, are both located in an historic
phosphorite mining area that was active until the Wenchuan Earthquake. Cooperation between the
neighbouring companies and Mianzhu Norwest was taking place with provision of access during
operations and continues to be good cooperation during post-earthquake restoration activities. The
recent cooperative efforts include the cost sharing of restoring access to all properties in the appropriate
and adjacent water-sheds which provide the main routes of access to the Mianzhu Norwest properties as
well as others in the area.
During the 2010 site-visit interviews with Sichuan Institute of Chemical Engineering and Geological
Exploration, WGMs personnel were not permitted to know the names of the neighbours or the status of
any applications for mining license, or exploration license, renewals or extensions as is the practice of the
PRC.
Using other sources of information, WGM has determined that the adjacent neighbours at Cheng Qiang
Yan are Lomon Phosphate Company to the north and Qing Ping Phosphate Mining Company to the east
of the current mining license area. Likewise, at Shi Sun Xi the adjacent neighbours are the Deyang
Long Lin Mining Company to the west and An Xian Shi Sun Xi Mining Company to the east.
Since the Wenchuan Earthquake and the Landslide, the efforts by all adjacent enterprises are focused
on re-establishing access to each of the two Mianzhu Norwest areas. This access was restored to a
very rudimentary state in 2010 but haulage was again interrupted by a major landslide down the valley
later in the year. When access was re-established, each of the companies began restoration of the
surface facilities destroyed by the Wenchuan Earthquake. Underground visits to both Cheng Qiang Yan
and Shi Sun Xi showed that the underground workings are stable and have maintained excellent ground
conditions both during and after the Wenchuan Earthquake. Adjacent operations to Mines had restored
production at the time of the site visit in November 2011.
J-61

16. OTHER RELEVANT DATA AND INFORMATION
Since the Wenchuan Earthquake, Mianzhu Norwest has been working to restore production of their two
mining operations and the processing facilities. In addition to the earthquake damage to the two mines
and the four phosphate furnaces and support facilities in Mianzhu City, the haulage road between the
mines and the plant was extensively damaged initially in 2008 and again in 2010 by the Landslide
causing extensive delays to Mianzhu Norwests production restoration plans. In 2010 the decision was
made to relocate the process plant from the Hanwang Town site to the Gongxing Town which included the
construction of two new 10,000 tpa furnaces and the support infrastructure.
At the time of the WGMs third site visit in May 2012, Mianzhu Norwest had restored production capability
on two levels at Cheng Qiang Yan and was starting production from one level at Shi Sun Xi.Two additional
levels from Cheng Qiang Yan and one more level from Shi Sun Xi were brought into production later in
2012. The co-operation agreement with a neighbouring mine allows the use of certain mine access drifts,
one at Cheng Qiang Yan and two at Shi Sun Xi. These new accesses will provide for extra production
levels in the future, as well as rehabilitation and development work, including installation of better
infrastructure and ground supports.
Major reconstruction work on the haulage road from Hanwang Town to Qing Ping Town has been
completed. The road was paved and widened to two lanes throughout most of the distance, and single
lane travel restricted only at certain narrower corners. A tunnel in this section equipped with lighting and
ventilation has been completed to bypass a narrow and hazardous road section. A major water diversion
and ood control structure at the side of the highway is also still under construction. Many slope stability
installations, such as bolting of screen mesh, and planting of vegetation, had been completed to reduce
the risk of further rock slides. The river channel was also cleared throughout this section. With the
completion of the majority of the highway from Hanwang Town to Qing Ping Town, the travel time has
been greatly reduced.
The conditions on the section north of Qing Ping Town, which leads to the Mines were also being
improved with plans to construct a series of tunnels and bridges included in a revised budget of a
$3.39 MRMB. The construction of the north section is planned to be completed in 2015. In mid 2013
stockpiling of aggregate was underway and excavation of three tunnels of the seven tunnels planned was
started along with some of the planned bridge construction. The last 3 km to access the Mines is under
upgrade and maintenance by the three companies operating the mines in the area. The northern section
of the road currently requires major work to establish a safe and reliable haulage route to sustain the
Mianzhu Norwest mine production as well as that of two other mine operations in the area and will be a
critical factor until the construction is complete in 2015.
The construction and commissioning of the Plant is nearing completion. The two stage rock crushers
have been installed with conveyor belts to the mine rock stock pile in the courtyard. Construction
of the main structures, such as the furnaces, silos and material storage areas was completed by mid
2013. Commissioning of the furnace operation is currently in progress. The new processing location
also includes an adjacent area for the production of the food processing chemicals, SHMP and STPP.
Relocation of the STPP plant and the related storage and handling facilities to the new location
immediately west of the new furnace site was completed. It is planned to have further enhancements
to the STPP plant at the new site but the main construction work has been delayed until after the
completion of the public listing.
Based on the progress on the restoration of the mines, the Plant construction and the ongoing restoration
of the haulage road, Mianzhu Norwest made a production forecast for their operations starting in 2012 of
40,000 tonnes and gradually building to 415,000 tonnes in 2015 when the reconstruction of the northern
section of the mine haulage road is scheduled for completion.
J-62

16.1 Future Production Planning
As at 31 December 2012, Mianzhu Norwest has produced approximately 94,000 tonnes of rock since
the Wenchuan Earthquake. With the scheduled start-up of the 20,000 tpa Plant expected in the second
quarter of 2013, a revised production schedule has been forecast for the mining operations. It is
planned to mine 121,400 tonnes in 2013 with expansion of the mine production forecast for 2014 and
2015 to annual levels of 264,400 tonnes and 415,000 tonnes, respectively. Mine production in excess
of the required capacity of the Mianzhu Norwest Plant will be sold to other phosphate rock processors
in the region. The highest quality rock that is mined will be utilized to meet the capacity of the Mianzhu
Norwest Plant. With the risk associated with the road reconstruction scheduled to be completed in
2015 maintaining an inventory of mined rock at the plant site will be important. Any potential shortfall in
production from Norwest mining operations can be lled with the purchase of other production in the area.
The expansion of production will require extensive development and expansion of the mine capacity at
the two Mianzhu Norwest mining sites. Over this expansion period the number of producing levels will
be increased to 14 levels to be able to mine and produce 415,000 tpa. The expanded mine production is
based on achieving approximately 30,000 tpa from each mine production level. The build up of production
is planned as shown in Table 7.
In addition to the typical past history of using aerial tramways to handle the rock from the mine portals
to truck loading bins, Mianzhu Norwest has made agreements with neighbouring mine operations
to integrate three surplus tunnels into their handling of mine rock production. These tunnels facilitate
trafc movement, material handling and truck loading further down the valley at each operation to
improve productivity, safety, and relieve congestion with truck loading. The production forecast includes
incorporation of these tunnels into the mine operations in 2013 and 2014.
TABLE 7.
MIANZHU NORWEST MINE PRODUCTION PLAN, MIANZHU NORWEST PHOSPHORITE OUTPUT
2012 2013 2014 2015 Total
Level #1 500 20,000 20,000 40,500

Level #15 30,389 30,500 33,500 50,000 150,425
Level #9
Level #4 18,230 30,500 32,500 50,000 141,,346
Level #3 5,829 18,000 25,500 40,000 103,102
Level #8 8,000 25,500 30,000 68,000
Level #1850 5,000 7,000
Level #2003 1,200 9,000 20,000 31,200
Level #2140 200 23,200 15,000 20,200
Total 54,448 88,900 169,200 230,000 561,773
Level #1815 4,800 9,800 25,500 50,000 103,363

Level #1950 2,618 9,800 19,000 50,000 100,364
Level #2050 5,100 15,000 25,000 45,100
Level #2150 500 10,000 20,000 30,500
Level #1709 7,300 25,500 35,000 70,300
Level #1600 5,000 5,000
Level #1500
Level #1400
Total 7,418 32,500 95,000 185,000 354,627

Grand Total 61,866 121,400 264,200 415,000 916,400
J-63

16.2 MINE PLAN AND FINANCIAL EVALUATION
WGM has reviewed Mianzhu Norwests proposed production plan and has completed an independent
evaluation of the economics of the project over the next 14 years. A review of the market indicates the
opportunity to sell phosphate rock produced from Mianzhu Norwest mining operations independent
of their Plant capacity. This review includes the gradual expansion of the mining capacity to 1.0 Mtpa
(million tpa) over a four year period following the scheduled completion of the reconstruction of the
haulage road in 2015. WGM has not considered what permits may be necessary to expand the mine
production nor allowed for any delays in the production schedule that may result from failure to receive
the necessary permits as required by the plan. The analysis has been projected over 14 years as the
discounted nancial indicators will not appreciably change even though the probable life of mine will
exceed this period with the current resource level that is indicated.
Included in the analysis is the capital cost estimates for establishing the production increases. The
capital estimated by WGM also includes completion of the necessary drilling to dene Measured and
Indicated Resources that can, with the appropriate application of the Modifying Factors, be converted
into Reserves as detailed in Table 11 in Section 26 as well as the ongoing exploration needed to update
the Reserves. The current surface areas being used to sustain mine production and loading of haulage
trucks will require major revisions to sustain the 1.0 Mtpa after 2018 that has been evaluated in the cash
ows. WGM has assumed that a mine expansion study would be carried out in 2014 to design the best
way to develop and operate the mines to produce 1.0 Mtpa. A capital cost allowance of US$18.8 million
has been included to complete mine development and purchase the necessary mobile equipment to
sustain the 1.0 Mtpa production. The capital cost allowance should be regarded as very preliminary with
a possible variance of plus or minus 30% as the full scope of work cannot be properly dened until a
thorough engineering study is completed. The sensitivity of the mine expansion capital cost is shown in
Figure 11 to be the least signicant to the project economics.
It has been assumed that a more international style design will be adopted to provide a higher level of
safety along with some application of trackless equipment both in the stope operation as well in rock
handling to the surface haulage trucks. It would be expected that the low labour costs of the PRC would
be integrated into the higher productivities of western style design and mining equipment.
The operating costs used in the analysis are based on historical costs of the Mianzhu Norwests
operations prior to the Wenchuan Earthquake. A summary of this nancial analysis is shown (Table 8)
with the details of the analysis included in Appendix I. The WGM evaluation is based on the information
provided by Mianzhu Norwest, but assumes a project basis (i.e. no opening balances and all previous
costs are sunk). While the Mianzhu Norwest models the years 2013 to 2015, WGM has extended the
model for 11 years with the annual production rate increasing from 415,000 tpa in 2015 to 1.0 Mtpa in
2019. Also, the WGM model is based on an ination rate of 5% of both prices and capital and operating
costs and an exchange rate of 6.1335 per US$ (May 9, 2013). While WGM believes that labour costs
in the PRC will increase faster than 5% in the coming years, the increased capital cost allowed for
some mechanization in the mine operations in the business plan should help mitigate these labour cost
increases.
As the nancial analysis demonstrates, the production plan of Mianzhu Norwest has robust economics
over the 14 years that have been analysed. The project shows an NPV of US$201.4 million (Appendix
1 and in Table 8 below) at a discount rate of 10%, an IRR of 66% and a payback period of 3.7 years
from the start of 2013. WGM regards the greatest risk to this analysis is the potential impact of the
haulage road from the mine to the Plant in the initial three years when the haulage road reconstruction is
expected to be completed.
J-64

TABLE 8.
SUMMARY OF FINANCIAL ANALYSIS OF MIANZHU NORWESTS OPERATIONS, 2012 to 2026
Description
Economic Parameters
Exchange Rate 6.1335:US$1.00 (May 9, 2013)
Ination Rate 5.0%
Analysis period 14
Phosphorus Rock Mined 10,750,600 tonnes
Products Sold
Phosphorus Rock 9,219,748 tonnes
P4 - Elemental Yellow Phosphorus 143,917 tonnes
P4 - By product (slag) 1,841,585 tonnes
P4 - By product (sludge) 16,742 tonnes
P4 - By product (Ferro phosphate) 16,742 tonnes
SHMP - Sodium Hexametaphosphate 16,053 tonnes
STPP - Sodium Tripolyphosphate 53,808 tonnes
REVENUE
Sales Prices
Phosphorus Rock 743 US$121.06
P4 21,229 US$3,461.16
P4 - By product (slag) 44 US$7.12
P4 - By product (sludge) 1,455 US$237.25
P4 - By product (ferrophosphate) 1,455 US$237.25
SHMP 12,394 US$2,020.67
STPP 11,044 US$1,800.66
Gross Revenue over 15 years
Phosphorus Rock 6,846,000,000 $1,116,100,000
P4 3,055,000,000 $498,100,000
P4 - By product (slag) 80,000,000 $13,100,000
P4 - By product (sludge) 24,000,000 $4,000,000
P4 - By product (ferrophosphate) 24,000,000 $4,000,000
SHMP 199,000,000 $32,400,000
STPP 594,000,000 $96,900,000
STPP (Existing Stocks) 0 $0
Other Income 0 $0
Total Gross Revenue 10,823,000,000 $1,764,600,000
OPERATING COSTS
Operating Costs per Tonne Product
Phosphorus Rock 303 $49.40
P4 16,896 $2,754.72
SHMP 5,993 $977.10
STPP 8,708 $1,419.75
Total Costs
Phosphorus Rock 2,914,000,000 $475,000,000
P4 2,535,000,000 $413,400,000
SHMP 101,000,000 $16,400,000
STPP 492,000,000 $80,200,000
Existing Stocks 0 $0
Total Direct Operating Costs 6,042,000,000 $985,000,000
Plus: Selling Expenses 176,000,000 $28,700,000
General & Administration 219,000,000 $35,700,000
Total Operating Costs 6,437,000,000 $1,049,400,000
J-65

TABLE 8.
SUMMARY OF FINANCIAL ANALYSIS OF MIANZHU NORWESTS OPERATIONS, 2012 TO 2026
(continued)
Description
EBITDA 4,384,000,000 $714,800,000
Less: Depreciation & Amortization 183,000,000 $29,900,000
Corporate Taxes 1,051,000,000 $171,300,000
Net Cash Operating Prot 3,153,000,000 $514,000,000
Net Cash Flow to Project
Net Cash Operating Prot 3,153,000,000 $514,700,000
Plus: Depreciation 183,000,000 $29,900,000
Less: Capital Investment 177,000,000 $28,800,000
Changes in Working Capital 0 $0
Net Cash Flow to Project 3,159,000,000 $515,100,000
Internal Rate of Return (IRR) 66%
Net Present Value of NCF disc. At 5% 1,940,000,000 $316,300,000
Net Present Value of NCF disc. At 10% 1,235,000,000 $201,400,000
Net Present Value of NCF disc. At 15% 811,000,000 $132,200,000
Payback Period 3.7 Years
Working Capital Time Delays
Accounts Receivable (Rock Only) 0 days (sold for cash)
Accounts Receivable (Remaining Products) 45 days
Accounts Payable 15 days
Product Inventory 30 days
Spare Parts and Supplies 7% of Initial Capital
WGM has also conducted an analysis to determine the sensitivity of the project Net Cash Flow to
changes in product price and capital and operating costs. The sensitivity tested these variables from
-25% to +25% of their Base Case values. As can be seen in the accompanying chart, Figure 11, the net
cash ow remains positive even at a 25% decrease in product prices. Also, as would be expected, the
project is most sensitive to sales prices, followed by operating costs and is least sensitive to changes in
capital costs.
J-66

Figure 11. Sensitivity analysis of Mianzhu Norwest net cash ow
16.3 Mine Haulage Road
Establishing a safe and reliable haulage road between the Mines and the Plant is critical to Mianzhu
Norwest carrying out their integrated production plan. Since the Wenchuan Earthquake, the road access
has required substantial work both to re-establish access as well as maintain the road in serviceable
condition. The road was again closed by the Landslide that restricted access for three months. The road
is still regarded as unstable and production could be further exposed to further interruptions.
A major part of the haulage road is the Mian-Mao Highway that connects Mianzhu City, Hanwang Town
and Qing Ping Town through to Mao County (Figure 12). The route design is for a two lane highway
with some areas of double lane width varying from 7 to 14 m. Along the highway a number of seismic
monitoring stations have been located to provide immediate warnings of seismic or rockslide activity.
The road can be divided into three parts as shown in Figure 12. The rst part is the section below (south)
the town of Qing Ping which is being looked after by the local government. This part of the highway which
is approximately 20 km follows the east side of the river and is being restored at a faster pace than the
northern section of the route. Most of this section has been elevated to prevent further damage from
rockslides. Reconstruction of the rst part was completed in May 2012.
J-67

The northern section of the haulage route above (north) of the town of Qing Ping and the bridge crossing
follows the west side of the river for about 20 km to the junction of Mine #2 access road and will extend
several kilometres toward each of Mianzhu Norwest Mines from that point. The remaining road access to
Mianzhu Norwests Mines will be the responsibility of the three phosphate producing companies, Mianzhu
Norwest together with Lomon Phosphate Company and Qing Ping Phosphate Mining Company who
operate at adjacent mines. The reconstruction of this section of the road is the responsibility of the local
PRC governments but is not scheduled for completion until 2015 based on current available information.
In the interim the three mine operating companies have agreed to provide US$159,000 to fund road
reconstruction and $0.24/tonne hauled towards maintenance of the road.
The remaining distance of 3 km to Mine #1 and 2 km to Mine #2 beyond the government access road
will also be the responsibility of the three companies using the roads and will not be subject to any
government contributions for reconstruction or maintenance.
Due to the condition on the northern section of the haulage roads at the end of November 2012, WGM
regards this as a continuing risk to safe and reliable access to the Mianzhu Norwest Mines. It is expected
to be an ongoing challenge to safety and reliability of production haulage to the processing Plant until the
reconstruction is completed in 2015 based on current available information. The reconstruction, led by
the Sichuan provincial government was started in 2013 with a budget of $3.39 MRMB. The reconstruction
includes a series of tunnels and bridges to eliminate the higher risk portions of the access route that
can be subject to ooding and landslides. By mid 2013 considerable work was started with 3 tunnel
excavations in progress, bridge construction started and crushing of construction aggregates.
The completion of the Mian Mao highway will allow the Mines to sustain their production in the future.
Until the road reconstruction is completed, Mianzhu Norwest will be required to work closely with the
other operating companies in the area as well as the local and provincial governments to repair the
existing roads common to all the operations. This work will require geotechnical measurements to assess
the numerous safety hazards and prioritize the reconstruction work. It will also include installation of
warnings and trafc controls to facilitate haulage truck movement in the narrow areas.
J-68

Figure 12. Mianzhu Norwest Mine haulage route
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J-69

16.4 MINE DEVELOPMENT
The restoration of the adits has been a priority of Mianzhu Norwest since the Earthquake. Due to
extensive rock slides in these areas and resulting instability, the accesses to the mine workings and truck
loading operations are exposed to unsafe conditions. To avoid unnecessary exposure to the hazardous
area on the surface, Mianzhu Norwest plans to develop an underground passage system at both Mines
that connects all levels to allow equipments and personnel to enter and exit the Mines through a well
established and protected main portal. These adits will be established at lower elevations in areas where
there is much reduced risk from further rock slides. The adits will also be designed with a loading pocket
with adequate capacity to support continuous truck loading in the adit and under the loading pocket.
The main adit at Mine 1 is located at Level 1950 and it requires extensive development work to become
operational including ground support at the entrance, ventilation, lighting, and installation of mine
services. The main adit at Mine 2 is located at Level 1815, and the construction will be completed in
2013. It includes reinforced concrete for ground support at the portal, an 800 tonne capacity loading
station, a wide drift that allows trucks to be move directly under the loading station. A secondary main
adit at Mine 2 is planned at Level 1703, and it will provide a second safe truck loading station to sustain
production at Mine 2.
WGM has reviewed the mine development plans and capital cost estimates provided by Mianzhu
Norwest, for both Mines in 2013. The plan consists of drift advancement on most of the existing mine
levels to create production faces and to connect levels with rock passes and ventilation raises. The
planned underground development will help Mianzhu Norwest to further explore and initiate denition of
Reserves. This will lead to more accurate mine planning and control of production capacity and grades.
During the November 2012 site visit, WGM noted that there had been is no effort made to remove the
high risk of rock slides near the main adit at Mine 2. This safety risk should be given high priority to avoid
potential injuries to the workforce as well as potential damage to equipment. Production from this area will
be subject to interruptions until this risk is removed or the production is replaced by the main portal that is
under construction.
16.5 ENVIRONMENTAL AND SOCIAL
In the course of reviewing the various aspects of the operations and facilities of Mianzhu Norwest,
WGM noted various conditions and practices that would not meet the standards of international best
practice. Mianzhu Norwest acknowledges this and has stated the desire to move their operations towards
international best practices. The current operating plans provide for capital and operating budgets to
maintain the operations in compliance with PRC regulations., The Plant being commissioned in mid
2013 is designed to operate in compliance with the environmental law of the PRC and will practice water
recycling and off gas collection as well as slag disposal at a nearby cement operation.
Provision is made for reforestation of disturbed lands in the mine areas as well as investment in a number
of areas to improve the mine workplace safety and productivity. The underground operations have
recently installed a communication and personnel locating system as well as provision of mine refuge
stations, re control and prevention, and underground air quality monitoring.
As an initiative in community social responsibility, Mianzhu Norwest has also launched an education fund
to help nance education for local students from low income families. The company plans to contribute
part of annual net prot toward the fund as well as funding scholarships for university students.
J-70

16.6 OTHER RELATIVE INFORMATION
WGM is not aware of any additional information that may be available or explanations necessary to
complete this review of the phosphate Resources in this comprehensive Technical Report. There is not
a large database available for the Cheng Qiang Yan and Shi Sun Xi of Mianzhu Norwest. There is a
report available for the mine planning and phosphate production from the Shi Sun Xi deposit. However,
this report, prepared by the Coal Design and Research Institute of Sichuan Province, does not contain
information relevant to the description and estimation of phosphorite Resources for that property and
therefore cannot accurately project an accurate tonnage and grade schedule required in a mine plan.
16.7 ADDITIONAL REQUIREMENTS
This document only reports the phosphorite Resources for the two Mines of the Mianzhu Norwest. There
are no additional requirements to report that would materially affect the estimation of the Resources.
There are some formal studies that would add to the database of information available to more fully
evaluate the potential of these properties and their ability to support other types of phosphorite products
in the future.
Among the studies mentioned above is the need to fully assess the quality of the current phosphorite
production against the possible processing by the ow sheet for wet process phosphoric acid (WPPA)
to fully evaluate possible alternative markets. In the collection of geologic data for this study (drilling,
sampling, analytical results), a complete chemical evaluation of each sample is required. These complete
analyses will also establish a basis to more fully understand the electric furnace operations and possibly,
make alterations to the process that will enhance the protibility of the overall operations and better
control possible environmental impacts.
To date no comprehensive project study has been carried out that includes drilling, denition of Reserves,
metallurgical testing, market analysis, project economics and environmental assessment although
some or all of these elements may be necessary in the future. No timetable has been presented for the
initiation or conclusion of these activities.
Mianzhu Norwest has indicated that the economic conditions of working the licenses are not considered
a signicant operational cost item. These include but are not limited to one time purchase fees for the
lands for the processing facilities, exploration and mining licence renewal and applications fees and
environmental and closure (abandonment) costs.
The company has also complied with and obtained the required Mine safety permits and has installed
waste water treatment facilities at the mine sites and has also budgeted for the improvement and
maintenance of access roads (in conjunction with its neighbours).
The company also provides monetary compensation for a timberland compensation and forest recovery
fund bi-yearly and has set aside provisions for rehabilitation and reforestation upon mine closure. The
current surface areas at the mine sites are steeply inclined, poorly vegetated and subject to extensive
natural erosion and hence the cost for this are not signicant.

J-71

17. INTERPRETATION AND CONCLUSIONS
WGMs interpretations and conclusions are that the primary phosphogenesis and accumulation events for
the material contained in the phosphorite bed of interest on both Mianzhu Norwest properties occurred
in Lower Cambrian times. These are the same events that fostered the deposition of the Meishucun
Formation in the area. In the Mianzhu City area, the Meishucun Formation accounts for probably up to
80% of the phosphorite production (pre-earthquake). Between Lower Cambrian times and the Upper
Devonian times there was a period of depositional hiatus and erosion. In Upper Devonian times, a
marine transgression fostered the nal erosion of the Lower Cambrian phosphorite beds in the area
and redeposited this material on the undulating topographic surface previously created at the top of the
Upper Sinian Deng Ying Formation. This event was wide spread enough that the local Sichuan Province
geological teams created a special deposit type and name for the resulting phosphorite bed(s) the
Shi Fang Type. These geologists have assigned an Upper Devonian age for the Shi Fang type deposit
and, locally, assigned the geologic symbol D
3
S
1
for its identication.
The tectonic movements, beginning over 600 million years ago, have formed a suture zone and zone
of deformation that includes all of the phosphorite producing area in west of the Mianzhu City area of
Sichuan Province. These same tectonic movements (primarily compression with a slight right-lateral
strike-slip vector) have formed a region of intense folding and thrust faulting which greatly complicates
the structural geology of the area. Primary structural control is strongly inuenced by the early Mesozoic,
and previous, faulting. More recent events often re-activate these older structures. The fault that appears
to have broken in the Wenchuan Earthquake is at or very near the boundary between the Precambrian
rocks of the Pengguan Massif and the Mesozoic fore deep sediments of the Sichuan Basin. The fault
has a history of mostly right-lateral strike-slip and a smaller amount of thrust motion. Based on historical
seismic activity, it is reasonable to expect repeat events in the future due to the geologic structures and
features The intensity of the major earthquakes can again reach a Mercalli intensity VIII, and mining
operations as well as other construction in the region should designed accordingly.
WGM, using computer modelling, has estimated the phosphorite Resources for Mianzhu Norwests Mines
in west-central Sichuan Province. Table 9 presents the total Mineral Resource estimate for Cheng Qiang
Yan property as prepared by WGM for Mianzhu Norwests license holdings. Average bed thickness and
average P
2
O
5
content are weight averaged by tonnes from various applicable polygons resulting from the
estimating process.
J-72

TABLE 9.
ESTIMATED PHOSPHORITE RESOURCES FOR CHENG QIANG YAN
Tonnes
(million)
Bed Thk
(m)
P2O5
(%)
Mining License Area
Total Resource Measured 3.0 5.33 28.61
Indicated
Inferred** 0.9 3.86 26.77
M & I Resource* Measured 3.0 5.33 28.61
Indicated
TOTAL 3.0 5.33 28.61
Under Exploration License Area
Indicated
Inferred**
Indicated
TOTAL 0.3 2.91 29.44
Table 10 presents the total phosphorite Resource estimate for Shi Sun Xi property as prepared by WGM
for Mianzhu Norwests license holdings. Average bed thickness and average P
2
O
5
content are weight
averaged by tonnes from the various applicable polygons resulting from the estimating process.
TABLE 10.
ESTIMATED PHOSPHORITE RESOURCES FOR SHI SUN XI
Tonnes
(million)
Bed Thk
(m)
P2O5
(%)
Mining License Area
Indicated 10.7 7.05 29.77
Inferred** 1.8 6.79 30.02
Indicated 10.7 7.05 29.77
TOTAL 17.6 6.96 29.57
Under Exploration License Area
Indicated 1.3 6.18 26.71
Inferred** 16.1 8.07 29.74
Indicated 1.3 6.18 26.71
TOTAL 1.4 6.07 26.55
J-73

The Resource estimates made in this report are based on the assumption of the existence of one
continuous mineralized bed on the licenses. There is a reasonable expectation that further exploration of
the license areas can contribute to increases in the Resources resulting from better understandings of the
local structure and thickness of the mineralization.
From a phosphorite quality viewpoint, the phosphorite Resources controlled by Mianzhu Norwest are
higher grade than many of the nearby phosphorite deposits that have been interpreted to be of a different
geologic age. The Shi Fang type of phosphorite deposit has been in production in the region for many
years providing a great deal of experience in processing products from this deposit type. The products
produced from the Shi Fang deposits include elemental phosphorus and downstream products as well as
fertilizer products from wet process phosphoric acid.
J-74

18. RECOMMENDATIONS
In general WGM recommends that, Mianzhu Norwest should continue with the post-Wenchuan
Earthquake business plan that accommodates the current conditions of each of the Mines. This should
include the scope, schedule and cost of the restoration of full production as well as the long-term
approach for the operations taking into consideration current and projected markets. The plan should
address the type of operation necessary to reach standards that are more analogous to international best
practice and that may be necessary for compliance with potential future state requirements, company
standards, or possibly required by the future market place standards such as ISO.
In recognition of the possible interruption of haulage of rock from the Mines to the Plant Mianzhu Norwest
must continually work with the neighbouring operations to prioritize the risks to the road north of Qing
Ping Town. This should include a geotechnical assessment and prioritizing of the risks with the scaling
down of loose rock or securing of all potential rock slides. With the extensive construction work planned
for the northern portion of the route until 2015, there will be a need to plan haulage of mine production
during periods of reduced activity to maintain a stockpile at the processing site to ensure continuous
operations.
At the mine adits and truck loading locations Mianzhu Norwest has a good start on establishing
production points from more stable areas lower in the valley and making the existing locations safer by
scaling or securing potential rock slides. With the increasing production requirements, it will be possible
to achieve the higher level of safety in the better locations for truck loading while at the same time
increasing the mine production capacity. The portal construction currently in progress should be continued
on a priority basis. Mianzhu Norwest currently has budgeted $720,000 at Mine #1 and $1,700,000 at
Mine #2 to reconstruct the portals for safer and higher capacity truck loading. The good progress on this
construction was evident during the November 2012 site visit.
A thorough analysis of the current production capacity of the mine levels should be carried out to
determine where the limitations are and how capacity can be increased above the current average of
20,000 tpa for each level. Mianzhu Norwest has currently budgeted $220,000 for Mine #1 and $1,200,000
for Mine #2 to expand the level haulage systems towards achieving the increased capacity necessary to
sustain the budgeted production. WGM regards the work in progress during the last site visit as well as
the budgets in place as signicant steps towards establishing safer operations at both mines as well as
advancing the mines to higher production capacities.
Each of the Mines needs additional geologic denition with further exploration drilling and sampling
to allow more accurate mine planning. Current practices of exploration through production should
be abandoned in favour of a more extensive exploration drilling to remove more of the risk to mine
production and grade control.
All future exploration sampling should include expanded chemical analyses. The recommended expanded
analytical suite will allow judgements to be made by Mianzhu Norwest regarding possible new processing
technologies and possibly new products/markets. Currently, information that allows alternative processing
evaluations appears to be totally absent. The information will also provide records for environmental
assessment as well as data to support environmental compliance and possible control and mitigation
measures that may become necessary.
J-75

The following exploration program is proposed for the denition of Reserves to allow development of
lower risk mine plans and more accurate production forecasts. Raising the classication of the Resources
on an ongoing basis is regarded as good management practice and will be a requirement for a publicly
listed company. It is necessary to plan annual expenditures to raise the classication of the Resource
and replace the Reserves on an ongoing basis. The program should also include an annual reconciliation
of mine production against the Resources and Reserves to assess the accuracy of the mine planning,
grade control, mine dilution and other factors that can impact production and costs. The following program
is considered what is necessary to initiate these normal management practices at Mianzhu Norwests
operations and the scope of ongoing annual programs will need to be reviewed following the rst year.
The program anticipated will include mine development in the footwall to allow access to drill the
phosphate bed in a fan of holes. It is anticipated that the drifts would be sized and located so they can
be used for production haulage ways as mining progresses. Crosscuts further back into the footwall may
be necessary to allow the drilling to collar multiple holes from each drill station and reduce the costs of
the program. The drill core will be sampled across the mineralized bed as well as the contact zone at
the hanging wall and footwall to allow better control of dilution and provide for more accurate estimates
of the ore grade to be mined. It is anticipated that the initial drilling program will be able to use existing
production drifts already developed in the two mines to start the drilling program.
In addition to analysing the samples for the phosphate grade, the program should determine all
constituents in the rock to establish an information base for future reference in reviewing processing
operations, environmental issues, market requirements, etc. The samples may also be used to support
bench scale metallurgical testing to support the ongoing operations or evaluation of potential processing
options.
The following budget estimate (Table 11) is the suggested scope of work in the initial year to start the
ongoing program at Mianzhu Norwests Mines.
J-76

TABLE 11.
INITIAL DEVELOPMENT PROGRAM BUDGET ESTIMATE
Conversion of RMB/US$ at 0.157867 (March 14, 2012)
Item Units RMB/Unit Units Used Total RMB US$ Total
Cheng Qiang Yan
Mining Development
Galleries Units 107,300 2 214,600 33,878
Drilling Metres 751 1000 751,000 118,558
Samples Metres 590 50 29,500 4,657
Level 8 -- 2281 elev Metres 1,073 250 268250 42,348
Galleries Units 107,300 2 214,600 33,878
Drilling Metres 751 800 600,800 94,846
Samples Metres 590 50 17,700 2,794
Galleries Units 107,300 2 214,600 33,878
Drilling Metres 751 800 600,800 94,846
Samples Metres 590 50 29,500 4,657
Vertical Drilling Holes 2
Drilling Metres 751 750 563,250 88,919
Samples Metres 590 15 8,850 1,397
Trenching
Digging Units 107,300 1 107,300 16,939
Samples Metres 590 10 5,900 931
Management
5% of Above 221,600 34,983
TOTAL 5,760,800 909,440
Shi Sun Xi
Mining Development
Vertical Drilling
Mining License Holes 2
Drilling Metres 751 800 600,800 94,846
Samples Metres 590 20 11,800 1,863
Exploration License Holes 3
Drilling Metres 751 1,200 901,200 142,270
Samples Metres 590 25 14,750 2,329
Trenching
Management
5% of Above 76,400 12,061
TOTAL 1,987,200 313,713
GRAND TOTAL (both mines) 7,748,000 1,223,154
J-77

19. DATE AND SIGNATURE PAGE
This report titled A Technical Review of the Cheng Qiang Yan Phosphate Deposit and Shi Sun Xi
Phosphate Deposit, Mianzhu City, Sichuan Province, Peoples Republic of China for AsiaPhos Private
Limited dated February 28, 2013 was prepared and signed by the following authors:
Dated effective as of February 28, 2013.

Donald H. Hains, P.Geo.
Senior Associate Industrial Minerals Specialist
J-78

DATE AND SIGNATURE PAGE OF
WATTS, GRIFFIS AND McOUAT LIMITED
The principal authors of this report titled A Technical Review of the Cheng Qiang Yan Phosphate
Deposit and Shi Sun Xi Phosphate Deposit, Mianzhu City, Sichuan Province, Peoples Republic of China
for AsiaPhos Private Limited dated February 28, 2013, Donald Hains and G. Ross MacFarlane, both
associates of Watts, Grifs and McOuat Limited (the Qualied Persons), completed their work under the
direct supervision of Joe Hinzer, P.Geo., the President and Director of Watts, Grifs and McOuat Limited.
WGM and their associates are independent of AsiaPhos Private Limited, its directors and substantial
shareholders.
WGM and their associates do not have any interest, direct or indirect, in AsiaPhos Private Limited, its
subsidiaries or associated companies and will not receive benets other than remuneration paid to the
Qualied Persons in connection with the Qualied Persons report.
Remuneration paid to the Qualied Persons or WGM in connection with this report is not dependent on
the ndings of this report.
Each of Watts, Grifs and McOuat Limited, Donald H. Hains and G. Ross MacFarlane, the qualied
persons producing the WGM Technical Report, has conrmed that it/he has reviewed the information
contained in the Offer Document which relates to the WGM Technical Report and further conrmed that
the information presented therein is accurate, balanced, complete and not inconsistent with the WGM
Technical Report.
Dated effective as of February 28, 2013.
Joe Hinzer, P.Geo.
President and Director
J-79

CERTIFICATE
I, Donald H. Hains, hereby certify that:
1. I reside at 2275 Lakeshore Blvd. West, Suite 515, Toronto, Ontario, Canada, M8V3Y3.
2. I am a Senior Associate Industrial Minerals Specialist with Watts, Grifs and McOuat Limited, a
rm of consulting geologists and engineers, which has been authorized to practice professional
engineering by Professional Engineers Ontario since 1969, and professional geoscience by the
Association of Professional Geoscientists of Ontario.
3. This certicate accompany the report titled A Technical Review of the Cheng Qiang Yan Phosphate
Deposit and Shi Sun Xi Phosphate Deposit, Mianzhu City, Sichuan Province, Peoples Republic of
China for AsiaPhos Private Limited dated February 28, 2013.
4. I am a graduate from the Dalhousie University, Ontario with a MBA (Finance & Marketing) Degree
in 1976, and from Queens University, Ontario, Canada with a Honours B.A. (Chemistry) Degree in
1974.
5. I am a Professional Geoscientist licensed by Association of Professional Geoscientists of Ontario
(Membership Number 0494). I am also a member of: the Society for Mining, Metallurgy and
Exploration (SME, #4175075, the American Ceramics Society (#48643), Metallurgical Society
of AIME (#45887), Society Manufacturing Engineers (#2866887), Technical Association Pulp &
Paper Industry, Canadian Institute of Mining and Metallurgy (#93478), and the Prospectors and
Developers Association of Canada (#1026).
6. I have practised my profession as a geoscientist continuously since 1976. My experience with
phosphate mining and processing projects includes the following:
NI 43-101 report on the Lianlianping Phosphate Mine, Hubei Province, PRC, May 2009;
Resource estimate, scoping study and valuation of a proposed phosphate mine and SSP
plant in Brazil, 2002;
Due diligence technical assistance to joint-venture partner for Martison phosphate project,
Ontario, Canada, 2008-2009;
NI 43-101 reports for Mantaro phosphate project, Peru, 2007, 2008, 2010;
Due diligence technical review and QP supervision of Paris Hills phosphate project, Paris
Hills, Idaho, USA;
Review and analysis of phosphate exploration projects by Maaden, Kingdom of Saudi
Arabia, 2010-2011;
Due diligence technical review of various phosphate projects in Mexico, 2009, 2011 and
2012;
Due diligence technical review of phosphate exploration project, Togo, West Africa, 2009;
Due diligence technical review of phosphate exploration project, Ferni district, British
Columbia, 2009; and
Review of Cargill Township phosphate project, Ontario, 1998.
7. I have read the denition of qualied person set out in the National Instrument 43101 (NI 43-
101) and certify that by reason of my education, afliation with a professional association (as
dened in NI 43-101) and past relevant work experience, I fulll the requirements to be a qualied
person for the purposes of NI 43-101.
8. I have read the denition of qualied person set out under Section B of the Listing Manual of the
SGX-ST (the Catalist Rules) and certify that I fulll the requirements to be a qualied person for
the purposes of the Catalist Rules.
J-80

9. I have not visited the Cheng Qiang Yan Phosphate and Shi Sun Xi Phosphate properties.
10. I have carefully reviewed Sections 7,8,9,10,11,12,13,14,15,16,17,20 and 21 of the report and
the analysis prepared by Mr. James Spalding, P.Geo. I concur with the analysis and conclusions
respecting the geology, mineralization, analytical methods, sample preparation and handling,
mineral processing and Resource estimates prepared by Mr. Spalding.
11. I am independent of the issuer as described in Section 1.5 of NI 43-101.
12. I have not worked for AsiaPhos Private Limited in the Property areas or elsewhere.
13. I have read NI 43-101, Form 43-101F1 and the technical report and have prepared the technical
report in compliance with the standards as pertaining to NI 43-101, Form 43-101F1 and generally
accepted Canadian mining industry practice.
14. As of the date of the technical report, to the best of my knowledge, information and belief, the
technical report contains all scientic and technical information that is required to be disclosed to
make the technical report not misleading.
Donald H. Hains
February 28, 2013
J-81

CERTIFICATE
I, G. Ross MacFarlane, do hereby certify that:
1. I reside at 1302 Woodgrove Place, Oakville, Ontario, Canada, L6M 1V5.
2. I am a Senior Associate Metallurgical Engineer with Watts, Grifs and McOuat Limited, a rm
of consulting engineers and geologists, which has been authorized to practice professional
engineering by Professional Engineers Ontario since 1969, and professional geoscience by the
Association of Professional Geoscientists of Ontario.
3. This certicate accompany the report titled A Technical Review of the Cheng Qiang Yan Phosphate
Deposit and Shi Sun Xi Phosphate Deposit, Mianzhu City, Sichuan Province, Peoples Republic of
China for AsiaPhos Private Limited dated February 28, 2013.
4. I am a graduate of the Technical University of Nova Scotia, Halifax, Nova Scotia, with a Bachelor
of Engineering, Mining with Metallurgy Option in 1973 and have practiced my profession since that
time. I have more than 35 years of experience in the operation, evaluation, and design of mining
and milling operations.
5. I am a Professional Engineer licensed by Professional Engineers Ontario (Registration Number
28062503).
6. I have read the denition of qualied person set out in the National Instrument 43101 (NI 43-
101) and certify that by reason of my education, afliation with a professional association
(as dened in NI 43101) and past relevant work experience with metal and industrial mineral,
operations including underground mining and mineral processing operations, I fulfill the
requirements to be a qualied person for the purposes of NI 43-101.
7. I have read the denition of qualied person set out under Section B of the Listing Manual of the
SGX-ST (the Catalist Rules) and certify that I fulll the requirements to be a qualied person for
the purposes of the Catalist Rules.
8. I visited the Property on February 27, 2010 and November 28, 2011.
9. I am responsible with co-author Donald Hains for all Sections of this report.
10. I am independent of the issuer as described in Section 1.5 of NI 43-101.
11. I have not worked for AsiaPhos Private Limited in the Property areas or elsewhere.
12. I have read NI 43-101, Form 43-101F1 and the technical report and have prepared the technical
report in compliance with the standards as pertaining to NI 43-101, Form 43-101F1 and generally
accepted Canadian mining industry practice.
13. As of the date of the technical report, to the best of my knowledge, information and belief, the
technical report contains all scientic and technical information that is required to be disclosed to
make the technical report not misleading.
February 28, 2013
J-82

CONSENT OF QUALIFIED PERSON
Dear Sirs/Mesdames:
Re: AsiaPhos Private Limited (the Company)
I, Donald H. Hains, P.Geo., Senior Associate Industrial Mineral Specialist of Watts, Grifs and McOuat
Limited, do hereby consent to the ling of the technical report entitled A Technical Review of the Cheng
Qiang Yan Phosphate Deposit and Shi Sun Xi Phosphate Deposit, Mianzhu City, Sichuan Province,
Peoples Republic of China for AsiaPhos Private Limited dated February 28, 2013 (the Technical
Report).
I also consent to any extracts from or a summary of the Technical Report in an Offer Document led
by the Company dated 27 August 2013 (the Offer Document) and to the public ling of the Technical
Report with the securities regulatory authorities and stock exchange.
Technical Report.
Dated this 28
rd
day of February, 2013.
Yours truly,

Donald H. Hains, P.Geo.,
Senior Associate Industrial Mineral Specialist
J-83

CONSENT OF QUALIFIED PERSON
Dear Sirs/Mesdames:
Re: AsiaPhos Private Limited (the Company)
I, G. Ross MacFarlane, P.Eng., Senior Associate Metallurgical Engineer of Watts, Grifs and McOuat
Limited, do hereby consent to the ling of the technical report entitled A Technical Review of the Cheng
Qiang Yan Phosphate Deposit and Shi Sun Xi Phosphate Deposit, Mianzhu City, Sichuan Province,
Peoples Republic of China for AsiaPhos Private Limited dated February 28, 2013 (the Technical
Report).
I also consent to any extracts from or a summary of the Technical Report in an Offer Document led
by the Company dated 27 August 2013 (the Offer Document) and to the public ling of the Technical
Report with the securities regulatory authorities and stock exchange.
Technical Report.
Dated this 28
th
day of February, 2013.
Yours truly,
J-84

REFERENCES
Canadian Institute of Mining, Metallurgy and Petroleum
Dec. 2005 CIM Definition Standards On Mineral Resources and Mineral Reserves
(adopted by CIM Council on 12/11/05).
Coal Design & Research Institute of Sichuan Province
Apr. 2006 Mineral Resources Development and Utilization Solution for Sichuan Mianzhu
Norwest Phosphate Chemical Company Ltd (Shi Sun Xi Phosphorite Mine).
Feb. 2006 Sichuan Mianzhu Norwest Phosphate Chemical Company Ltd. (Shi Sun Xi
Phosphorite Mine) Initial Design of Expansion Program.
Ontario Securities Commission
2005 NI 43-101 Standards of Disclosure for Mineral Projects.
Sichuan Institute of Chemical Engineering and Geological Exploration
2009 Additional exploration of geological report for Sichuan Mianzhu Norwest Chemical
Company Ltd (Shi Sun Xi Phosphorite Mine).
2005 Mining Geology Environmental Impact Statement about Sichuan Mianzhu Norwest
Phosphate Chemical Company Ltd (Shi Sun Xi Phosphorite Mine).
1998 Census Survey Report of Phosphorite Reserve in the School-Run Cheng Qiang
Yan Phosphorite Mine at Qing Ping Town, Mianzhu City, Sichuan Province.
United States Geological Survey
1983 Coal Resource Classication System of the U.G. Geological Survey in Geological
Survey Circular 891.
1980 Principles of a Resource/Reserve Classication For Minerals in Geological Survey
Circular 831.
1976 Coal Resource Classication System of the U.S. Bureau of Mines and U.S
Geological Survey in Geological Survey Bulletin 1450-B.
NOTE: Not all Sections from all Chinese reports, cited above, have been translated into English for this Technical report.
J-85

APPENDIX 1:
FINANCIAL ANALYSIS
J-86

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J-90

APPENDIX 2:
DETAILS OF RESOURCE CALCULATIONS
J-91

MINE 1 CHENG QIANG YAN
Category Sample Tonnage Thickness P2O5 (%) Remarks
E_Measured 3OP3 117,000 4.95 29.90
E_Measured 5Y3 14,000 4.02 26.87
E_Measured 8OP1 1,000 4.52 34.38
E_Measured 8Y2 20,000 1.04 29.90
E_Measured 8Y3 98,000 0.67 29.10
E_Measured 250,000 2.91 29.44

M_Measured TC101 390,000 13.84 32.20
M_Measured TC103 165,000 5.04 25.38
M_Measured TC104 161,000 5.76 33.03
M_Measured TC105 148,000 4.85 18.51
M_Measured TC106 114,000 4.35 33.32
M_Measured 3OP1 33,000 4.59 30.99
M_Measured 3OP2 1,000 5.46 31.24
M_Measured 3OP3 4.95 29.90
M_Measured 5Y1 110,000 3.93 28.84
M_Measured 5Y2 414,000 3.94 28.83
M_Measured 5Y3 649,000 4.02 26.87
M_Measured 5Y4 560,000 3.86 26.77
M_Measured 8OP1 169,000 4.52 34.38
M_Measured 8Y2 42,000 1.04 34.09
M_Measured 8Y3 86,000 0.67 29.99
M_Measured 3,042,000 5.33 28.61
M_ Inferred 918,000 3.86 26.77 Upthrust side of fault
M_ Inferred 918,000 3.86 26.77
Measured 3,292,000 5.15 28.67
Indicated
Measured and Indicated 3,292,000 5.15 28.67
Inferred 918,000 3.86 26.77
E Exploration licence
M Mine licence
J-92

MINE 2 SHI SUN XI
Category Sample Tonnage Thickness P2O5(%)
E_ Measured ZK705 32,000 1.37 19.76
E_ Measured 32,000 1.37 19.76
E_Indicated ZK1001 829,000 9.02 30.84
E_Indicated ZK903 20,000 6.65 26.58
E_Indicated ZK705 492,000 1.37 19.76
E_Indicated 1,341,000 6.18 26.71
E_Inferred ZK1001 13,061,000 9.02 30.84
E_Inferred TC126 195,000 1.08 31.65
E_Inferred ZK903 1,506,000 6.65 26.58
E_Inferred ZK705 1,052,000 1.37 19.76
E_Inferred TC126 268,000 1.08 31.65 Upthrust side of fault
E_Inferred 16,081,000 8.07 29.74
M_Measured ZK1001 2,284,000 9.02 30.84
M_Measured TC126 169,000 1.08 31.65
M_Measured ZK902 1,062,000 4.94 31.94
M_Measured ZK903 1,977,000 6.65 26.58
M_Measured L2050 496,000 4.00 29.50
M_Measured TC125 69,000 1.24 17.77
M_Measured TC124 1,000 7.08 27.01
M_Measured L1950 662,000 7.60 28.60
M_Measured ZK701 73,000 5.77 32.25
M_Measured ZK705 78,000 1.37 19.76
M_Measured 6,871,000 6.81 29.25
M_Indicated ZK1001 5,008,000 9.02 30.84
M_Indicated ZK902 1,124,000 4.94 31.94
M_Indicated L2050 646,000 4.00 29.50
M_Indicated TC126 489,000 1.08 31.65
M_Indicated ZK903 2,533,000 6.65 26.58
M_Indicated ZK701 588,000 5.77 32.25
M_Indicated ZK703 145,000 7.96 28.26
M_Indicated ZK705 148,000 1.37 19.76
M_Indicated L1950 21,000 7.60 28.60
M_Indicated ZK705 18,000 1.37 19.76
M_Indicated 10,718,000 7.05 29.77
M_Inferred ZK902 380,000 4.94 31.94
M_Inferred TC126 163,000 1.08 31.65
M_Inferred ZK1001 471,000 9.02 30.84
M_Inferred ZK1001 294,000 9.02 30.84
M_Inferred ZK903 473,000 6.65 26.58
M_Inferred 1,781,000 6.79 30.02
Measured 6,903,000 6.78 29.21
Indicated 12,059,000 6.95 29.43
Measured and Indicated 18,962,000 6.89 29.35
Inferred 17,862,000 7.94 29.77
E Exploration licence
M Mine licence
J-93

SUMMARY
Tonnes P2O5(%) Thickness(m)
Measured
Mine 9,913,000 29.05 6.36
Exploration 282,000 28.34 2.74
Total 10,195,000 29.03 6.26
Indicated
Mine 10,718,000 29.77 7.05
Exploration 1,341,000 26.71 6.18
Total 12,059,000 29.43 6.95
Measured + Indicated
Mine 20,631,000 29.43 6.72
Exploration 1,623,000 26.99 5.58
Total 22,254,000 29.25 6.63
Inferred
Mine 2,699,000 28.91 5.79
Exploration 16,081,000 29.74 8.07
Total 18,780,000 29.62 7.74
K-1
APPENDIX K: INDEPENDENT VALUATION REPORT
VALUATION REPORT
CONSIDERING
THE FAIR MARKET VALUE OF
THE MINING PROJECT COMPRISING OF
CHENG QIANG YAN PHOSPHATE DEPOSIT AND
SHI SUN XI PHOSPHATE DEPOSIT
Client : AsiaPhos Limited
Ref. No. : CON000125904
Report Date : 27 August 2013
K-2
27 August 2013
AsiaPhos Limited
600 North Bridge Road
Parkview Square #12-01
Singapore 188778
Dear Sirs,
INDEPENDENT VALUATION OF THE FAIR MARKET VALUE OF THE MINING PROJECT
COMPRISING OF
CHENG QIANG YAN PHOSPHATE DEPOSIT AND SHI SUN XI PHOSPHATE DEPOSIT
Executive Summary
Scope of Report
In accordance with your instructions, Jones Lang LaSalle Corporate Appraisal and Advisory Limited
(JLL) has prepared an independent opinion on the Fair Market Value of the Mining Project comprising
of Cheng Qiang Yan Phosphate Deposit, Shi Sun Xi Phosphate Deposit, and the P
4
processing plant (the
Project) at Mianzhu City, Sichuan Province, the Peoples Republic of China (the PRC) as at 31 March
2013 (the Valuation Date). The Project is owned by Sichuan Mianzhu Norwest Phosphate Chemical
Co. Ltd. (Mianzhu Norwest or the Company), a 100%-owned subsidiary of Norwest Chemicals Pte Ltd
(Norwest Chemicals), which in turn will be a wholly-owned subsidiary of AsiaPhos Limited (AsiaPhos).
This report has been prepared for inclusion in the offer document (the Offer Document) of AsiaPhos
in connection with the listing of the shares of AsiaPhos on the Catalist Board of Singapore Exchange
Securities Trading Limited (the SGX-ST). The report that follows is dated 27 August 2013 (the Report
Date).
Standards Used
This report has been prepared and presented in accordance with the guidelines set by the Code for the
Technical Assessment and Valuation of Mineral and Petroleum Assets and Securities for Independent
Expert Reports 2005 Edition (the VALMIN Code), prepared by the VALMIN Committee, a joint
committee of the Australasian Institute of Mining and Metallurgy, the Australian Institute of Geoscientists
and the Mineral Industry Consultants Association with the participation of the Australian Securities and
Investment Commission, the Australian Stock Exchange Limited, the Minerals Council of Australia, the
Securities Association of Australia and representatives from the Australian nance sector.
Basis of Report
The valuation was carried out on a Fair Market Value basis. Fair Market Value is dened as the amount
of money (or the cash equivalent of some other consideration) determined by the Expert in accordance
with the provisions of the VALMIN Code for which the Mineral or Petroleum Asset or Security should
change hands on the Valuation Date in an open and unrestricted market between a willing buyer and a
willing seller in an arms length transaction, with each party acting knowledgeably, prudently and without
compulsion.
Interpretation
The valuation contains calculations and forecasts based on data provided by the Company as well as
those contained in the report entitled A Technical Review of the Cheng Qiang Yan Phosphate Deposit
and Shi Sun Xi Phosphate Deposit, Mianzhu City, Sichuan Province, Peoples Republic of China for
AsiaPhos Private Limited (the ITR), prepared by Watts, Grifs and McOuat Limited (WGM). The ITR
estimates that the Project holds 20.6 million in situ tonnes of Measured and Indicated (M&I) Resources,
at a grade of 29.43% P
2
O
5
under the mining license.
K-3
Conclusion of Report
The conclusion of value is based on accepted valuation procedures and practices that rely substantially
on the use of numerous assumptions and consideration of various factors that are relevant to the
operation of the Company. Considerations of various risks and uncertainties that have potential impact on
the business have also been made. We have conducted a site visit and have reviewed a large amount of
data pertaining to the geology, exploration results, mine planning and economic viability of the Project.
By agreement with the client, the valuation date is 31 March 2013 and this report has been prepared
on the basis of project information available up to that date unless as specically stated in the text.
This report may contain information, such as third party industry analysis, which are available up
to the Valuation Date. The opinions expressed herein are given in good faith and we believe that any
assumptions or interpretations made by it are reasonable.
We accept no responsibility for the completeness or adequacy of the information provided by the
Company and its advisors and for information extracted from public resources. Having made reasonable
enquiries and exercised our judgment on the reasonable use of such information, we found no reason
to doubt the accuracy or reliability of the information. No opinion has been expressed on matters that
require legal or other specialized expertise or knowledge, beyond what is customarily employed by
valuers. The conclusions assume continuation of prudent management over whatever period of time that
is reasonable and necessary to maintain the character and integrity of the assets valued.
JLL has undertaken a valuation of the Project using a discounted cash ow approach.
Based on the results of our investigations and analysis outlined in the report which follows, we are of the
opinion that the Fair Market Value of the Project as at the Valuation Date is in the range of RMB1.0 billion
to RMB1.6 billion with the preferred value being RMB1.3 billion.
The following pages outline the factors considered, methodology and assumptions employed in
formulating our opinions and conclusions. Any opinions are subject to the assumptions and limiting
conditions contained therein.
Yours faithfully,
For and on behalf of
Jones Lang LaSalle Corporate Appraisal and Advisory Limited
(Registered Address: 6/F Three Pacic Place, 1 Queens Road East, Hong Kong)
Johannes F. Erasmus P.Geo
Principal Consultant
BSc. (Geology), Graduate Diploma Engineering
(Mining), MSc (Mineral Economics), Professional
Geoscientist
Simon M.K. Chan
Regional Director
B. Commerce, FCPA, FCPA (Aust.), Member of
CIM and IACVA
Johannes has the appropriate relevant qualications, experience and competence to be considered an
K-4
Expert under the denitions provided in the NI43-101, JORC and VALMIN Codes and a Competent
Person as dened in the NI43-101 and JORC Code. Johannes has been involved in the mining industry
since 1979 and has extensive experience in exploration and due diligence assessment of mining projects
and has completed a number of mining project valuations.
Simon has extensive work experience in valuation and corporate advisory industries. He has provided a
wide range of valuation services to numerous listed and listing companies of different industries in China,
Hong Kong, Singapore and the United States. The valuation services provided include rm valuation,
equity valuation, mining rights and mineral assets valuation. Simon has participated in certain large scale
IPOs of State-owned and privately-owned enterprises in China. He has successfully assisted various
multinational companies invested in China and has provided different extent of valuable due diligence
services for these companies.
The valuers, JLLs partners, directors, substantial shareholders and their associates are independent of
AsiaPhos, its directors and substantial shareholders and the valuers, JLLs partners, directors, substantial
shareholders and their associates do not have any interest (direct or indirect) in AsiaPhos, its subsidiaries
or associated companies and will not receive benets other than remuneration paid to the valuers
(Qualied Person) in connection with this Report (pursuant to the SGX-ST Listing Manual Catalist
Board listing rules for mineral, oil and gas companies).
The valuers and JLLs compensation is not contingent upon the amount of the value estimate,
the attainment of a stipulated result, the occurrence of a subsequent event, or the reporting of a
predetermined value or direction in value that favors the cause of the client.
K-5
TABLE OF CONTENTS
A. SCOPE ....................................................................................................................................... K-6
B. BASIS OF VALUE ...................................................................................................................... K-6
C. BASIS OF OPINION .................................................................................................................. K-6
D. STATEMENT OF COMPETENCE ............................................................................................. K-7
E. SOURCES OF INFORMATION ................................................................................................. K-7
F. INDEPENDENT TECHNICAL REPORT .................................................................................... K-7
G. SITE INSPECTION .................................................................................................................... K-8
H. VALUATION APPROACH .......................................................................................................... K-8
I. ASSUMPTIONS ......................................................................................................................... K-9
J. PROJECT BACKGROUND ....................................................................................................... K-9
K. LOCATION AND ACCESS ........................................................................................................ K-10
L. GEOLOGICAL SETTING .......................................................................................................... K-11
M. TENEMENT AND TENURE ....................................................................................................... K-12
N. ENCUMBRANCES .................................................................................................................... K-12
O. EXISTING EXPLORATION AND OPERATIONAL READINESS .............................................. K-12
P. MAJOR VALUATION ASSUMPTIONS ...................................................................................... K-13
Q. DISCOUNTED CASH FLOW VALUATION ................................................................................ K-22
R. RISKS ........................................................................................................................................ K-23
S. DISCOUNT RATE ...................................................................................................................... K-25
T. VALUATION COMMENTS ......................................................................................................... K-26
U. OPINION OF VALUE ................................................................................................................. K-27
V. LIMITING CONDITIONS ............................................................................................................ K-27
EXHIBIT A LIMITING CONDITIONS ................................................................................................ K-28
EXHIBIT B VALUERS BIOGRAPHY ............................................................................................... K-30
EXHIBIT C VALUERS PROFESSIONAL DECLARATION .............................................................. K-32
EXHIBIT D GLOSSARY ................................................................................................................... K-35
EXHIBIT E VALUATION RESULT FOR PREFERRED VALUE ........................................................ K-36
K-6
A. SCOPE
The purpose of this valuation is to express an independent opinion on the Fair Market Value of the Mining
Project comprising of Cheng Qiang Yan Phosphate Deposit, Shi Sun Xi Phosphate Deposit, and the P
4

processing plant (the Project) at Mianzhu City, Sichuan Province, the Peoples Republic of China (the
PRC) as at 31 March 2013 (the Valuation Date). The Project is owned by Sichuan Mianzhu Norwest
Phosphate Chemical Co. Ltd. (Mianzhu Norwest or the Company), a 100%-owned subsidiary of
Norwest Chemicals Pte Ltd (Norwest Chemicals), which in turn will be a wholly-owned subsidiary of
AsiaPhos Limited (AsiaPhos). The report that follows is dated 27 August 2013 (the Report Date).
The Project comprises:
Cheng Qiang Yan Property A single phosphate deposit with an underground mining operation in
production
Shi Sun Xi Property A single phosphate deposit with an underground mining operation in
development; and
P
4
processing plant
This report has been prepared for inclusion in the offer document (the Offer Document) of AsiaPhos
Limited (AsiaPhos) in connection with the listing of the shares of AsiaPhos on the Catalist Board of
Singapore Exchange Securities Trading Limited (the SGX-ST).
B. BASIS OF VALUE
Our valuation was carried out on a Fair Market Value basis. Fair Market Value is dened as the amount
of money (or the cash equivalent of some other consideration) determined by the Expert in accordance
with the provisions of the VALMIN Code for which the Mineral or Petroleum Asset or Security should
change hands on the Valuation Date in an open and unrestricted market between a willing buyer and a
willing seller in an arms length transaction, with each party acting knowledgeably, prudently and without
compulsion.
C. BASIS OF OPINION
We have conducted our valuation in accordance with the Code for the Technical Assessment and
Valuation of Mineral and Petroleum Assets and Securities for Independent Expert Reports 2005 Edition
(the VALMIN Code), prepared by the VALMIN Committee, a joint committee of the Australasian Institute
of Mining and Metallurgy, the Australian Institute of Geoscientists and the Mineral Industry Consultants
Association with the participation of the Australian Securities and Investment Commission, the Australian
Stock Exchange Limited, the Minerals Council of Australia, the Securities Association of Australia and
representatives from the Australian nance sector.
In order to form an opinion on the Fair Market Value of the Project, it is vital to make assumptions of
certain future events, e.g. economic and market factors. We have taken all reasonable care in examining
those assumptions made to ensure that they are appropriate to the case. These assumptions are based
on the technical knowledge and experience of the Company, AsiaPhos and Norwest Chemicals. The
valuation procedures employed include the review of physical and economic conditions of the Project,
and an assessment of the key assumptions, estimates, and representations made by the proprietor or the
operator of the Project. All matters essential to the proper understanding of the valuation will be disclosed
in the valuation report.
The following factors form an integral part of our basis of opinion:
Assumptions on the market conditions and the subject assets that are considered to be fair and
reasonable;
Financial performance that shows a consistent trend of the operation;
Consideration and analysis on the micro and macro economy affecting the subject assets;
K-7
Analysis on tactical planning, management and synergy of the subject assets; and
Analytical review of the subject assets
We planned and performed our valuation so as to obtain all the information that we considered necessary
in order to provide us with sufcient evidence to express our opinion on the subject assets.
D. STATEMENT OF COMPETENCE
This report is prepared by Johannes Erasmus and Simon Chan. Johannes has extensive experience in
exploration, mining and due diligence assessment of mining projects and has completed a number of
mining project valuations. Johannes is considered a competent person, under the terms of the VALMIN
Code, to carry out this valuation and is a Professional Geoscientist (P.Geo.) of British Columbia, Canada.
Simon has extensive work experience in valuation and corporate advisory industries. He has extensive
valuation experience in mineral assets, mining rights and corresponding project investments. He has
provided a wide range of valuations services to numerous listing companies in Mainland China, Hong
Kong, Singapore and the United States.
E. SOURCES OF INFORMATION
In conducting our valuation of the Fair Market Value of the Project, we have reviewed information from
several sources, including, but not limited to:
Information on the Project including, but not limited to, presentations, prepared documentation,
exploration data, mine planning, legal, marketing and nancial data;
2013 Mianzhu Norwest Business Plan
The ITR dated 28 February 2013;
A site visit;
Interviews of management and employees of the Company, AsiaPhos and Norwest Chemicals; and
Prior industry knowledge and continuing industry research.
Paper-based and digital data was also provided to us, which covered the exploration program,
laboratory analysis of borehole samples, geology, mine operational planning and procedures, nancial
budgets including forecast sales and revenue, operating and capital expenditure, expenses and income,
marketing, tenure, land purchase and ownership, environmental management planning, legal and
regulatory matters. We reviewed the nancial model provided by Norwest Chemicals and believe that
it is consistent with industry practice in terms of methodology and completeness. We also believe that,
within the normal constraints of nancial modeling of future events, the assumptions have properly been
considered as to forecast operational performance, revenues and costs are reasonable. All requests
to Norwest Chemicals for information and clarication were answered to our satisfaction and within a
reasonable time. The staff members of the Company, AsiaPhos and Norwest Chemicals were made
available for interviews as requested and were cooperative and forthcoming. We have no reason to
believe that the information provided to us is inaccurate or incomplete.
F. INDEPENDENT TECHNICAL REPORT
We have been provided with a report produced by Watts, Grifs and McOuat Limited (WGM) titled
A Technical Review of the Cheng Qiang Yan Phosphate Deposit and Shi Sun Xi Phosphate Deposit,
Mianzhu City, Sichuan Province, Peoples Republic of China for Asiaphos Limited (the ITR) dated 28
February 2013. We received the report on 20 June 2013.
We regard the report as being very thorough and complete, and accept the estimation of the resources.
We note further that the bulk of the operating and other cost estimates are based on the experience of
Mianzhu Norwest over the last several years of operating as a mining company, and we think that the
cost and capital expenditure forecasts are sound.
K-8
The ITR also presents a very good review of the mine and operational plans. Based on our own
observations of the Project and our review of the relevant documentation and discussions with the
engineering and operational staff, we agree with WGM that the mine and operational plans appear
reasonable and complete.
G. SITE INSPECTION
We conducted site visits in December 2011 and November 2012. We are satised that Mianzhu Norwest
has demonstrated that it has the experience, knowledge, staff and equipment to operate underground
mines.
H. VALUATION APPROACH
We have used the discounted cash ow method of the income approach in this exercise. It is an
estimation of the NPV of the forecast free cash ow produced by the Project since the Valuation Date.
In keeping with the requirements of the VALMIN Code a range of values, and a preferred value, have
been calculated for the project.
We have assumed the value of the Project to be an economic transaction value for an arms length
transaction that is not conducted under duress (i.e. it is negotiated over time rather than being a re sale
requiring rapid closure).
By agreement with the client the effective date of the valuation is 31 March 2013. No material changes
have been brought to our attention since that date.
This report is in compliance with the VALMIN Code. The fundamental objective of the VALMIN Code is
the protection of investors. With this objective in mind we have conducted the valuation in the following
way:
where there has been a choice of a simple and a complex method of estimating a nancial factor
and there is no material difference between the methods in the resulting accuracy of, or condence
about, the factor amount, the simple method has been used; and
where there is a material uncertainty regarding the quantum of an amount or parameter, we have
been as conservative as possible to be consistent with our intent to provide a reasonable estimate
of the fair market value of the project.
Income Approach
It is generally accepted that, where exploration has advanced to the stage where there is a dened
project advanced at least to resource denition and a feasible mining method, the best approach
to valuation is usually to estimate the net present value of the project an approach known as the
Discounted Cash Flow (DCF) method.
We make the following observations on the efcacy of the NPV valuation method:
it is necessarily based on many assumptions including future operating performance, revenue
and costs and the reader must remember that it is intended as a guide and not to give an exact
number;
it is quite sensitive to changes in the discount rate which is itself an estimation;
many of the calculations in the nancial model were made on the determination of free cash ow,
derived from accounting income which is on an accrual basis;
it assumes constant risk over the life time of the project; and
it does not allow for managements ability to change the cost structure or scale of the project in
response to changed operating or market conditions.
K-9
I. ASSUMPTIONS
We have neither conducted a full legal audit of the status of the various tenements nor formally
reviewed all material factors affecting the tenements. Preliminary checks have not identied any
evidence of any issues with the concession, which appears to be in good standing with current,
valid licenses and approvals and with no identied outstanding commitments as at the Valuation
Date. King & Wood Mallesons, a law rm practicing in the PRC which acts as legal advisers to the
Company, has conducted a legal due diligence review on Mianzhu Norwest in connection with the
mining project and has conrmed that the licenses mentioned in Part M. Tenement and Tenure
of this report are legally valid and enforceable. The valuation below assumes that the tenure is in
good standing.
In order to realize the growth potential of the business and maintain a competitive edge, additional
manpower, equipment and facilities are necessary to be employed. For the valuation exercise, we
have assumed that all proposed facilities and systems will work properly and will be sufcient for
future expansion.
We have assumed all the information provided to us to be reliable and legitimate. We have relied to
a considerable extent on such information in arriving at our opinion of value.
We have assumed that there will be no material change in the existing political, legal,
technological, scal or economic condition which may adversely affect the business of the
Company.
Operational and contractual terms bound by the contracts and agreements entered into by the
Company will be honored.
Its competitive advantages and disadvantages will not change signicantly during the period under
consideration.
J. PROJECT BACKGROUND
The two phosphate deposits controlled by Mianzhu Norwest: Cheng Qiang Yan and Shi Sun Xi are
located in west-central Sichuan Province, PRC. Mianzhu Norwest has controlled these properties under
various stages of licensure since 2002. Until the 12 May 2008 earthquake (Richter magnitude 8.0),
Cheng Qiang Yan was producing phosphate ore at about 90,000 tpa and Shi Sun Xi commenced
production in April 2008. Cheng Qiang Yan resumed production in November 2010 and Shi Sun Xi
resumed production in May 2012. Both the Mianzhu Norwest properties and their neighboring mines
producing phosphate ore suffered severe damage to the infrastructure and haulage roads and caused
the cessation of all phosphate production in the immediate area in May 2008. Restoration of previous
production levels is still in progress and major reconstruction work on the haulage route from the mines to
Mianzhu City is in progress.
The restoration of production suffered another major setback with a landslide in August 2010 that
suspended operations for 3 months. As WGM believes that this risk is still present, Mianzhu Norwest
must work diligently with the government and the neighboring operations in reconstruction of the haulage
roads. Both mine truck loading areas are located in areas where rock falls can occur and Mianzhu
Norwest needs to work towards relocation of these operations or removal of the risk of rock slides and
the risk to people required to work in the areas. At the time of last visit in November 2012 screening
operations were in progress.
A new processing plant has been constructed approximately 2 km from the site of the original facility that
was damaged in the earthquake. The new plant construction consists of a fully integrated operation on
one site with crushing, screening, drying and rock storage facilities and two new P
4
electric arc furnaces.
K-10
K. LOCATION AND ACCESS
The immediate area of Mianzhu Norwests two phosphate deposits is located in the district of Mianzhu
City, An Xian County near the regional junction of virgin forests in the alpine zone. The topography
is extremely rugged with steep mountains and valleys or canyons, with vegetation cover. This area is
strongly divided by topographic features which affect the local micro-climates in any given area. The
overall trend of the mountains and major valleys generally is northeast to southwest. The elevations of
the two phosphate deposits range from 3,200 m to about 1,800 m. Each of the properties, Cheng Qiang
Yan and Shi Sun Xi, is dened by existing mining and exploration permits (one each) with surveyed
coordinates.
The existing mining permit for Cheng Qiang Yan is about 1.53 km wide E-W and 1.10 km long N-S. The
2
. Topographic
elevations range from 2240 m to 2570 m. There is a single phosphate bed present on the property
which averages about 5.0 m in thickness with an average grade of about 28.7% P
2
O
5
. The bed strikes
generally WNW-ESE and dips, generally, 45 to 55 to the NNE. Several minor normal faults have been
encountered at various elevations in the past mining operations. Mianzhu Norwest currently has an
exploration license, for increased mining depth, within the area already licensed for mining.
The existing mining permit for Shi Sun Xi is about 0.76 km wide E-W and 2.74 km long N-S. The
2
. Topographic
elevations range from 2420 m to 1600 m. There is a single phosphate bed present on the property which
averages about 7.4 m in thickness with an average grade of about 29.6% P
2
O
5
. The phosphate bed
strikes generally about WSW-ENE and dips about 30 to the NNW. Mianzhu Norwest currently has an
exploration license to the east of the area, and nearly contiguous to the area already licensed for mining.
There is one minable phosphate bed in Mianzhu Norwests area of interest and it occurs on both
properties being described here although existing property reports use two identications. Sichuan
Institute of Chemical Engineering and Geological Exploration has placed this phosphate bed in the
Devonian Period of the geologic time scale and given the bed a specic deposit type. The deposit
type is known as the Shi Fang type. As explained to WGM, the phosphate bed is actually from the
Lower Cambrian Period and originally was deposited as the Meishucun Formation as were most other
phosphate beds on other parts of the Mianzhu anticline area. There was a depositional hiatus from the
Lower Cambrian Period to the Devonian Period at which time this phosphate bed, in preference to others
in the area was severely weathered which created some internal structural changes and enrichment in
P
2
O
5
2
O
5
correctly assigned to the Lower Cambrian.
Mianzhu Norwests mining operations and phosphate properties are located about 45 km northwest
(straight-line about 330) of downtown Mianzhu City under the jurisdiction of Qing Ping Town, Mianzhu
City, Sichuan Province, Peoples Republic of China.
During WGMs initial site visit to this project, during the period from 23 February 2010 to 3 March
2010, practically the entire length of the access road from Mianzhu Norwests plant site to Mianzhu
Norwests phosphate deposits was under reconstruction to repair the damages caused by the 12 May
2008, 8.0-magnitude earthquake and strong aftershocks. The Peoples Liberation Army (PLA) was in
charge of the rough work (pioneering) in this reconstruction process and individual contractors were
completing the nal grading and reconstruction efforts. After the 2010 site visit by WGM, the mine access
road was blocked by a major rock slide that suspended phosphate ore haulage down the valley from
August 2010 to May 2011. At the time of the site visit in 2011 by WGM, the haulage road down the valley
had been restored to basic access with major reconstruction still taking place. Many parts of the road
were substandard presenting barely passable conditions with continuing hazards from rock slides and
substandard conditions.
K-11
The PLA had a major realignment of the valley road under construction with the expected completion
in 2015. At the time of the site visit in 2011 by WGM, the PLA had completed a major rework of the
river channel above and below the town of Qing Ping. In 2010, access to the Cheng Qiang Yan property
required 4-wheel drive vehicles and access road to the Shi Sun Xi property was not passable due to
a major rock slide in the immediate area of the mine development activity at that time. Access to the
Shi Sun Xi deposit to restart development of the mine was gained in May 2011. At the time of the site
visit on 31 May 2012, the rehabilitation of the road from Hanwang Town to Qing Ping Town was nearing
completion, the entire length was paved and widened, and only the construction of one tunnel and a
water diversion installation remained to be completed.
Prior to the Wenchuan Earthquake, the Deyang-Hanwang rail line (762 mm rail gage) was operational,
providing the possibility of rail-freighting phosphate rock and phosphate-derived manufactured products
to distant locations. The current condition of this line, or its operation, is reportedly resumed although the
rail station and rail yards in Hanwang Town were destroyed in the Wenchuan Earthquake.
A major part of the haulage road is the Mian-Mao Highway that connects Mianzhu City, Hanwang Town
and Qing Ping Town through to Mao County. The route design is for a two lane highway with some
areas of double lane width varying from 7 m to 14 m. At the time of the site visit on 31 May 2012 by
WGM, the rehabilitation of the road from Hanwang Town to Qing Ping Town was nearing completion,
the entire length was paved and widened, and only the construction of one tunnel and a water diversion
installation remained to be completed. The remaining road access to Mianzhu Norwests Mines will be the
responsibility of Mianzhu Norwest and its two neighboring phosphate mine operators. The reconstruction
of this section of the road is the responsibility of the Sichuan provincial government but is not scheduled
for completion until 2015/2016 and works has already commenced in early 2013. The design, based on a
government press release in May 2012, includes elevation of some sections of the road and excavation of
tunnels in other areas to reduce areas that can be subject to ooding and landslides. The completion of
the Mian-Mao Highway will allow the Mines to sustain their production in the future.
L. GEOLOGICAL SETTING
The outcrops in the area of Mianzhu Norwest's phosphate properties, Cheng Qiang Yan and Shi Sun Xi,
include Upper Sinian strata, Upper Devonian strata, Lower Carboniferous strata, Lower Permian strata
and small amount of Quaternary system. In general, the geologic structures strike NE to SW and dip to
North and Northwest at 42-58.
This region is located in the middle part of the discordogenic faults at Longmen Shan Thrust Belt and
earthquakes frequently occur with some in the strong to severe categories. Most of the stronger historical
shocks in Sichuan Province were almost all located in the west of 104E longitude, and this phosphate-
containing region lies right on this 104E longitude line. This line is also generally located in the belt
where the thickness of the earths crust is rapidly changing. The Longmen Shan area marks the (rapid)
transition from thick (60 km+) crust beneath the Tibetan Plateau (to the west) to continental crust with
normal thickness (around 40 km) beneath the Sichuan Basin. This area is also the boundary point
between Caledonian-age folding (Silurian Period) and Songpan-Ganzi geosynclines fold belt of Indosinian
orogeny of the early Mesozoic Era (Late Triassic Period).
The area in which the Mianzhu Norwests Mines, Cheng Qiang Yan and Shi Sun Xi, are both located, is
very near the juncture of the Yangtzi meta-platform, the Longmen Shan - Da Ba Shan platform marginal
depression, the fold belt of Longmen Shan, and the north-west wing of a large double-plunging anticline.
Geologically, this area of Sichuan Province has been in the process of deformation for at least the last
600 million years.
K-12
M. TENEMENT AND TENURE
For the Cheng Qiang Yan mine, a new mining license was issued to Mianzhu Norwest on 9 March 2011.
The new license uses the same corner points as the old one and is in force until December 2015 with an
approved production rate of 50 kt/a. The permit encompasses an area of 1.6491 km
2
. The mineable depth
approved with the new permit is between 2,570 m and 2,240 m of elevation. The mining permit license
number is C5100002011036120107965.
For the Cheng Qiang Yan property, the current exploration permit was issued on 22 March 2012 and
remains valid until 9 April 2014. The area encompassed by the exploration permit is 0.55 km
2
. The
exploration permit license number is T51520080403010704.
For the Shi Sun Xi mine the mining license was renewed by The Land and Resources Department of
Sichuan Province in November 2005. The license number was 5100000530733 and was valid from
December 2005 until December 2015, with the approved production capacity at 100 kt/a. On 22 March
2011, a new mining license was issued for this property to Mianzhu Norwest. The new license uses the
same corner points as the old and is in force until 9 January 2020 with an approved production rate of
200 kt/a. The area encompassed by the mining license is 2.0237 km
2
. The mineable depth approved
with the new permit is between 2,420 m and 1,600 m of elevation. The mining permit license number is
C5100002010016120054374.
For the Shi Sun Xi property, the current exploration permit was issued on 22 March 2012 and remains
valid until 16 June 2014. The area encompassed by the exploration permit is 1.28 km
2
. The exploration
permit license number is T51520080603010707.
King & Wood Mallesons, a law rm practising in the PRC which acts as legal advisers to the Company,
has conducted a legal due diligence review on Mianzhu Norwest in connection with the mining project
and has conrmed that the above mentioned licenses are legally valid and enforceable.
N. ENCUMBRANCES
We questioned the directors of Mianzhu Norwest about the existence of any encumbrances on the
Project that were not in the public domain. We have no reason to believe that we have not been provided
with all relevant information that might be reasonably considered to inuence the economic value of the
Project.
O. EXISTING EXPLORATION AND OPERATIONAL READINESS
Phosphate exploration in this area began in 1968 and continued through the 1990s with initial regional
programs and eventually culminating is site-specic property reports by various PRC governmental
ministries.
In 2002, operations of the Cheng Qiang Yan property were acquired by Mianzhu Norwest. From 2002
until the 12 May 2008 earthquake, the Cheng Qiang Yan Phosphate mine produced and shipped 379,185
tonnes of phosphate ore.
At Shi Sun Xi, in 1992, crews (afliation unknown) constructed a mining adit at the upper part of the
deposit. However, the operation was closed in 2000 due to consistent poor production and unsatisfactory
prot caused by a bad adit location and design.
In the period of 1990 to 2000, an organization, probably the Sichuan Institute of Chemical Engineering
and Geological Exploitation completed the trench excavations, geological descriptions, and phosphate
sampling from the trenches on the Shi Sun Xi property and neighboring plots of ground.
Before foreign investment was introduced (Sichuan Mianzhu Norwest Phosphate Chemical Co., Ltd.), two
mining adits were constructed at elevations 1,841 m and 1,872 m near the lower part of the deposit in
2001 and 2002, but they were abandoned because ore was not encountered at the expected locations.
In 2002, the property was acquired by Mianzhu Norwest.
K-13
In 2005, an organization, probably the Sichuan Institute of Chemical Engineering and Geological
Exploitation, completed the drilling of three holes, the geological logging of the core and sampled the drill
core on the Shi Sun Xi property within the mining license area.
In 2005, hoping to develop the local economy, following the increase in resources and based on larger
capacity and better prot margins, Mianzhu Norwest contracted the Coal Design & Research Institute of
Sichuan Province to design a production expansion from 100 kt/a to 200kt/a.
P. MAJOR VALUATION ASSUMPTIONS
We have reviewed the data provided on the Mines and the P
4
plant by the Company and the ITR report
and based on our professional view, made necessary adjustments to certain of the assumptions (such
as revenue, selling price, costs, capital expenditure and working capital). We regard the ITR as being
very thorough and complete. We had conducted our own review of the relevant documents and held
discussions with the engineering and operational staff of the Group and based on our own observations
of the Project, agreed with WGM that the mine and operational plans appear reasonable and complete
and therefore accepted the estimation on the mine production schedule made by WGM. Our valuation
was arrived at based on the major assumptions as stated in this section. In view of the above, any
differences in assumptions and gure between the ITR and the Valuation Report could be due to
professional differences in the adjustments to certain data provided by the Company by two different and
independent Qualied Persons. For example, in the ITR, the Qualied Person has included the production
of SHMP and STPP in the nancial forecast, resulting in a reduction of P
4
sales as some of the P
4
is
used in the production of SHMP and STPP. Whereas in the Valuation Report, the Qualied Person did
not include the production of SHMP and STPP in the valuation assumptions, resulting in higher P
4
sales
as the P
4
need not be kept for use in the production of SHMP and STPP. The valuation result as at the
Valuation Date is based on the following assumptions:
Mine Production Schedule
Volume (Tonne) 31 Mar to 31 Dec 2013 2014 2015 2016
Phosphorous rock mined 104,323 264,200 415,000 520,000

Volume (Tonne) 2017 2018 2019 2020
Phosphorous rock mined 630,000 800,000 1,000,000 1,000,000

Volume (Tonne) 2021 2022 2023 2024
Phosphorous rock mined 1,000,000 1,000,000 1,000,000 1,000,000

Volume (Tonne) 2025 2026 2027 2028

Volume (Tonne) 2029 2030 2031 2032

Volume (Tonne) 2029 2030 2031 2032

Source: ITR
Per discussed with Management, the Companys mining capacity is expected to increase gradually to 1.0
million tonne per annum over a four year period following the scheduled completion of the construction of
the Mian-Mao Highway in 2015.
K-14
Sales Volume
Volume (Tonne) 31 Mar to 31 Dec 2013 2014 2015 2016
Phosphorous rock for direct sales 32,323 183,200 329,950 430,698
P4 8,000 9,000 9,450 9,923
P4 - By product (slag) 88,000 99,000 103,950 109,148
P4 - By product (sludge) 800 900 945 992
P4 - By product (ferrophosphate) 800 900 945 992

Volume (Tonne) 2017 2018 2019 2020
P4 10,419 10,940 11,487 12,061
P4 - By product (slag) 114,605 120,335 126,352 132,669
P4 - By product (sludge) 1,042 1,094 1,149 1,206
P4 - By product (ferrophosphate) 1,042 1,094 1,149 1,206

Volume (Tonne) 2021 2022 2023 2024
P4 12,664 13,297 13,962 14,660
P4 - By product (slag) 139,303 146,268 153,581 161,261

Volume (Tonne) 2025 2026 2027 2028
P4 15,393 16,163 18,000 18,000
P4 - By product (slag) 169,324 177,790 198,000 198,000

Volume (Tonne) 2029 2030 2031 2032
P4 18,000 18,000 18,000 18,000
P4 - By product (slag) 198,000 198,000 198,000 198,000

Source: 2013 Mianzhu Norwest Company Business Plan and as amended by JLL
Per discussed with Management, the production factors of the P
4
by products are 11, 0.1 and 0.1 for
Slag, Sludge and Ferrophosphate respectively.
K-15
Sales Price
Price (RMB/tonne) 31 Mar to 31 Dec 2013 2014 2015 2016
Phosphorous rock 490 520 546 573
P4 14,500 15,225 15,986 16,786
P4 - By product (slag) 30 32 34 36

Price (RMB/tonne) 2017 2018 2019 2020
P4 17,625 18,506 19,431 20,403

Price (RMB/tonne) 2021 2022 2023 2024
P4 21,423 22,494 23,619 24,800

Price (RMB/tonne) 2025 2026 2027 2028
Phosphorous rock 889 934 981 1,030
P4 26,040 27,342 28,709 30,144

Price (RMB/tonne) 2029 2030 2031 2032
Phosphorous rock 1,081 1,135 1,192 1,251
P4 31,652 33,234 34,896 36,641
Per discussed with Management, the annual growth of sales prices of phosphorous rock and
its derivatives are expected to grow at a rate of 5% per annum through to 2030. Sales price of P
4
is
determined mostly by the balance of supply demand and costs than premiums that can be attributed to
the form or functionality of the product. Therefore, prices have tended to reect changes in the phosphate
rock market.
K-16
Revenue
Revenue (RMB'000) 31 Mar to 31 Dec 2013 2014 2015 2016
P4 116,000 137,025 151,070 166,555
P4 - By product (slag) 2,640 3,168 3,534 3,929
P4 - By product (sludge) 800 945 1,042 1,149
P4 - By product (ferrophosphate) 800 945 1,042 1,149
Total 136,078 237,347 336,841 419,701

Revenue (RMB'000) 2017 2018 2019 2020
P4 183,626 202,448 223,199 246,077
P4 - By product (slag) 4,355 4,814 5,308 5,838
Total 513,308 653,476 826,644 876,519

Revenue (RMB'000) 2021 2022 2023 2024
P4 271,300 299,108 329,767 363,568
P4 - By product (slag) 6,408 7,021 7,678 8,547
Total 929,749 986,591 1,047,321 1,112,403

Revenue (RMB'000) 2025 2026 2027 2028
P4 400,834 441,919 516,762 542,600
P4 - By product (slag) 9,481 10,489 12,275 12,869
Total 1,182,015 1,256,516 1,357,863 1,425,736

Revenue (RMB'000) 2029 2030 2031 2032
Phosphorous rock 905,913 951,209 998,769 1,048,708
P4 569,730 598,217 628,128 659,534
P4 - By product (slag) 13,465 14,058 14,850 15,642
Total 1,496,974 1,571,742 1,650,419 1,732,988

Per discussed with Management, the Companys key revenue contributions come from the sales of
phosphorus rock and P
4
. Annual sales are derived from the forecasted sales volumes of phosphorous
rock and P
4
multiplied by their respective sales prices. Phosphorous rock is a raw material in the
manufacturing process of P
4
, therefore the total mining output of phosphorous rock available for sale
is inversely proportional to the projected sales volume of P
4
. According to Management, P
4
has
a conversion factor of 9.0 which refers to the amount of phosphorous rock (in tonnes) needed for the
production of a tonne of P
4
.
K-17
Cost of Sales
Cost of sales (RMB'000) 31 Mar to 31 Dec 2013 2014 2015 2016
P4 97,968 122,140 137,491 152,089
Total 106,317 170,870 229,601 277,304

Cost of sales (RMB'000) 2017 2018 2019 2020
P4 167,606 183,398 200,410 219,949
Total 332,384 403,327 486,380 518,437

Cost of sales (RMB'000) 2021 2022 2023 2024
P4 241,186 264,272 289,352 318,526
Total 552,560 588,941 627,610 670,641

Cost of sales (RMB'000) 2025 2026 2027 2028
P4 343,663 371,443 432,358 452,827
Total 710,126 752,701 824,437 864,050

Cost of sales (RMB'000) 2029 2030 2031 2032
P4 476,375 500,530 525,308 550,733
Total 907,664 953,011 1,000,091 1,048,943

Per discussed with Management, the Companys cost of sales is mainly associated with the direct mining
costs of phosphorous rock and the manufacturing costs of P
4
. The major cost components relating to
phosphorous rock include subcontract labor costs, transportation costs and production costs. The major
cost components relating to P
4
include raw materials costs, labor costs and production costs. Cost of
sales for both phosphorous rock and P
4
are directly proportional to their respective projected sales
volumes. Subcontractor labor cost per tonne for phosphorous rock in 2013 and 2014 is projected to be
RMB86. Transportation cost per tonne for phosphorous rock in 2013 and 2014 is projected to be RMB50.
Production cost per tonne for phosphorous rock in 2013 and 2014 is estimated to be RMB30. All three
major costs of sales components for phosphorous rock are estimated to grow at an annual rate of 5%
per discussed with Management. Raw materials cost per tonne for P
4
in 2013 and 2014 is estimated
to be RMB5,860 and RMB6,016 respectively. The cost of each individual raw material required for the
production of P
4
which includes phosphorous rock, coal, coke, silica dioxide, electrodes and water is
estimated to grow at an annual rate of 5% per discussed with Management. The amount of electricity
required per tonne of P
4
production is 13,200 Megawatts per annum and is assumed to remain constant
throughout the forecast period. The cost of variable electricity per tonne of P
4
production is estimated to
be RMB 39 cents and RMB 46 cents in 2013 and 2014 respectively.
K-18
Selling Expense
Selling expense (RMB'000) 31 Mar to 31 Dec 2013 2014 2015 2016
Phosphorous Rock and P4
2,625 4,900 5,801 6,091

Selling expense (RMB'000) 2017 2018 2019 2020
6,396 6,716 7,052 7,404

7,774 8,163 8,571 9,000

9,450 9,922 10,419 10,939

11,486 12,061 12,664 13,297

Per discussed with Management, selling expenses are projected to grow at an annual rate of 5%,
exhibiting a positive linear relationship with sales revenue. The key component of selling and distribution
expense is transportation costs. Projections for selling expenses relating to phosphorous rock and P
4
are
performed on a consolidated basis as these costs are amalgamated for the two products.
General and Administrative Expense
RMB'000 31 Mar to 31 Dec 2013 2014 2015 2016
Phosphorous Rock and P4 3,954 5,891 6,167 6,476

RMB'000 2017 2018 2019 2020

RMB'000 2021 2022 2023 2024

RMB'000 2025 2026 2027 2028

RMB'000 2029 2030 2031 2032

Per discussed with Management, the major components of general and administrative expense relate to
staff salary and incentives and insurance costs. General and administrative expense is projected to grow
at an annual rate of 5%, exhibiting a positive linear relationship with sales revenue. Projections for general
and administrative expenses relating to phosphorous rock and P
4
are performed on a consolidated basis
as these costs are amalgamated for the two products.
K-19
Depreciation and Amortisation Expense
Depreciation and Amortisation
Expense (RMB'000)
31 Mar to 31 Dec 2013 2014 2015 2016
Phosphorous Rock 902 2,167 3,260 3,640
P4 3,000 6,931 9,165 9,556
Total 3,902 9,098 12,424 13,195

Expense (RMB'000)
2017 2018 2019 2020
Phosphorous Rock 4,157 4,042 4,488 4,878
P4 9,966 10,397 10,850 11,325
Total 14,123 14,439 15,338 16,203

Expense (RMB'000)
2021 2022 2023 2024
P4 11,824 12,348 12,898 7,178
Total 16,992 17,776 18,413 12,525

Expense (RMB'000)
2025 2026 2027 2028
P4 1,345 1,345 1,345 1,345
Total 6,570 6,455 6,253 6,045

Expense (RMB'000)
2029 2030 2031 2032
P4 1,345 1,345 1,345 1,233
Total 5,845 5,745 5,745 5,633

Per discussed with Management, depreciation expense attributed to phosphorous rock mainly pertains
to mine wells construction and haulage & other equipment which both carry the same depreciable life of
10 years. Depreciation expense relating to P
4
mainly pertains to civil works and plant & machinery which
carry depreciable lives of 20 years and 12 years respectively. Amortisation expense pertains to mining
rights held by Mianzhu Norwest. The mining rights are projected to be fully amortised by 2018.
Corporate Income Tax
The corporate tax rate applicable to the Company in China is assumed to remain at the prevailing rate of
25%.
K-20
Change in Working Capital
(RMB'000)
31 Mar to 31 Dec 2013 2014 2015 2016
Change in working capital 13,941 2,246 1,635 1,860

(RMB'000)
2017 2018 2019 2020

(RMB'000)
2021 2022 2023 2024

(RMB'000)
2025 2026 2027 2028

(RMB'000)
2029 2030 2031 2032
Change in working capital 3,252 3,415 3,585 (75,474)

Per discussion with Management, the Companys working capital consists of trade receivables, inventory
and trade payables. Trade receivable is calculated based on the assumption that the Company has a
Day Sales Outstanding (average number of days to collect revenue after a sale has been made) of 0
days and 45 days for phosphorous rock and P
4
respectively. Inventory for both phosphorous rock and P
4

is calculated based on the assumption that the Company has a Days Inventory Outstanding (average
number of days to turn inventory into sales) of 30 days. Trade payable for both phosphorous rock and
P
4
is calculated based on the assumption that the Company has a Days Payable Outstanding (average
number of days to pay its trade creditors) of 30 days.
Capital Expenditure
Capital Expenditure (RMB'000) 31 Mar to 31 Dec 2013 2014 2015
Construction of furnace 32,207 0 0
Mine well construction 2,300 2,000 1,500
Haulage system and other equipment 1,000 5,700 900
Road access & repairs 600 500 500
Well safety design 3,000 0 0
Conversion of exploration rights to mining rights 0 20,000 0
Conversion of resource to reserve 0 7,000 0
Total Capital Expenditure for Phosphorous Rock and P4 39,107 35,200 2,900

Capital Expenditure (RMB'000) 2016 2017 2018
Construction of furnace 0 0 0
Mine well construction 2,500 2,000 2,000
Haulage system and other equipment 2,100 3,200 2,900
Well safety design 0 0 0
Conversion of exploration rights to mining rights 0 0 0
Conversion of resource to reserve 0 0 0

K-21
Mine well construction 2,000 0 0
Mine well construction 0 0 0



Capital Expenditure (RMB'000) 2031 2032
Construction of furnace 0 0
Mine well construction 0 0
Haulage system and other equipment 2,900 2,900
Road access & repairs 0 0
Well safety design 0 0
Conversion of exploration rights to mining rights 0 0
Conversion of resource to reserve 0 0
Total Capital Expenditure for Phosphorous Rock and P4 2,900 2,900

Per discussed with management, the Company would incur signicant capital expenditure in year 2013
through 2014. The capital expenditure in these two years can be attributed to the construction of a P
4

furnace in 2013 and the conversion of exploration rights to mining rights in 2014. The estimated capital
expenditure for the conversion of exploration rights to mining rights pertains to the conversion of Shi
Sun Xis current exploration right permit license (T51520080603010707) to a mining license prior to its
K-22
expiration date. Production capacity of phosphorous rock is expected to build up in cadence with the mine
well construction expenditure from 2013 through to 2019. Production is expected to be ramped up to a
maximum capacity of 1 million tonnes per year gradually from 2015 which is the targeted completion date
of the construction of the Mian-Mao Highway.
Q. DISCOUNTED CASH FLOW VALUATION
The free cash ow model has been applied in this valuation to calculate the NPV of the Project.
A NPV scenario analysis was performed using several values for phosphorous rock price, P
4
price,
discount rate and production costs. The base case is where:
the phosphorous rock price is RMB 490 per tonne;
the P
4
price is RMB 14,500 per tonne;
the annual production costs are as estimated by the Company; and
the annual discount rate is 14.00%

Table 1 NPV in RMB billions Scenario Analysis, varying price per tonne and the discount rate while
using base case production costs
RMB/tonne Discount Rate
Year 1
(Phosphorous Rock)
Year 1
(P
4
)
- 2% - 1% base case + 1% + 2%
- 10% - 10% 1.1 1.0 0.9 0.8 0.8
- 5% - 5% 1.3 1.2 1.1 1.0 0.9
base case base case 1.5 1.4 1.3 1.2 1.1
+ 5% + 5% 1.7 1.6 1.4 1.3 1.2
+ 10% + 10% 1.9 1.8 1.6 1.5 1.4
Table 2 NPV in RMB billions Scenario Analysis, varying price per tonne and production costs while
using base case discount rate
RMB/tonne Production Costs
Year 1
(Phosphorous Rock)
Year 1
(P
4
)
- 10% - 5% base case + 5% + 10%
- 10% - 10% 1.1 1.0 0.9 0.8 0.7
- 5% - 5% 1.3 1.2 1.1 1.0 0.9
base case base case 1.5 1.4 1.3 1.1 1.0
+ 5% + 5% 1.7 1.6 1.4 1.3 1.2
+ 10% + 10% 1.8 1.7 1.6 1.5 1.4
Table 3 NPV in RMB billions Scenario Analysis, varying discount rate and production costs while using
base case price per tonne
Discount Rate
Production Costs
- 10% - 5% base case + 5% + 10%
- 2% 1.8 1.6 1.5 1.4 1.2
- 1% 1.6 1.5 1.4 1.3 1.1
base case 1.5 1.4 1.3 1.1 1.0
+ 1% 1.4 1.3 1.2 1.1 1.0
+ 2% 1.3 1.2 1.1 1.0 0.9
K-23
The cells of Tables 1, 2 and 3 that are shaded light grey contain the range of values that JLL believes are
the most likely to contain a fair market value for the project. The reader is cautioned to remember that it is
not possible to forecast future performance of the project or other economic factors with certainty and that
it is prudent to consider a sufcient range of variation in the relevant factors. The cells of Tables 1, 2 and
3 that are shaded dark grey are included to assist the reader in drawing their own conclusion as to the
value of the project.
A sensitivity analysis on key parameters to the valuation is performed for readers to appreciate the
potential impact that changes in these variables would have on the value of the Mining Project when
considered separately. Sensitivity analysis on potential grade variations of the phosphorous rock mined is
captured in the sensitivity analysis of the rocks selling price. This is due to the direct relationship between
grade and selling price of the phosphorous rock whereby lower grade rocks would result in a lower selling
price and vice versa.
Table 4 NPV in RMB billions Sensitivity Analysis, holding other parameters constant
Parameters Unit Step
Decreased
by 2 steps
Decreased
by 1 step
Base case
Increased
by 1 step
Increased
by 2 steps
Phosphorous Rock / P
4
(price per tonne)
+/- 5% 0.9 1.1 1.3 1.4 1.6
Production costs +/- 5% 1.5 1.4 1.3 1.1 1.0
Discount rate +/- 1% 1.5 1.4 1.3 1.2 1.1
R. RISKS
In Section 24 of the ITR includes a comprehensive review of the project risks and we agree with the
conclusions of WGM in regard to those risks. We include some additional commentary on general risk
factors for the sake of prudence.
Concession risk
As mentioned earlier in this report we believe that Mianzhu Norwest has demonstrated that they have all
necessary permits and licenses in place and up to date.
Major risk, unlikely to occur.
Technology/equipment risk
The project relies on low tech, well understood and proven technology and mining practices. The
company and its workforce are very familiar with the equipment and mining methodology.
Moderate risk, unlikely to occur.
Political/country risk
There is little political risk.
Low risk, unlikely to occur.
Industry/regional/global economic weakening
The market seems relatively secure as a large portion of the production is used for fertilizer and with a
growing population that must be fed, there is little risk of the market collapsing.
Moderate risk, could possibly occur, underscores the need for a well-managed business.
Operation risk
Mianzhu Norwest faces the same operational risks as every mining company: bad weather, machinery
failure, wall collapse, rising prices etc. The experience of Mianzhu Norwest in managing a contract mining
business will help them reduce the likely impact of any of these occurrences.
Moderate risk, unlikely to occur.
K-24
Natural disaster risk
For this project the primary risk is a repeat of the earthquake or landslide and that is high risk. In terms
of the landslides the earthquake resulted in large amounts of unconsolidated material on the slopes
of very steep mountains. The recent landslide occurred after an unusually heavy period of rain (see the
following photographs) and much of this unconsolidated material is still evident on the mountain slopes.
Roads are being constructed by cutting into unstable slopes and it would not take much to trigger more
landslides. Even a small landslide may disrupt production.
Major risk, likely to occur.

Figure 1: New road up a collapsed slope

Figure 2: Stabilizing the slope for new road

Figure 3: Valley lled to level of new road
K-25
S. DISCOUNT RATE
In applying the discounted cash ow method, it is necessary to determine an appropriate discount rate
for the assets under review. The discount rate represents an estimate of the rate of return required by a
third party investor for an investment of this type. The rate of return expected from an investment by an
investor relates to perceived risk. Risk factors relevant in our selection of an appropriate discount rate
include:
1. Interest rate risk, which measures variability of returns, caused by changes in the general level of
interest rates.
2. Liquidity risk, which measures the ease with which an instrument can be sold at the prevailing
market price.
3. Market risk, which measures the effects of the general market on the price behavior of securities.
4. Business risk, which measures the uncertainty inherent in projections of operating income.
Consideration of risk, burden of management, degree of liquidity, and other factors affect the rate of
return acceptable to a given investor in a specic investment. An adjustment for risk is an increment
added to a base or safe rate to compensate for the extent of risk believed involved in the investment. The
appropriate discount rate for the valuation exercise is the cost of equity.
Weighted Average Cost of Capital
The appropriate rate of return for valuing the Project is the weighted average cost of capital (WACC)
which is weighted average of the return on equity capital and the return on debt capital. The WACC is
expressed in the following formula:
WACC =
E
*Re +
D
*Rd*(1-Tc)
V V
Where:
Re = Required return on equity
Rd = Required return on debt
E = fair value of the rms equity
D = fair value of the rms debt
V = E + D
E/V = percentage of nancing that is equity
D/V = percentage of nancing that is debt
Tc = corporate tax rate
Cost of Equity
We have used Capital Assets Pricing Model (the CAPM) to estimate the cost of equity. The CAPM is a
fundamental tenet of modern portfolio theory which has been generally accepted basis for marketplace
valuations of equity capital. The CAPM technique is widely accepted in the investment and nancial
analysis communities for the purpose of estimating a companys required return on equity capital.
K-26
The equation of CAPM is shown as follow:
Cost of equity = Risk free rate + (Beta x Risk Premium) + Other risks

The return on equity required of a company represents the total rate of return investors expect to earn,
through a combination of dividends and capital appreciation, as a reward for risk taking. The Capital
Asset Pricing Model (CAPM) is used to calculate the cost of equity by using publicly-traded companies.
Parameters for CAPM
Items Description
Risk Free Rate 1.12%
3.59%
Hong Kong Sovereign Government Yield 10 year
China Sovereign Government Yield 10 year
Market Return 12.95%
14.31%
Hong Kong market return 10 year
China market return 10 year
Estimated nominal Beta 0.90
1.41
Average Beta for the Comparable Companies in Hong Kong
Average Beta for the Comparable Companies in China
Size Premium 3.81% Adjustment to account for market capitalization of AsiaPhos
Specic Premium 3.00% Adjustment to account for the operational risk of Mianzhu Norwest
Cost of debt
Cost of debt represents the long term borrowing cost of the Company. From information provided by the
Company, the cost of debt is assumed to be 6.55%.
Other risks
We have accounted for other risks in the calculation of the cost of equity, in recognition of the fact that
the cost of equity can be higher than that predicted by the WACC because of factors independent of the
general stock market, such as country risk, liquidity risk, the size of business etc.
In Summary, the discount rate calculated is 14.00%.
T. VALUATION COMMENTS
The valuation of an interest in an asset requires consideration of all relevant factors affecting the
operation of the business and its ability to generate future investment returns. The factors considered in
the valuation included, but were not limited to, the following:
the nature of the business;
the nancial condition of the business and the economic outlook in general;
the operational contracts and agreements in relation to the business;
the projected operating results;
the resources estimates are based on limited drilling information; and
the nancial, business risk and geological risk (such as earthquakes) of the mining operation
including the continuity of income and the projected future results.
The conclusion of the value is based on accepted valuation procedures and practices promulgated in
the VALMIN Code that rely substantially on the use of numerous assumptions and the consideration
of many uncertainties, not all of which can be easily quantied or ascertained. Furthermore, while
the assumptions and consideration of such matters are considered by us to be reasonable, they are
inherently subject to signicant business, economic and competitive uncertainties and contingencies,
many of which are beyond the control of the Company.
K-27
U. OPINION OF VALUE
Based on the results of our investigations and analysis outlined in the report which follows, we are of the
opinion that the Fair Market Value of the Project as at the Valuation Date is in the range of RMB1.0 billion
to RMB1.6 billion with the preferred value being RMB1.3 billion.
V. LIMITING CONDITIONS
This report and opinion of value are subject to our Limiting Conditions as included in Exhibit A of this
report.
Yours faithfully,
For and on behalf of
Jones Lang LaSalle Corporate Appraisal and Advisory Limited
Johannes F. Erasmus
Simon M.K. Chan
Regional Director
K-28
EXHIBIT A LIMITING CONDITIONS
1. In the preparation of our reports, we relied on the accuracy, completeness and reasonableness of
the nancial information, forecast, assumptions and other data provided to us by the Company/
engagement parties and/or its representatives. We did not carry out any work in the nature of an
audit and neither are we required to express an audit or viability opinion. We take no responsibility
for the accuracy of such information. The responsibility for determining expected values rests solely
with the Company/engagement parties and our reports were only used as part of the Companys/
engagement parties analysis in reaching their conclusion of value.
2. We have explained as part of our service engagement procedure that it is the directors
responsibility to ensure proper books of accounts are maintained, and the nancial information
and forecast give a true and fair view and have been prepared in accordance with the relevant
standards and companies ordinance.
3. Public information and industry and statistical information have been obtained from sources we
deem to be reputable; however we make no representation as to the accuracy or completeness of
such information, and have accepted the information without any verication.
4. The management and the Board of the Company has reviewed and agreed on the report and
conrmed that the basis, assumptions, calculations and results are appropriate and reasonable.
5. Jones Lang LaSalle Corporate Appraisal and Advisory Limited shall not be required to give
testimony or attendance in court or to any government agency by reason of this exercise, with
reference to the project described herein. Should there be any kind of subsequent services
required, the corresponding expenses and time costs will be reimbursed from you. Such kind of
additional work may incur without prior notication to you.
6. No opinion is intended to be expressed for matters which require legal or other specialised
expertise or knowledge, beyond what is customarily employed by valuers.
7. The use of and/or the validity of the report is subject to the terms of engagement letter/proposal
and the full settlement of the fees and all the expenses.

8. Our conclusions assume continuation of prudent management policies over whatever period of
time that is considered to be necessary in order to maintain the character and integrity of the
assets valued.
9. We assume that there are no hidden or unexpected conditions associated with the subject
matter under review that might adversely affect the reported review result. Further, we assume
no responsibility for changes in market conditions, government policy or other conditions after
the Valuation/Reference Date. We cannot provide assurance on the achievability of the results
forecasted by the Company/engagement parties because events and circumstances frequently
do not occur as expected; difference between actual and expected results may be material;
and achievement of the forecasted results is dependent on actions, plans and assumptions of
management.
10. This report has been prepared solely for the internal use purpose. The report should not be
otherwise referred to, in whole or in part, or quoted in any document, circular or statement in any
manner, or distributed in whole or in part or copied to any their party without our prior written
consent. We shall not under any circumstances whatsoever be liable to any third party except
where we specically agreed in writing to accept such liability.
11. This report is condential to the client and the calculation of values expressed herein is valid only
for the purpose stated in the engagement letter/or proposal as of the Valuation / Reference Date.
In accordance with our standard practice, we must state that this report and exercise is for the use
only by the party to whom it is addressed and no responsibility is accepted with respect to any third
party for the whole or any part of its contents.
K-29
12. Where a distinct and denite representation has been made to us by party/parties interested in the
assets valued, we are entitled to rely on that representation without further investigation into the
veracity of the representation if such investigation is beyond the scope of normal scenario analysis
work.
13. You agree to indemnify and hold us and our personnel harmless against and from any and all
losses, claims, actions, damages, expenses or liabilities, including reasonable attorneys fees, to
which we may become subjects in connection with this engagement. Our maximum liability relating
to services rendered under this engagement (regardless of form of action, whether in contract,
negligence or otherwise) shall be limited to the charges paid to us for the portion of its services
or work products giving rise to liability. In no event shall we be liable for consequential, special,
incidental or punitive loss, damage or expense (including without limitation, lost prots, opportunity
costs, etc.), even if it has been advised of their possible existence.
14. We are not environmental consultants or auditors, and we take no responsibility for any actual
or potential environmental liabilities exist, and the effect on the value of the asset is encouraged
to obtain a professional environmental assessment. We do not conduct or provide environmental
assessments and have not performed one for the subject property.
15. This exercise is premised in part on the historical nancial information and future forecast provided
by the management of the Company/engagement parties. We have assumed the accuracy and
reasonableness of the information provided and relied to a considerable extent on such information
in arriving at our calculation of value. Since projections relate to the future, there will usually be
differences between projections and actual results and in some cases, and those variances may be
material. Accordingly, to the extent any of the above mentioned information requires adjustments,
the resulting value may differ signicantly.
16. Actual transactions involving the subject assets / business might be concluded at a higher or lower
value, depending upon the circumstances of the transaction and the business, and the knowledge
and motivation of the buyers and sellers at that time.
17. This report and the conclusion of values arrived at herein are for the exclusive use of our client
for the sole and specic purposes as noted herein. Furthermore, the report and conclusion of
values are not intended by the author, and should not be construed by the reader, to be investment
advice in any manner whatsoever. The conclusion of values represents the consideration based on
information furnished by the Company/engagement parties and other sources.
18. In letters relating to our engagement, AsiaPhos agreed to comply with those obligations of the
commissioning entity under the VALMIN Code including that to the best of its knowledge and
understanding, complete, accurate and true disclosure of all relevant material information will
be made. In preparing this report, JLL has relied on information provided by AsiaPhos, and JLL
has no reason to believe that information is materially misleading or incomplete or contains
any material errors. AsiaPhos has been provided with drafts of our report to enable correction
of any factual errors and notation of any material omissions. The views, statements, opinions
and conclusions expressed by JLL are based on the assumption that all data provided to it by
AsiaPhos are complete, factual and correct to the best of their knowledge. AsiaPhos has separately
represented in writing that to the best of its knowledge, they have provided JLL with all material
information relevant to their operations and projects described in this report. This report and the
conclusions in it are effective at 31 March 2013. Those conclusions may change in the future with
changes in relevant metal prices, exploration and other technical developments in regard to the
projects and the market for mineral properties.
K-30
EXHIBIT B VALUERS BIOGRAPHY
Johannes F. Erasmus
Qualications and Professional Memberships
BSc. (Geology) Univ. of South Africa
Graduate Diploma Engineering (Mining) Univ. of Witwatersrand
MSc (Mineral Economics) Univ. of Witwatersrand
Professional Geoscientist AEPGBC Canada
Experience
Johannes has the appropriate relevant qualications, experience and competence to be considered
an Expert and Qualied Person under the denitions provided in the NI43-101, JORC and
VALMIN Codes.
Johannes has been involved in the mining industry since 1979 and has extensive experience in
exploration and due diligence assessment of mining projects and has completed a number of
mining project valuations.
Conrmation of Qualied Person
1. I conrm that I am a person who has more than 10 years of experience in the mining industry,
meeting the following minimum requirements:

(i) I am a professionally qualied and a member in good standing of the Association of
Professional Engineers and Geoscientists, British Columbia, Canada (APEGBCC)
(ii) that APEGBC is a self-regulatory organisation of professionals in the mining industry and:
a. admits members on the basis of academic qualications and experience;
b. requires compliance with the organisations professional standards of competence and
ethics established; and
c. has disciplinary powers to suspend or expel a member
(iii) I have at least ve years relevant professional experience in the estimation, assessment
and evaluation of mineral assets which are of similar style of mineralization as the subject
mineral.
(iv) I have not been found to be in breach of any relevant rule or law and am not
a. denied or disqualied from membership of;
b. subject to any sanction imposed;
c. the subject of any disciplinary proceedings; or
d. the subject of any investigation which might lead to disciplinary action by any relevant
regulatory authority or professional association.
K-31
2. In light of the above, I conrm that I have the relevant and appropriate qualications, experience
and technical knowledge as required under the proposed SGX-ST Catalist Board listing rules
for mineral, oil and gas companies to professionally and independently appraise the assets and
liabilities being reported upon.
Simon M.K. Chan

Regional Director
Qualications and Professional Memberships
B. Commerce
FCPA
FCPA (Aust)
Member, CIM
Member, IACVA

Experience
Simon has extensive work experience in valuation and corporate advisory industries. He has provided a
wide range of valuation services to numerous listed and listing companies of different industries in China,
Hong Kong, Singapore and the United States. The valuation services provided include rm valuation,
equity valuation, mining rights and mineral assets valuation, purchase price allocation, intangible asset
identication and valuation (e.g. trademark, customer base, patent, etc.), biological asset valuation, current
asset and liability valuation, goodwill and other asset impairment evaluation, convertible bond valuation,
employee share option valuation and other nancial instrument valuation. Simon has participated in certain
large scale IPOs of State-owned and privately-owned enterprises in China. He has successfully assisted
various multinational companies invested in China and has provided different extent of valuable due diligence
services for these companies.

K-32
EXHIBIT C VALUERS PROFESSIONAL DECLARATION
The following valuers certify, to the best of their knowledge and belief, that:
JLL is not a sole-practitioner rm.
Information has been obtained from sources that are believed to be reliable. All facts which have a
bearing on the value concluded have been considered by the valuers and no important facts have
been intentionally disregarded.
The reported analyses, opinions, and conclusions are subject to the assumptions as stated in
the report and based on the valuers personal, unbiased professional analyses, opinions, and
conclusions. The valuation exercise is also bounded by the limiting conditions.
The reported analyses, opinions, and conclusions are independent and objective.
The valuers have no present or prospective interest in the asset that is the subject of this report,
and have no personal interest or bias with respect to the parties involved
The valuers and JLLs compensation is not contingent upon the amount of the value estimate,
the attainment of a stipulated result, the occurrence of a subsequent event, or the reporting of a
predetermined value or direction in value that favours the cause of the client.
The valuers, JLLs partners, directors, substantial shareholders and their associates are
independent of AsiaPhos, its directors and substantial shareholders and the valuers, JLLs partners,
directors, substantial shareholders and their associates do not have any interest (direct or indirect)
in nor have worked for AsiaPhos, its subsidiaries or associated companies and will not receive
benets other than remuneration paid to the valuers (Qualied Person) in connection with this
Report (pursuant to the proposed SGX-ST Catalist Board listing rules for mineral, oil and gas
companies).
The analyses, opinions, and conclusions were developed, and this report has been prepared, in
accordance with the International Valuation Standards published by the International Valuation
Standards Committee and VALMIN code.
Each of Jones Lang LaSalle Corporate Appraisal and Advisory Limited and Johannes F. Erasmus,
the qualied person producing the Independent Valuation Report, has conrmed that it/he has
reviewed the information contained in the draft Offer Document (to be lodged with the SGX-ST
acting as agent on behalf of the Monetary Authority of Singapore) which relates to the Independent
Valuation Report and further conrmed that the information presented therein is accurate,
balanced, complete and not inconsistent with the Independent Valuation Report.
The under mentioned persons provided professional assistance in the compilation of this report.
Johannes F. Erasmus Simon M. K. Chan
Principal Consultant Regional Director
BSc (Geo), GDE, MSc, FCPA, FCPA (Aust)
P.Geo. Member of CIM, Member of IACVA

K-33
Valuers Declaration II:
I, Johannes F. Erasmus, hereby certify that:
1. I have read the denition of Expert and Specialist set out in the VALMIN Code and certify, by
reason of my education, affiliation with a professional association and past relevant work
experience, that I fulll the requirements to be an Expert for the purpose of the VALMIN Code.
2. I have read the denition of qualied person set out in the proposed SGX-ST Catalist Board
listing rules for mineral, oil and gas companies and certify that I fulll the requirement to be a
qualied person for the purpose of the said rules.
3. I am responsible for the preparation of all portions of this valuation report. I undertook a site visit to
the Project in December 2012.
4. I have read the VALMIN Code and the valuation report has been prepared in accordance with the
VALMIN Code.
5. I am a Professional Geoscientist (P.Geo.). I have more than thirty years of experience in the
resources industry.
6. I am not a sole practitioner in this valuation exercise.
7. I am not aware of any material fact or material change with respect to the subject matter of the
valuation report that is not reected in the valuation report, that a failure to disclose would make
the valuation report misleading.
8. I am independent of Mianzhu Norwest, AsiaPhos and Norwest Chemicals, in compliance with
Clause 24 of the VALMIN Code.
9. The valuation report is prepared within Jones Lang LaSalle with registered address at 6/F Three
Pacic Place, 1 Queens Road East, Hong Kong.
Johannes F. Erasmus
K-34
I, Simon M. K. Chan, hereby certify that:
1. I have read the denition of Expert and Specialist set out in the VALMIN Code and certify, by
reason of my education, affiliation with a professional association and past relevant work
experience, I fulll the requirements to be a Specialist for the purpose of the VALMIN Code.
2. I am responsible for the review of this valuation report.
3. I have read the VALMIN Code and the valuation report has been prepared in accordance with the
VALMIN Code.
4. I am a certied public accountant in Hong Kong (HKICPA) and Australia (CPA (Aust)), and I am
also a member of the CIM and IACVA. I have extensive work experience in valuation and corporate
advisory industry.
5. I am not aware of any material fact or material change with respect to the subject matter of the
report that is not reected in the report, that a failure to disclose would make the report misleading.
6. I am independent of Mianzhu Norwest, AsiaPhos and Norwest Chemicals, in compliance with
Clause 24 of the VALMIN Code.
7. The valuation report is prepared within Jones Lang LaSalle with registered address at 6/F Three
Pacic Place, 1 Queens Road East, Hong Kong.
Simon M.K. Chan
K-35
EXHIBIT D GLOSSARY
Mianzhu Norwest Sichuan Mianzhu Norwest Phosphate Chemical Company Limited
NI43-101 A national instrument for the Standards of Disclosure for Mineral Projects within
Canada. The Instrument is a codied set of rules and guidelines for reporting
and displaying information related to mineral properties owned by, or explored
by, companies which report these results on stock exchanges within Canada.
JORC Code A code of professional conduct developed by the Joint Ore Reserves
Committee which sets the minimum standards for public reporting of Exploration
Results, Mineral Resources and Ore Reserves in Australia and New Zealand
and which has been adopted by and included in the listing rules of the
Australian Stock Exchange and the New Zealand Stock Exchange.
VALMIN Code A code of professional conduct that establishes standards of best practice
for the technical assessment and valuation of mineral and petroleum assets
and securities by geologists involved in the preparation of Independent
Experts Reports. The VALMIN Code was developed by a joint committee of
The AusIMM, AIG and MICA (now the Consultants Society of The AusIMM),
in consultation with the Australian Securities and Investment Commission,
the Australian Stock Exchange Limited, the Minerals Council of Australia,
the Petroleum Exploration Society of Australia, the Securities Association of
Australia and representatives from the Australian nance sector. The Code is
binding on all members of The AusIMM and AIG.
K-36
EXHIBIT E VALUATION RESULT FOR PREFERRED VALUE
Valuation Date: 31 March 2013
Unit: RMB Millions
31 Mar to 31 Dec 2013 2014 2015 2016
1. Profit and Loss
Revenue 136 237 337 420
Cost of Sales (106) (171) (230) (277)
Gross Profit 30 66 107 142
Selling Expenses (3) (5) (6) (6)
General & Administrative Expenses (4) (6) (6) (6)
Earnings Before Interest and Tax 23 56 95 130
Corporate Income Tax (6) (14) (24) (32)
Debt-Free Net Profit 17 42 71 97
2. Free Cash Flow to Firm 31 Mar to 31 Dec 2013 2014 2015 2016
Add: Depreciation 4 9 12 13
Less: Increase in working capital (14) (2) (2) (2)
Add: Release of working capital 0 0 0 0
Less: Capital expenditure (39) (35) (3) (5)
Free Cash Flow to Firm (32) 13 79 104
3. Valuation 31 Mar to 31 Dec 2013 2014 2015 2016
Free Cash Flow to Firm (32) 13 79 104
Discount Rate 14% 14% 14% 14%
Time from Valuation Date 0.38 1.25 2.25 3.25
Discount Factor 0.952 0.849 0.745 0.653
Present Value (30) 11 59 68
Value for Mining Project 1,262

K-37
2017 2018 2019 2020
1. Profit and Loss
Revenue 513 653 827 877
Cost of Sales (332) (403) (486) (518)
Gross Profit 181 250 340 358
2. Free Cash Flow to Firm 2017 2018 2019 2020
Free Cash Flow to Firm 133 184 252 268
3. Valuation 2017 2018 2019 2020
Discount Factor 0.573 0.503 0.441 0.387
Present Value 76 93 111 104

K-38
2021 2022 2023 2024
1. Profit and Loss
Revenue 930 987 1,047 1,112
Cost of Sales (553) (589) (628) (671)
Gross Profit 377 398 420 442
3. Valuation 2021 2022 2023 2024
Discount Factor 0.339 0.298 0.261 0.229

K-39
2025 2026 2027 2028
1. Profit and Loss
Revenue 1,182 1,257 1,358 1,426
Cost of Sales (710) (753) (824) (864)
Gross Profit 472 504 533 562
3. Valuation 2025 2026 2027 2028
Discount Factor 0.201 0.176 0.155 0.136

K-40
2029 2030 2031 2032
1. Profit and Loss
Revenue 1,497 1,572 1,650 1,733
Cost of Sales (908) (953) (1,000) (1,049)
Gross Profit 589 619 650 684
3. Valuation 2029 2030 2031 2032
Discount Factor 0.119 0.104 0.092 0.080

CS Reference number: 430699
21 June 2013
Independent market
consultants report
A report prepared for AsiaPhos Private Limited
APPENDIX L CRU INDUSTRY REPORT
L-1
This report has been prepared soley for inclusion in the offer document of AsiaPhos Limited (the Company) in
connection with the initial public offering of the shares of the company on the Catalist Board of the Singapore Exchange
Securities Trading Limited, and should not be used or relied upon for any other purpose. Although reasonable care and
diligence has been used in the preparation of this report, we do not guarantee the accuracy of any data, assumptions,
forecasts or other forward-looking statements.
CRU International Limited 2013. All rights reserved.
CRU Strategies, a division of CRU International Limited
Chancery House, 53-64 Chancery Lane, London, WC2A 1QS, UK
Tel: +44 (0)20 7903 2000 Fax: +44 (0)20 7903 2172 Website: www.crustrategies.com
L-2
Independent market consultants report for Project Phoenix
CRU Strategies
Contents
Page
Qualifications of the Consultancy 1

Chapter 1 Outlook for phosphates 2
Introduction 2
1.1 Phosphate rock & downstream products 3
1.2 World phosphate rock outlook to 2022 4
1.2.1 Outlook for phosphate rock demand 5
1.2.2 Outlook for phosphate rock supply 7
1.3 World phosphorus (P
4
) outlook to 2022 10
1.3.1 Manufacturing P
4
11
1.3.2 P
4
demand in 2012 11
1.3.3 P
4
demand to 2022 14
1.3.4 P
4
supply to 2022 19
1.4 Expectations briefing 21
Chapter 2 Phosphate rock resources 24
2.1 Availability of phosphate rock 24
2.1.1 Global reserves 25
2.1.2 Phosphate rock quality 27
2.1.3 PRC phosphate rock deposits 28
2.1.4 PRC phosphate rock reserves 28
2.1.5 PRC phosphate rock quality 30
Chapter 3 Chinas phosphate industry 33
3.1 PRC phosphate rock production by province 33
3.2 The phosphate industry in the PRC 36
3.3 Historical review of regulations & policies 38
Chapter 4 Chinas competitive overview 40
4.1 Competitive costs for phosphate rock & P
4
40
4.2 Major global P
4
competitors 42
4.2.1 P
4
competitors outside China 43
4.3 Major PRC P
4
competitors 44
4.4 Public listed phosphate companies in China 49
L-3
CRU Strategies
Contents continued
Page
Chapter 5 Assessment of the Competitive Position of
Sichuan Mianzhu Norwest Phosphate Chemical Co., Ltd. 52
5.1 Plant Facilities 52
5.2 Competitors 53
5.3 SWOT Analysis 54
5.4 Future Prospects 55

Appendix A 56

L-4
CRU Strategies
List of Tables
Page
Chapter 1 Outlook for phosphates
Table 1.1 World phosphate rock consumption by region, 2001-2022 (million tonnes
of rock) 7
Table 1.2: World phosphate rock production by region, 2001-2022 (million tonnes) 10
Table 1.3: World phosphorus capacity 2012 (thousands of tonnes P
4
) 19
Table 1.4: Factors for and against the ongoing production of thermal acid in China 23
Chapter 2 Phosphate rock resources
Table 2.1: Estimated phosphate rock reserves - 2012 (in million tonnes of
phosphate rock at less than US $100/t) 26
Table 2.2: Estimated phosphate rock statistics for China by province
(billions of tonnes) 30
Table 2.3: Typical composition of selected phosphate concentrates 30
Chapter 3 Chinas phosphate industry
Table 3.1: China phosphate production & phosphate rock consumption
(millions of tonnes of P
2
O
5
and rock) 36

Chapter 4 Chinas competitive overview
Table 4.1: World phosphorus capacity 2012 (thousands of tonnes P
4
) 43
Table 4.2: P
4
Producers in China 47
Table 4.2: P
4
Producers in China (continued) 48
Table 4.3: Chinese listed (public) companies 50
Table 4.4: Chinese Industrial Phosphate listed (public) companies 51

Appendix A 56
Table A.1: Phosphate rock price forecast, 1995-2017 (US$/tonne) 56
L-5
I ndependent mar k et c onsul t ant s r epor t f or Pr oj ec t Phoeni x
CRU Strategies 1
Qual i f i c at i ons of t he Consul t ancy
CRU Strategies is the division of CRU International Ltd which is responsible for providing single
client reports and studies. These single-client products can include market studies, strategy
analysis, competitive costs, merger & acquisition assistance and negotiation support. CRU
Strategies benefits from the wider synergies of being part of the CRU Group that specializes in
consultancy in the metals and other minerals extraction businesses as well as in the fertilizer
sector. With regard to the latter, the CRU Fertilizer Group (formerly British Sulphur Consultants)
is the original and leading business consultancy for the fertilizer and inorganic chemicals industry
with over 55 years of industry experience. Most companies, past and present, who have been
involved in the fertilizer business have been CRU clients including Governments, financial
institutions and other multilateral agencies. CRUs portfolio includes comprehensive coverage of
current supply & demand data, market analysis and prices published in regular reports as well as
providing confidential and tailored reports to address a companys specific requirements.

L-6
2 CRU Strategies
Chapt er 1 Out l ook f or phosphat es
I nt r oduc t i on
The phosphate industry has many different sources of supply and a number of different
upstream products and uses. A detailed description of each would be very extensive and is not
necessary for this report. However, it is important to know that nearly all the phosphates
consumed around the world originate from phosphate rock. With this in mind, this chapter will
provide the reader with a basic introduction to the phosphate industry (fertilizer & non-
fertilizer) including the ten-year outlook. The emphasis will be to provide a summary of the
world phosphate market, with a focus on China, phosphate rock and phosphorus.
Before we begin, a few of the most important definitions and abbreviations are reviewed:
x Phosphate Rock is a naturally occurring mineral that is the raw material source for
more than 99% of the worlds phosphate production and consumption. In this
report, CRU will measure phosphate rock by an average 31% P
2
O
5
content (see
Chapter 2 for explanation of rock grades and quality).
x Phosphate is a molecular anion (negatively charged ion) contained in the inorganic
chemical phosphoric acid. It is primarily used as a nutrient essential to plant,
animal and human life.
x P
2
O
5
is used to measure the available phosphate content of a compound or a
product.
x Phosphorus is an element with the symbol P. Phosphorus is never found as a free
element in nature. Since the most important form of phosphorus consist of
tetrahedral molecules, in this report, P
4
will be used to describe elemental
phosphorus manufactured by the furnace process.
x Phosphorus derivatives are phosphate containing compounds directly
manufactured fromelemental phosphorus (P
4
).
x Thermal phosphoric acid (TPA) is a high quality acid manufactured from
elemental phosphorus (P
4
).
x Wet-process phosphoric acid (WPA) is an acid manufactured from the acidulation
of phosphate rock.
x Purified Phosphoric Acid (PPA) is a high quality acid manufactured from WPA.
L-7
CRU Strategies 3
The most important conversions in this report will be for phosphate rock to P
2
O
5
. It requires
3.22 tonnes of phosphate rock (average 31% P
2
O
5
content) for one tonne of 100% P
2
O
5
. To
convert P
2
O
5
to P
4
, multiply the P
2
O
5
content by 0.4366 or divide by 2.185. Other abbreviations
and conversions used in this report will be defined where needed.
1.1 Phosphat e r oc k & dow nst r eam pr oduc t s
Phosphate rock is a mineral that is used as a raw-material to manufacture 99% of the worlds
upstream phosphate products (reviewed later in this chapter). Fertilizers are responsible for
about 88% of the worlds phosphate rock consumption and phosphate demand. For fertilizers,
phosphate is one of the three primary nutrients necessary for plant growth (nitrogen and
potassium are the other two). There are no known substitutes for phosphorus as a fertilizer
ingredient: it is essential for all plant and animal life. Plants absorb phosphate from the soil and
convert it to forms that can be absorbed by people and animals. All soils contain some
phosphate, but on agricultural land, when vegetation is removed through grazing or harvesting,
this removes phosphates that will need to be replenished through the application of phosphate
fertilizer. This combination of planting, phosphate fertilizer application and harvesting means
that the phosphate fertilizer industry has a guaranteed future and that demand for phosphates
should grow in line with the growth of crop production.
Phosphates are also used as an ingredient in animal feeds representing about 6% of the worlds
total phosphate and phosphate rock demand. Phosphorus is a major constituent of bones and
plays an important role in a number of physiological functions in animals. Phosphate use in
animals diets can be partially reduced by including some organic products or by improving the
animals digestion of phosphate already present in the feed.
Phosphates can be also be used in a variety of industrial and food applications where the
remaining 6% of products are consumed. It is used as a building block in detergents, as a food
additive, for acid treatment of metal surfaces, in water treatment and other miscellaneous
applications. Some substitution is possible, especially on the detergent side of the business.
L-8
4 CRU Strategies

The diagram above is intended as a visual to show that phosphate rock and manufactured
phosphate products can be used in a number of different downstream products. Many more
layers of products could be added at each level. All of the products in the second column of
boxes from the left are made directly from phosphate rock while the products in the third
column of boxes from the left are made from either wet-process phosphoric acid (WPA) or
4
). Industrial & Food salts (fourth column of boxes from the left) are
made from either purified or thermal phosphoric acids.
1.2 Wor l d phosphat e r oc k out l ook t o 2022
Phosphate rock is the raw material for making nearly all phosphate products. The largest end
use for phosphate rock is by the fertilizer industry with an estimated 88% of global
consumption. Phosphate rock is generally converted to another more soluble and useful form
before applied to the soil as a fertilizer ingredient. Phosphate rock is consumed primarily in the
production of the intermediate product phosphoric acid (WPA) or thermal phosphorus (P
4
). The
major downstream phosphate fertilizer products include ammonium phosphates (DAP & MAP),
triple superphosphate (TSP) and single & double superphosphate (SSP/DSP). The WPA, TSP,
SSP & DSP consume phosphate rock directly in their production processes while the DAP and
MAP are made from the phosphoric acid and do not require additional rock when manufactured.
TSP requires some additional phosphoric acid to make its product grade.
CRU STRATEGIES
The world phosphate industry
Phosphate Rock
Triple (T SP)
Superphosphate
Single (S SP)
Superphosphate
Double (D SP)
Superphosphate
Defluorinated
Phosphate (DFP)
Fused (FP)
Phosphates
Nitrophosphates
Direct Application
Phosphate Rock
Elemental
Phosphorus (P
4
)
Diammonium
Phosphate (DAP)
NPK Fertilizers
(NPKs)
Super Phosphoric
Acid (SPP)
Animal Feed
Phosphates (MCP/DCP)
STPP
(from WPA)
Purified wet acid
(PPA)
Thermal Acid
(TPA)
Phosphorus dependent
derivatives
Industrial & Food
Salts
Wet-process (WPA)
Phosphoric Acid
Monoammonium
Phosphate (MAP)
L-9
CRU Strategies 5
Feed and Industrial phosphates each account for about 6% of global phosphate rock
consumption. Once again, the phosphate rock is converted to a usable form before final
consumption. Feed phosphates are used as supplements in animal nutrition. The major products
are calcium phosphates (MCP, DCP & DFP). The first two are made from the intermediate
phosphoric acid and are not direct phosphate rock consumers while manufacturing DFP is a
direct consumer of rock.
Industrial phosphates (including food grade phosphates) also represent a wide variety of
products and uses. Phosphate rock is used directly to manufacture elemental phosphorus (P
4
)
which is the intermediate product for phosphate dependent derivatives or thermal phosphoric
acid (TPA) which is a very pure grade of phosphoric acid. In addition to TPA, purified
phosphoric acid (PPA) made from wet-process phosphoric acid can be used to make industrial
phosphates. These industrial phosphate products are explained later in this report.
1.2.1 Out l ook f or phosphat e r oc k demand
Based on preliminary data, it appears that phosphate rock, along with the phosphate market, had
a record year in 2012. Total phosphate rock consumption (fertilizer & non-fertilizer) grew from
an estimated 151 million tonnes in calendar-year 2001 to an estimated 191 million tonnes in
2012, representing an annual growth of about 2.4% per year.

CRU STRATEGIES
World phosphate rock demand in 2012
(191 million tonnes of rock)
88%
6%
6%
Fertilizers
Feed Phosphates
Industrial
L-10
6 CRU Strategies
These markets are forecast to continue upward into the future although at a slower rate. The
longer-term fundamentals remain positive as they are tied to crop production which is driven by
population and economic growth. Hence, the change in crop production is the most important
factor for forecasting phosphate demand and the resulting phosphate rock demand.
Most forecasters agree that per capita food consumption is increasing because of increasing
population with higher average incomes. With a limited and possibly shrinking land resource
because of urbanisation, forecasters also agree that most of this growth in agricultural output
will be from increased crop yields on the existing agricultural land base. There is also some
agreement on where this growth in crop production will occur. However, what forecasters do
not agree on is the amount and type of phosphate fertilizers that will be required to grow these
crops. Phosphate and the resulting phosphate rock demand forecast can vary widely and
relatively small changes in the expected growth rate could represent millions of tonnes of
consumption during a 10-year forecast period. More efficient application techniques, better
products and less waste will also slow the growth in fertilizer phosphate demand.
Phosphate rock is consumed at the point where the phosphate end-product is
manufactured. Phosphate rock for fertilizers is consumed in at least 63 countries at hundreds of
phosphoric acid and superphosphate plants. By 2022, about 90% of the total consumption will
be for phosphoric acid based fertilizers. This would represent about 200 million tonnes of
phosphate rock with an average P
2
O
5
content of 31%. These will be the plants and the locations
where the bulk of the phosphate rock will be consumed. The next largest consumption of
phosphate rock is in SSP production where an estimated 5 million tonnes P
2
O
5
will be
manufactured in 2022 consuming about 16 million tonnes of phosphate rock. The largest SSP
manufacturers are in Brazil, India and China.
As shown on the Table 1.1 below, the 2022 forecast for world phosphate rock consumption is
227.6 million tonnes or a growth of 36.5 million tonnes over this ten-year period. The current
forecast represents a compound annual average growth rate (CAGR) of 1.8% per year. This is
below the worlds historical 10-year average of 3% per year mainly because of China. China
will remain the worlds largest phosphate rock consumer using about 77 million tonnes in 2012
and forecast to be flat going forward to 2022. However, this CRU forecast of Chinese
consumption through 2022 is a substantial change from the 5% growth rate during the previous
10-year period. CRU believes that Chinas growth will slow in the future as the country sharply
reduces upgraded phosphate (P
2
O
5
) exports by 2022. This is in contrast to a sizable growth in
exports of phosphate fertilizers, in particular DAP, which occurred in the prior 10 years. This
decline in Chinese exports of phosphate products (primarily fertilizer) will slow the growth in
Chinese domestic phosphate rock consumption, which will increasingly be focused on meeting
domestic demand only.
L-11
CRU Strategies 7
Tabl e 1.1 Wor l d phosphat e r oc k c onsumpt i on by r egi on, 2001-2022
(mi l l i on t onnes of r oc k )

Phosphate rock demand is forecast to grow in most regions except Western & Central Europe,
North and Central America, and South and East Asia. The strongest tonnage growth is forecast
for Africa (mainly Morocco & Tunisia), the Middle East (mainly Saudi Arabia & J ordan), South
America (Brazil), SE Asia, and Oceania. It is not coincidental that these are the same
regions/countries where new phosphoric acid capacity is being planned and likely to be built.
1.2.2 Out l ook f or phosphat e r oc k suppl y
Phosphate rock is a mineral and the raw material for virtually all phosphate products.
Commercial quantities of phosphate rock are currently found in sedimentary and igneous rocks
and in guano.
Apatite is the most common geologic name for this group of phosphate minerals. Sedimentary
phosphate rocks are the most common commercial form of apatite found as the inorganic
mineral hydroxyl apatite (an impure tri-calcium-phosphate). Geologically speaking, these
sedimentary phosphate rock deposits were believed to be formed in a marine environment
before being deposited, decomposed and accumulated.
Igneous phosphate rocks are a less plentiful apatite mineral and the commercial form is
generally a fluorapatite (calcium fluorophosphates). Geologically, the origin of these rocks is
Tonnes CAGR
Wor ld Tot al 143.3 167.6 188.0 191.1 220.0 227.6 36.5 1.8%
West Europe 8.2 6.4 4.9 4.3 4.3 4.0 -0.3 -0.7%
Central Europe 2.4 2.9 2.3 2.3 2.3 2.3 0.0 0.0%
FSU (Former Soviet Union) 9.3 11.9 12.7 13.2 14.2 15.3 2.1 1.5%
Africa 22.1 24.0 23.4 25.8 32.1 39.8 14.0 4.4%
North America 36.1 34.0 34.7 31.7 30.0 28.4 -3.3 -1.1%
Central America 2.1 0.9 2.6 2.5 2.1 2.2 -0.3 -1.3%
South America 6.5 8.0 8.0 8.9 13.0 19.0 10.1 7.9%
Middle East 6.4 7.0 7.2 7.7 14.9 18.4 10.7 9.1%
South Asia 6.8 7.3 9.7 9.2 8.4 7.7 -1.5 -1.8%
South East Asia 3.4 3.8 4.7 4.7 5.5 7.6 2.9 4.9%
East Asia 36.2 58.2 74.9 78.3 78.0 77.7 -0.6 -0.1%
China 33.9 56.0 73.4 77.1 76.8 76.5 -0.6 -0.1%
Oceania 3.9 3.1 3.1 3.1 4.0 5.2 2.1 5.3%
( p) P r el i mi nar y ( f ) f o r ec as t
Dat a: CRU es t i mat es
2001 2006 2011 2012(p) 2017(f ) 2022(f )
Change
2012 - 2022
L-12
8 CRU Strategies
associated with volcanic activity, the apatite being concentrated in a plug or intrusions.
Decomposition from weathering and replacement is responsible for its accumulation.
The large guano deposits were formed by the accumulation of seabird excrement at nesting
sites and colonies on islands. This is the least plentiful source of commercial phosphate.
The heaviest accumulation of non-commercial phosphates is on the ocean floor formed by
decaying organic material and the ever present volcanic activity under the sea. These nodular
phosphates are the least concentrated and have been considered non-commercial because of the
high costs of harvesting. Changing technology could make this product more available in the
future.
Currently, about 84% of the worlds phosphate rock production is upgraded near the source of
the rock while the remaining 16% of rock production moves into international trade. CRU has
identified 30 countries currently mining phosphate rock, while an estimated 45 countries
convert rock into phosphoric acid, the largest end-use accounting for nearly 90% of rock
consumption worldwide. Some countries also import phosphate rock for non-phosphoric acid
uses like the production of super phosphates, elemental phosphorus or other industrial and non-
agricultural uses. Phosphates are truly an international commodity as about 16% of phosphate
rock production, 15% of phosphoric acid production and nearly half of the DAP, MAP and TSP
produced worldwide is being exported.
The long-term forecast shows phosphate rock production is equal to demand, although stocks
can fluctuate from year-to-year. Phosphate rock production is forecast to grow 31.9 million
tonnes during the forecast period.
Forecasting production by country is a dynamic and risky exercise complicated by the changes
in the overall P
2
O
5
demand and capacity, and determining if this demand will be satisfied by
local production, imports or changes in inventory. Existing capacity is generally known but new
capacity will eventually be built and will compete for a share of the market. The diagram below
shows that exploration for phosphate rock is occurring throughout the world. However, only
some of these projects will advance to the development stage and become new mines.
L-13
CRU Strategies 9

The phosphate rock production forecast shows that gains in Africa, South America, and the
Middle East will continue. In nearly all regions/countries, most of the phosphate rock
production will be consumed at nearby captive P
2
O
5
conversion plants. In Africa (Morocco &
Tunisia) and the Middle East (J ordan & Saudi Arabia), phosphate fertilizers (P
2
O
5
)

will be
manufactured domestically then most of these upgraded phosphate products will be exported.

While in South America (Brazil) and East Asia (China), both the phosphate rock and the
upgraded domestic P
2
O
5
production will be for local consumption.

Some exceptions exist like
the potential new mines in Kazakhstan, Peru, Guinea-Bissau, Mozambique, Namibia and
Australia that will export the phosphate rock. The phosphate rock production forecast for North
America assumes two new mines in Florida and one in Idaho are built in the United States
before 2022.
China is also the worlds largest producer of phosphate rock with an estimated 77.5 million
tonnes in 2012. Most of this production is consumed domestically as the government has
restricted exports to a gradually declining quota which for 2013 is set at 1 million tonnes. CRU
forecasts no production growth as compared to the prior 11 year period which saw production
growth of 38.5 million tonnes, to insure that production meets only domestic demand. During
this period China achieved self sufficiency in phosphate production and became a significant
exporter of phosphates. CRU believes that the same philosophy as with rock will prevail with
the fertilizer derivatives thereof; and that, therefore China will scale back production to more
CRU STRATEGIES
BRAZIL
Aguia Resources
MBAC Ferti li zers
Redstone Resources
Ri o Verde Mi nerals
AUSTRALIA
Arafura Resources
Korab Resources
Kruci bl e Metals
Minemakers
Legend
Oklo Urani um
Phosphate Austral i a
Rum Jungl e Resources
PERU
Fosfatos del Pacifi co
(Cementos Pacasmayo + Mi tsubishi )
Focus Ventures
GrowMax Agri Corp
Minemakers
Stonegate Agri com
IDAHO
Stonegate Agri com
KAZAKHSTAN
EuroChem
Sunkar Resources
NAMIBIA
Mi nemakers / Union Resources
ROC / DRC / ANGOLA
Cominco Resources
Mi nbos Resources
UGANDA
Ni l efos Mi nerals
MALI
Great Quest Metals
Oklo Urani um
TUNISIA
Numidia Phosphate
FINLAND
Yara
ONTARIO
PhosCan Chemical Corp.
MOZAMBIQUE
Vale
IRAQ
Iraq State Company for Phosphate
QUEBEC
Ari anne Resources
GUINEA-BISSAU
Pl ai ns Creek Phosphate
Phosphate rock exploration & potential new mines
L-14
10 CRU Strategies
closely match domestic demand. In 2012, China exported the equivalent of over 8 million
tonnes of rock in the form of high analysis phosphate fertilizers (DAP, MAP, TSP).
Tabl e 1.2: Wor l d phosphat e r oc k pr oduc t i on by r egi on, 2001-2022
(mi l l i on t onnes)

1.3 Wor l d phosphor us (P
4
) out l ook t o 2022
Phosphorus is a non-metallic chemical element and because of its high reactivity, it is never
found as a free element in nature. There are several forms of manufactured phosphorous: white,
yellow, red and black. White (less pure but often referred to as yellow) glows in the dark, is
spontaneously combustible when exposed to air and is a deadly poison. Red phosphorous can
vary in colour from orange to purple, due to slight variations in its chemical structure. Black
phosphorous, is made under high pressure, looks like graphite and, like graphite, it has the
ability to conduct electricity. These phosphorus products have different uses and can exist as
compounds in nature.
Phosphorus compounds can be used in military applications such as explosives, nerve agents,
smoke screening and for tracer ammunition. Commercial uses of phosphorus include industrial
chemicals, inorganic compounds and inorganic acids. Some important uses include food
applications, cleaning agents, flame retardants, pesticides, water treatment, specialty steel
making, commercial fireworks and pesticides. There are no substitutes for phosphorus
Tonnes CAGR
Wor ld Tot al 142.9 168.4 193.0 195.3 208.8 227.2 31.9 1.5%
West Europe 0.8 0.9 0.9 0.8 1.0 2.5 1.7 12.1%
Central Europe 0.0 0.0 0.0 0.0 0.0 0.2 0.2 0.0%
FSU (Former Soviet Union) 11.7 12.4 13.2 12.9 13.7 16.2 3.3 2.3%
Africa 37.0 43.1 41.3 41.6 47.8 53.6 12.0 2.6%
North America 32.5 31.0 28.5 30.0 26.3 27.4 -2.6 -0.9%
Central America 0.8 0.0 1.7 1.7 1.4 2.2 0.5 2.8%
South America 4.8 6.2 8.8 10.0 14.3 15.7 5.7 4.6%
Middle East 11.7 12.4 15.5 14.3 19.7 22.2 7.9 4.5%
South Asia 1.3 1.6 2.1 1.5 1.5 1.5 0.0 0.0%
South East Asia 0.7 1.2 2.4 1.6 1.8 1.8 0.2 1.2%
East Asia 38.9 57.0 75.1 77.6 77.9 79.1 1.5 0.2%
China 38.8 56.9 75.0 77.5 77.8 78.6 1.1 0.1%
Oceania 2.8 2.6 3.6 3.4 3.7 4.1 0.7 2.0%
( p) P r el i mi nar y ( f ) f o r ec as t
Dat a: CRU es t i mat es
2017(f ) 2022(f )
Change
2012 - 2022
2001 2006 2011 2012(p)
L-15
CRU Strategies 11
derivatives made directly from elemental phosphorus. However, thermal phosphoric acid and
wet-process purified phosphoric acid (PPA) may be substitutes.
1.3.1 Manuf ac t ur i ng P4
Since the phosphorus molecule is composed of four phosphorus atoms, the generic term P
4
is
often used. Phosphorus is also referred to as elemental phosphorus. P
4
is manufactured by a
thermal process by burning or heating a relatively low grade phosphate rock in the presence of
silica and a reducing agent (calcined petroleum coke). The reaction takes place at about 1600
degreesC, liberating the phosphorus in a gas phase. This process is endothermic and requires a
substantial amount of heat to sustain the reaction. P
4
can then be isolated or converted into other
more stable and commercial forms; the most common is thermal phosphoric acid (TPA).
The high quality phosphoric acid that is manufactured from this P
4
is produced in the electric
furnace process by oxidation of the P
4
to form a P
4
O
10
gas. A hydrator converts this P
4
O
10
gas
into phosphoric acid. The waste product is an inert slag. Once again, this electric furnace
phosphoric acid is considered a high purity product but requires a considerable amount of
energy to produce.
A more widely used and less expensive method for phosphoric acid manufacturing is by the
wet-process phosphoric acid (WPA) process. In the WPA process, the rock is reacted with
sulphuric acid (other acids may also be used) to form an intermediate and lower grade filter acid
that can be concentrated and clarified to produce a 54% P
2
O
5
(the phosphorus pentoxide
content) product commonly known as merchant grade acid (MGA). This acid can further be
concentrated to a 68-70% P
2
O
5
super-phosphoric acid (SPA). The WPA filter acid can also be
purified using solvent extraction technology to make a purified phosphoric acid (PPA) with a
somewhat lower 62% P
2
O
5
(85% H
3
PO
4
) content but much higher quality product because of
lower impurities. This is the product that competes with TPA.
A kiln-based process can also be used to make phosphoric acid. This process also heats
phosphate rock to a high temperature by adding silica and using petroleum coke fed into one
side of a kiln, and after a hydration step, a finished phosphoric acid is produced. This process is
also energy intensive. Some companies are working to make the kiln-based process commercial.
1.3.2 P4 demand i n 2012
The demand for phosphorus can be broadly split into two main applications:
x Production of directly derived derivatives, which include red phosphorus,
phosphorus pentoxide (P
2
O
5
), phosphorus trichloride (PCl
3
), phosphorus
pentasulfide (P
2
S
5
), polyphosphoric acid and phosphorus acid.
L-16
12 CRU Strategies
x Production of thermal phosphoric acid.
Phosphorus derivatives are used in numerous applications, particularly those where there are no
substitutes for elemental phosphorus. The main phosphorus derivatives and their applications
are as follows:
x Red Phosphorus
o Flame retardants
o Matches, fireworks, and pyrotechnics
o Aluminium phosphide & other metal phosphides
o Semiconductors
o Smoke bombs and munitions
x Anhydrous phosphorus pentoxide (P
2
O
5
)
o Phosphate esters
o Vitamin synthesis
o Ammonium polyphosphates
x Phosphorus Trichloride (PCl
3
)
o Pesticides
o Phosphorus oxychloride (POCl3)
o Flame retardants and plasticizers
o Functional fluids
o Intermediate for production of plastics additives
o Phosphorous acid (H3PO3)
o Lube oil and paint additives
x Phosphorus pentasulfide (P
2
S
5
)
o Additives for lubricants
o Organophosphorus pesticides
o Ore floatation agents
x Sodium hypophosphite
o Electroless nickel plating
x Polyphosphoric Acids (84-86% P
2
O
5
)
There are some very minor markets for these phosphorus dependent derivatives, most measured
in only one thousand tonnes of P
4
or less consumed globally each year. It is beyond the scope of
this report to try to explain the chemistry and variety of uses for each of these products. Many of
L-17
CRU Strategies 13
these products are proprietary and manufactured by one company and often at a single plant
location.
In tonnage terms, the two largest non-phosphoric acid phosphorus dependent derivatives are
phosphorus trichloride (PCl
3
) (mainly used in pesticides & flame retardants) followed by
phosphorus pentasulfide (P
2
S
5
) (mainly used in Lubricating Oil additives & insecticides)
accounting for around 80% of total non-acid demand. There is also the munitions market along
with the market for chemical warfare agents where the public information on the demand for
phosphorus is limited, and by our estimation the quantity of P
4
used annually in those
applications is relatively small.
In terms of market size, the relative importance of the different sectors is summarised in the
next two diagrams. Once again, data on phosphorus is very limited and sketchy at best. The
CRU estimates are based on available information from a variety of different sources as well as
previously completed client reports and projects. The first diagram below includes phosphorus
dependent derivatives only (excludes thermal phosphoric acids) with global use estimated at
357,000 tonnes P
4
in 2012.

The next diagram includes the larger thermal phosphoric acid market. The balance of all
phosphorus (P
4
) produced is used for the production of thermal acids. This includes a small
quantity of polyphosphoric acids which are also P
4
dependent, but the majority of acid produced
is 75 85% acid (i.e. up to 61.5% P
2
O
5
), which competes head-to-head in the market with
CRU STRATEGIES
Global Demand for Phosphorus Dependent Derivatives 2012
(357,000 of tonnes P
4
Excluding Thermal Phosphoric Acid)
Red Phos
3%
P
2
O
5
4%
PCl
3
68%
P
2
S
5
12%
Sodium Hypo
7%
Others
6%
Total Demand
=357,000
tonnes
L-18
14 CRU Strategies
purified wet-process acids (PPA). Thermal phosphoric acid is characterised by its high purity,
and this is essentially a consequence of the distillation which occurs during the manufacture of
phosphorus. Impurities that do remain in thermal phosphoric acid are typically at the ppm (parts
per million) level. In contrast, wet phosphoric acid contains a variety of impurities that result
from the impurities in the phosphate rock, and taken together these impurities are typically
present at the per cent (%) level. Since the 1980s technology for purifying wet phosphoric acid
has become increasingly important, and there are processes in place for purifying wet
phosphoric acid to a quality ranging anywhere from an upgraded fertilizer acid to that
approaching, or equal to, thermal phosphoric acid. Total phosphorus production in 2012 is
estimated to be about 1,001,000 tonnes P
4
, with around 644,000 tonnes of this P
4
converted into
thermal phosphoric acid.

1.3.3 P4 demand t o 2022
Overall, demand for phosphorus derivatives is growing; however, the demand for thermal
phosphoric acid is expected to decline. As a result, total global elemental phosphorus
demand will increase very modestly during this ten-year forecast.
A list of phosphorus uses was shown in section 1.3.2 above. Demand for phosphorus for
phosphorus dependent derivatives is estimated to have grown at about 4.5% CAGR (compound
annual growth rate) during the ten-year period from 2002 to 2012. Demand is changing for a
CRU STRATEGIES
Total Global Demand for Phosphorus - 2012
(1,000,000 of tonnes P
4
Including Thermal Phosphoric Acid)
Red P
1%
P
2
O
5
2%
PCl
3
24%
P
2
S
5
4%
Sodium
Hypo
3%
Thermal
Acids
64%
Others
2%
West
Europe
8%
East Europe
2%
North
America
11%
Central
America
0.2%
South
America
3%
Africa
1%
Asia
75%
Oceania
0.3%
By Region By Sector
L-19
CRU Strategies 15
variety of reasons including a population and economic growth and the development of new or
improved products, sometimes offset by substitution and environmental regulations.
x There will be reasonable growth for PCl3 derivatives driven by the expanded use of
herbicides (glyphosate), insecticides (diazinon), flame retardants, oil additives and
plastics.
x Tightening emissions standards for lube oils have moderated the demand for P2S5
but there is still potential for growth especially in China and the developing world.
x The growth in demand for computer hard disks has been strong for sodium
hypophosphite demand, but from a low base.
x Anhydrous P
2
O
5
growth has been increasing, driven by the growth in demand for
flame retardant products.
x There will be some growth in phosphate metal treatment on manganese, iron and
zinc as well as for metal surface cleaning, electroplating of copper and zinc and
electrolysis nickel plating.
Overall growth for phosphorus dependent derivatives is expected to increase at about 4.5% per
year through the forecast period, seeing demand grow from a 2012 estimate of 357,000 tonnes
to about 572,000 tonnes by 2022, a gain of about 215,000 tonnes of P
4
.
However, CRU is also forecasting that the volume of P
4
being converted into the larger thermal
phosphoric acid market, will drop from a current estimate of around 644,000 tonnes in 2012 to
498,000 tonnes by 2022 or about a 146,000 tonnes P
4
decline. The major reason for this decline
is substitution by purified phosphoric acid (PPA) with a continuing downward trend in STPP
use in detergents.
STPP was once considered to be the detergent builder of choice throughout the world, but
during past two decades or so it has faced challenges from alternative builders. Functionality
remains critical as part of the selection process, but other factors including cost/performance,
logistics, asset utilisation, availability, environmental compliance, and consumer purchasing
habits and trends all play a role in determining which builder is used in which brand. The two
most popular remain STPP and zeolite A.
STPP is considered by many to be the best builder in a powder-based detergent, but when it is
used in liquid and gel-based detergents, the advantages of STPP over other builders such as
zeolites are negligible. In recent years there has been a growing consumer trend away from
powders and compact powder tablets in favour of liquid and gel detergents. There are a number
of reasons for this:
L-20
16 CRU Strategies
x Consumers can use a more accurate dosage with liquid detergents for different
types and quantities of washing loads.
x Washing temperatures for liquid detergents tend to be lower, reducing domestic
energy requirements, and therefore household bills.
x Marketing and changing fashions have prompted an increasing number of
consumers to buy the more modern liquids and gel-based detergents.
Though more expensive, sales of liquid detergents have grown strongly, particularly in North
America and Europe, and the major global detergent manufacturers have also introduced liquid
and gel-based home laundry detergents (HLDs) to other world markets. The growth potential
for these types of HLDs is large since they have yet to filter through to much of the developing
world.
Concern over the effect of STPP on the environment has led to restrictions and bans in several
countries, and changing consumer habits in some areas have favoured alternative formulations.
Global detergent STPP demand has fallen by over 1.1 million tonnes product since 2007, due to
a combination of:
x further restrictions on phosphates
x reformulation of HLD by soapers
x economic downturn
Currently, less than half of global STPP demand is used for household laundry detergents.
Automatic dishwasher detergents (ADDs) account for around 15%, and the Industrial &
Institutional (I&I) market around 20%. The remainder of STPP demand is accounted for by its
application in food and other end-uses.
China is the worlds largest STPP producer, all of it based on thermal phosphoric acid.
However, the government and general population are becoming increasingly anxious about the
long-term problems caused by the pollution in Chinas rivers and lakes, and so further
legislative measures aimed at improving environmental conditions can be expected. It is not
currently known if any more provinces will undertake to restrict phosphate-based HLDs, but as
with the European Union and North America, an excess of phosphorus in surface waters is more
likely to be tackled by banning the use of STPP-containing detergents than by restricting the use
of phosphate fertilizers. The proportion of phosphate-free detergents in China will increase
inexorably, and CRU takes the view that China will have eliminated STPP use in HLDs in the
period to 2020. The level of dishwashers in China is relatively low, and we do not expect any
substantive increase in the use of ADDs during the forecast period. The I & I market, on the
other hand, should broadly track GDP growth. Overall, STPP demand for detergents in China is
L-21
CRU Strategies 17
expected to decline further in the next five years or so, and, thereafter, growth in I&I and ADDs
will help to stabilize STPP demand at the level of around 100,000 tonnes/a product.
China is also the largest export supplier of STPP. Chinese exports of STPP were of the order of
600,000 tonnes/a product in the 2006-2009 period, and represented a third of the global trade in
industrial & food phosphates. By 2012 Chinese exports of STPP had fallen to 257,000 tonnes
product, some 42% down from the peak level. The drop off was consistent with the 46%
decline in global trade which occurred in the same period.

CRU is forecasting global STPP demand in detergents and cleaners to show little growth over
the forecast period. Demand is projected to stabilize at around the level of 2 million tonnes/a
product, with an annual growth of around 1-2% driven by I&I and non-detergent applications.
Some growth in STPP demand in detergents is expected in the Middle East, South Asia, SE
Asia, South America, Central America and FSU. All other regions will experience further losses
in STPP demand in the period to 2020. Against this background, we do not envisage any
substantive increase in Chinese STPP export tonnage during the forecast period.
On the other hand, Chinese STPP demand in sectors other than detergents i.e. food applications,
water treatment, metal treatment is forecast to grow above GDP growth, and this will partially
compensate for the decline in STPP demand in HLDs. The overall decline in STPP demand is
expected to be of order of only 1% p.a. or less. Reduced demand for thermal phosphoric acid for
STPP production will be partially offset by higher consumption for food & beverages, metal
CRU STRATEGIES
STPP Exports 2000 to 2012
(million tonnes product)
0
0.2
0.4
0.6
0.8
1
1.2
1.4
1.6
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
m
i
l
l
i
o
n

t
o
n
n
e
s
China ROW World
L-22
18 CRU Strategies
treatment, water treatment and miscellaneous usages, which are all forecast to grow strongly
during the outlook period.
As regards total P
4
demand, the increased demand for P
4
for phosphorus dependent derivatives
will be mostly offset by the loss of demand for P
4
for thermal phosphoric acid. CRU is
forecasting that overall demand for P
4
will increase by a modest 0.7% per year. Should the
overall expansion of purified wet-process phosphoric acid capacity in China accelerate; there
could be a contraction in total P
4
demand. The opposite would occur if purified wet-process
phosphoric acid capacity were to remain flat.
This downside risk in demand is potentially significant. Regionally, most P
4
will be
manufactured and consumed in Asia either in the derivatives market or as a residual source of
thermal phosphoric acid in China. Demand for thermal phosphoric acid is forecast to decline at
a compound rate of 2.9% p.a. from 2012 to 2022 because of this substitution with PPA. Should
PPA production grow faster, the P
4
demand could even be lower.

It is also unlikely to be quite as smooth a transition as depicted in the diagram above. Solvent-
extraction purification phosphoric acid plants are likely to come on stream in large 100,000
tonnes P
2
O
5
increments, equivalent to about 44,000 tonnes P
4
from each plant (1 tonne P
2
O
5
is
equivalent to 0.4364 tonnes P
4
). The average annual decline in the forecast for thermal acid is
around 15,000 tonnes P
4
, and the forecast suggests the completion of roughly one new PPA
plant every two to three years. So the decline in thermal acid use is likely to be more lumpy
CRU STRATEGIES
Total global demand for phosphorus 2012 to 2022
(thousands of tonnes P4 including thermal phosphoric acid)
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Thermal Acid 783 686 664 652 644 636 624 612 596 579 563 546 530 514 498
Derivatives 292 302 312 344 357 352 365 384 404 426 450 476 505 537 572
0
200
400
600
800
1,000
1,200
000 tonnes
L-23
CRU Strategies 19
than the forecast, i.e. sharp declines followed by a year or more of flat demand, followed by a
further sharp decline.
CRU believes that PPA will continue to grow at the expense of thermal phosphoric acid.
1.3.4 P4 suppl y t o 2022
Only five countries now have active phosphorus (P
4
) capacity. These are China, Kazakhstan,
the Netherlands, the USA, and Vietnam. A very small yellow phosphorus plant may also be
operating in J apan and a small red phosphorus plant in India (not included). The estimate of
global capacity for these countries is shown on the diagram and table below.

Tabl e 1.3: Wor l d phosphor us c apac i t y 2012 (t housands of t onnes P4)

CRU STRATEGIES
Global phosphorus capacity 2012
(Share of 1.5 million of tonnes P4)
China
90%
Kazakhstan
3%
Netherlands
3%
USA
3%
Vietnam
1%
Total capacity = 1. 5
million tonnes
Country Company Location Type Capacity
Netherlands Thermphos Vlissingen Yellow 40
Kazakhstan Kazphosphate Dzhambul Yellow 60
USA Monsanto Soda Springs, Idaho Yellow 120
China Various Various Locations Yellow 1,300
China Various Various Locations Red 16
Vietnam SBCC Bao Thang, Lao Cai Province Yellow 13
World 1,549
L-24
20 CRU Strategies
Except in China where 90% of the worlds P
4
capacity exists, no new thermal P
4
plants have
been announced during the forecast period. By far, China is the main producer of phosphorus
worldwide. The total global capacity is estimated at 1.5 million tonnes of P
4
(3.3 million tonnes
P
2
O
5
). Production in China is estimated at between 800,000 to 850,000 tonnes in 2012. China
operates as the second supplier to the rest of the world, in particular to developed markets in
North America and West Europe for which Monsanto and ThermPhos, respectively, are the
prime suppliers. The outlook for thermal capacity is for an overall decline, centred on China and
the substitution of purified phosphoric acid (PPA).
x The Chinese Government has set a target of 600,000 tonnes of wet-process purified
phosphoric acid (PPA) to be produced in the country by 2012. This represents about
160,000 tonnes P
4
or 370,000 tonnes P
2
O
5
. This will result in slower growth in
thermal acid production. We do not believe this will happen at the timeline
proposed by the Chinese Government, but we do expect it to happen, albeit at a
slightly slower pace.
x This initial investment in wet process purification is the beginning and we could see
wet-process purification make even more significant gains in China, as it has
elsewhere around the world. As a consequence CRU expects to see P
4
demand for
thermal acid use decline by up to 360,000 tonnes P
4
during the next 10 years, equal
to nearly 770,000 tonnes P
2
O
5
.
x Elsewhere around the world the niche production of thermal acid for applications
where its additional costs are justified by the purity achieved, such as in electronics
grade phosphoric acid will continue to grow at good growth rates, but from a small
base year volume.
The first PPA plant in commercial operation in China was the Wengfus PPA plant in 2007,
which is based on Batemans technology, with a capacity of 140,000 tonne P
2
O
5
(equivalent to
61,000 tonnes of P
4
). Actual production varied from 50-65,000 tonne P
2
O
5
per year. Besides
Wengfus plant, there are three other PPA projects:
x SINOCHEM Fulings PPA project in Chongqing based on technology developed in
China. The designed capacity is 50,000 tonnes (equivalent to 22,000 tonnes of P
4
)
technical grade phosphoric acid commissioned in 2009.
x Liuguo Chemicals PPA project in Anhui was using technology provided by Fuling
and the scale is also 50,000 tonnes (equivalent to 22,000 tonnes of P
4
) technical
grade phosphoric acid.
x Wengfus project in Dazhou, Sichuan with a planned capacity of 150,000 tonnes
(equivalent to 65,000 tonnes of P
4
) was scheduled for 2011.
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CRU Strategies 21
Chinese fertilizer producers will likely invest in future PPA operations. However, PPA
production technology is still being developed and modified in China. Purification processors
will need to improve their quality by screening green acid and splitting the low quality acid out.
This lower quality acid can then be delivered to the fertilizer production units.
Yun Tianhua is believed to be the largest manufacture to produce yellow phosphorus in China.
Chinas yellow phosphorus is mainly distributed in Yunnan with 48%, Sichuan with 21%
Guizhou with 17% and Hubei with 12%.
1.4 Ex pec t at i ons br i ef i ng
Industrial phosphate demand is expected to grow both globally and in China. Until now, most
industrial phosphates in China have been produced by companies outside the fertilizer industry
by the thermal process. With the introduction of purified phosphoric acid (PPA) technology
using a wet-process phosphoric acid, competition between these manufacturing sectors will
increase. This has already occurred outside of China where P
4
capacity has been closed.
In China, most phosphorus producers use captive phosphate rock (the rock mine is owned and
operated by the phosphorus manufacturer), and plants that will be making PPA will also have
captive rock supply. While this PPA does not compete in the very high-purity phosphorus
dependent derivative market, PPA production can replace sales of thermal phosphoric acid to
industrial phosphate converters on the downstream side of this business.
CRU believes the real structural change in the industrial phosphate area will happen after 2015
when the cost advantages of PPA become more manifest. At a minimum, this will replace all of
the growth in the domestic market which would potentially belong to thermal phosphoric acid,
and depending on how rapidly it is adopted, PPA could also reduce thermal acid use from the
current base demand.
L-26
22 CRU Strategies

With relatively few formal projects at present, the supply forecast is somewhat speculative.
There are two issues that need to be taken into account:
x Possible capacity expansions in PPA, and
x Substitution of thermal acid for PPA.
There is no expectation, especially with Chinese thermal acid capacity, that supply will
constrain demand in any way. Therefore, the overall supply forecast will equal the demand
forecast.
The forecast was generated based on certain assumptions:
x Supply will equal demand
x New demand will substantially report to WPA and derivative PPA
x PPA capacity utilisation will not exceed 95%
x PPA production costs, even in China, will be lower than thermal acid costs.
Our overall opinion is therefore that Chinese thermal phosphoric acid will continue to be
produced for mainstream applications for the foreseeable future, but that growth in the supply in
China will be from PPA as opposed to thermal phosphoric acid. The principal drivers for
change will be the worsening economics of manufacturing using the thermal route, coupled with
CRU STRATEGIES
Rock PhosphateSalts Phosphorus(P
4
) ThermalAcid
IndustrialPhosphate Producer
Rock WetProcessAcid PurifiedWetAcid PhosphateSalts
FertilizerProducer
IndustrialPhosphate Producer
Rock WetProcessAcid PurifiedWetAcid PhosphateSalts
FertilizerProducer
Chinas current situation for industrial phosphate is with
phosphorus and thermal acid
In the Western World, the industry has adopted the PPA process
China is beginning to adopt PPA technology
The major question is not if PPA will be adopted but how fast
L-27
CRU Strategies 23
Government pressure for improved environmental performance and compliance. However, a
degree of inertia will be sustained owing to the low CAPEX (money spent to build, acquire or
upgrade plants) for thermal phosphoric acid, coupled with the significant interest current
producers have in existing capacity.
If thermal acid production is to decline as we expect or faster, i.e. manufacturing was only
maintained for applications such as electronics where thermal acid continues to be competitive;
then there would be further scope for investment in PPA beyond the 5 or 6 plants we speculate
about above.
A summary of the factors for and against the production of thermal acid are shown on the table
below.
Tabl e 1.4: Fac t or s f or and agai nst t he ongoi ng pr oduc t i on of t her mal
ac i d i n Chi na
Fac t or s For Ther mal Ac i d Pr oduc t i on i n Chi na Fac t or s Agai nst Ther mal Ac i d Pr oduc t i on i n
Chi na
x Technology for PPA is not widely available.
Conversely the technology for the production of P4
and thermal acid is widely available.
x The CAPEX required for PPA is higher than for
thermal acid. The cost of building a 100,000 tonnes
P2O5 PPA plant might reasonably be in the $50 - $70
million range depending on process, location etc.
The cost of building around 4 or 5 10,000 tonnes acid
towers (conventionally measured in terms of their P4
burning capability, i.e. between around 92,000 and
115,000 tonnes P2O5) might be in the range of $11 -
$14 million.
x The quality of raw materials for P4 production,
especially relating to phosphate rock, can be lower
than that required for PPA production. In addition,
China is currently a net importer of sulphur (for wet-
process production) whereas all the raw materials
needed for P4 production are available in China.
x The installed capacity and the financial
commitments many companies have to P4 and
thermal acid. Companies will want to maximise the
value of their investments, and will be reluctant to
move to PPA whilst prices still enable thermal acid to
be profitable.
x Environmental issues. P4 production has a number
of environmental problems associated with it in terms
of emissions to the atmosphere (CO), and to water
(phosphorus / heavy metal contamination from muds
and tailings ponds). To produce to world-class
standards will require significant additional CAPEX,
which increases fixed costs of production.
x Long term production costs. The variable costs of
thermal acid production will continue to rise, primarily
driven by the increased cost of power for P4
production. PPA production has low power needs,
and costs will go up at a much slower pace.
x Government Regulations. The Chinese
Government is not supportive of the P4 industry
overall, believing that it is not of strategic value, is
polluting, and absorbs valuable resources (power,
phosphate rock). So far the regulations have related
mostly to scale closing all furnaces below 5,000
tonnes initially, for example, but it is likely that more
operational regulations on emissions and
environmental compliance will be enacted. See
above.

L-28
24 CRU Strategies
Chapt er 2 Phosphat e r oc k r esour c es
Over 99% of commercial phosphates are extracted from phosphate rock, the exceptions being
small volumes of guano, some phosphogypsum for direct application, a pure phosphogypsum
for wall board and the phosphate content recovered from waste treatment and animal wastes. As
such, the availability of a consistent quality and a relatively low cost phosphate rock source is
critical to remaining competitive in the downstream phosphate marketplace. The availability and
suitability of phosphate rock depends both on the process and the intended downstream
products.
2.1 Avai l abi l i t y of phosphat e r oc k
The term phosphate rock can refer to any ore that contains recoverable quantities of phosphate
(compounds containing the PO
4
3-
ion). As indicated in Chapter 1, phosphate rock occurrences
can be divided into sedimentary deposits and igneous deposits according to their geological
origin.
Sedimentary phosphate deposits are the most common class of phosphate rock deposits and
include the deposits in China, North Africa and the Middle East. Typically, sedimentary
phosphate deposits occur as horizontal beds along with limestone, marls and clays. The large
phosphate deposits of Florida are also classified as sedimentary, though these can contain some
level of pebble deposits in the sedimentary beds.
Igneous phosphate deposits are found in certain intrusive complexes of alkali rocks. Unlike
sedimentary deposits, igneous phosphates generally occur as ring-like structures with a limited
area (generally less than 50km
2
). Commonly near the centre are veins and lobes called
carbonatites that are rich in carbonates (calcite, dolomite etc.). The apatite of economic interest
can be in the carbonatites or in the surrounding alkalic rocks. Igneous rock can require costly
grinding to liberate apatite crystals, unless the deposit is heavily weathered. Important igneous
phosphate rock deposits are found in Russia (Kola peninsula), South Africa, Brazil and Finland.
Currently, phosphate rocks recovered from igneous deposits have commercial importance,
particularly as a source of high-quality concentrate, but supply only a fraction of the world
market. Sedimentary phosphates, have been, and will continue to be, the major source of
commercial raw material for the phosphate industry.

L-29
CRU Strategies 25

2.1.1 Gl obal r eser ves
The long-term supply of phosphate rock will be determined by the size and location of reserves
that can be mined. Reserve estimates vary widely depending on the source. The traditional
definition of a reserve is the estimated volume that can be economically produced (reported in
tonnes of concentrate). The resource estimate includes the total volume that can be produced
without regard to costs or economics. Depending on the assumed market price, resources can
be moved into or out of the reserve base. CRU does not perform independent estimates of
reserves or resources. Published estimates are based on information provided by the host
country or the mining company which owns or leases the land. Many reserve estimates are not
comparable or even verifiable.
In 2010, the USGS (US Geological Survey) revised their estimate of phosphate rock reserves to
67.5 billion tonnes. This would represent more than 300 years of available reserves at the
current production rate. If accurate, there will be no shortage of phosphate rock in the
foreseeable future. The table below shows CRUs most recent estimates of reserves for each of
the major countries/regions based on this USGS data. There are additional phosphate ore
resources mineable at production costs greater than $100/t, but it is less likely that these
deposits would be considered for production until these lower costs reserves are fully
developed. Mining companies are most likely to mine their lowest cost and most easily
accessible deposits first.
CRU STRATEGIES
Phosphate rock deposits
active inactive active inactive
sedimentarydeposits igneousdeposits
L-30
26 CRU Strategies
Tabl e 2.1: Est i mat ed phosphat e r oc k r eser ves - 2012 (i n mi l l i on t onnes
of phosphat e r oc k at l ess t han US $100/t )

According to this data, Morocco has the largest volume of the worlds reserves, amounting to
over 50 billion tonnes. Morocco produced an estimated 25 million tonnes of phosphate rock in
2012 and at this production rate would have nearly 2,000 years of available reserves remaining.
In contrast, China and the USA produced larger proportions of world output but have smaller
estimated reserves. These two countries would have only about 50 years of reserve life
remaining.
It should be mentioned that 20% or more of these phosphate rock reserves could become off
limits due to established property rights or restrictive environmental concerns. Environmental
Region Tot al by Region Count r y Tot al by Count r y
Wor ld Tot al 71,833 71,833
West Europe 25 Finland 25
FSU (Former Soviet Union) 1,460 Kazakhstan 160
Russia 1,300
Africa 54,240 Algeria 2,200
Egypt 100
Morocco 50,000
Senegal 180
South Africa 1,500
Togo 60
Tunisia 100
Other Africa 100
North America 1,402 Canada 2
United States 1,400
Central America 30 Mexico 30
South America 570 Brazil 310
Peru 240
Venezuela 20
Middle East 10,050 Israel 180
J ordan 1,500
Saudi Arabia 770
Iraq 5800
Syria 1,800
South Asia 6 India 6
East Asia 3,700 China 3,700
Oceania 250 Australia 250
Other 100 Other 100
Dat a: CRU es t i mat es bas ed o n USGS dat a
L-31
CRU Strategies 27
concerns will become more important in the future as urban encroachment, with its increasing
demands for available water supplies, compete with mining companies for available land
resources.
2.1.2 Phosphat e r oc k qual i t y
The average grade of phosphate rock produced in the world was 31% P
2
O
5
(67.8% BPL) from
1976 to 2011 (see diagram below). BPL stands for bone phosphate of lime and has been
historically used as an alternative expression of the phosphate content of rock. The conversion
from percent to BPL is 2.185. High grade P
2
O
5
rock production from Russia was cut by nearly
30 million tonnes in 1991 and 1992 during the political turmoil of the breakup of the Soviet
Union, and this led to a sharp drop in the global average phosphate content of phosphate rock
produced. Since 1992, average rock grade has remained around 31% P
2
O
5
. Going forward, there
will be a slight reduction on the average P
2
O
5
content of phosphate rock produced around the
globe, although the fall will not be anywhere nearly as dramatic as that experienced over the
past 30 years.

While P
2
O
5
content is typically the benchmark by which phosphate rock is valued and priced,
there are a number of other factors that also determine quality. A minimum of 29% to 32%
P
2
O
5
is preferred, as there are obvious advantages connected to using a higher grade phosphate
rock. However, too much emphasis is often placed on phosphate content, and though it is a
headline indicator of the suitability/marketability of the rock, to some extent this emphasis
CRU STRATEGIES
28
29
30
31
32
33
34
%
P
2
O
5
Average global rock quality
L-32
28 CRU Strategies
derives from the fact that a higher phosphate content generally translates to lower impurity
contents (which in turn should mean high reaction efficiencies, less waste (gypsum) and fewer
processing issues (i.e. difficulties with ammoniation of phosphoric acid production due to
impurities). So, while the phosphate content is a good first indicator of the rocks potential
for processing and marketing, it is also important to look to the impurity contents.
Other rock attributes can also affect the design, capital costs and operating costs of the
processing plants. These qualities can be categorised as physical or chemical. Physical
properties of phosphate rock include temperature, particle size, crystallinity, and the effects of
treatment such as calcining. These characteristics affect the handling of the rock, reactivity with
acid and phosphate losses in processing. Chemical properties of phosphate rock include the
content of non-phosphatic mineral elements (both positive and negative to the overall quality),
inert mineral gangue and the presence of organic matter. There are a number of impurities
commonly found in phosphate rock deposits that can adversely affect its value, regardless of
P
2
O
5
content.
Each source of phosphate rock in the world is unique, and the different seams that constitute the
deposit can also have widely varying ore quality as shown in the table below. Because of this
variation in phosphate rock quality, the sourcing of phosphate rock is an important task for
phosphoric acid producers and the producers of other phosphate products. In most cases
phosphate rock buyers have established long-term supply agreements with rock producers, and
have adapted their downstream processing techniques to deal with the quality issues associated
with a particular source of rock. Those companies without secure sources of phosphate rock
often face production problems and tend to be less efficient due to the constant adjustments that
are required in order to produce a consistent final product.
2.1.3 PRC phosphat e r oc k deposi t s
The Chinese Government is committed to remaining self-sufficient in phosphates by
encouraging development of new phosphate rock projects. It is also working to improve the
efficiency of phosphate mining and conversion. At the same time the Chinese Government
implements a strict policy on exports with a quota system for phosphate rock and limiting
exports of upgraded phosphate products with very high in-season tariffs.
2.1.4 PRC phosphat e r oc k r eser ves
As shown on Table 2.1 above, China has an estimated 3.7 billion tonnes of phosphate rock
reserves. Ore containing above 65% BPL (30% P
2
O
5
) has been shrinking and represents an
estimated 10% to 25% of the current reserves, depending on the source. Operators are now
working the lower 20% to 25% ores. The average grade of Chinas reserve base is estimated at
below 20% P
2
O
5
. The exploitation of lower grade ores will increase production costs because of
L-33
CRU Strategies 29
the additional volume that must be handled to extract a tonne of P
2
O
5
as well as the need for
additional beneficiation steps.
According to the China National Chemical Information Centre, at of the end of 2009, there were
457 mines producing phosphate rock in China with 76 large-scale (over 250,000 tonnes) mines
and 155 medium-scale (between 100,000 to 250,000 tonnes) mines. They were distributed in 19
provinces, cities and autonomous regions. However, they were concentrated mainly in Yunnan,
Guizhou, Hubei and Sichuan.

The same areas that currently mine rock are those with the highest reserves. According to the
China Statistical Yearbook, reserves are mainly in Yunnan, Guizhou, Sichuan, Hubei, and
Hunan provinces which together account for about 2.9 billion tonnes or 81% of the total.
CRU STRATEGIES
Current phosphate rock mines in China by Province
Yunnan
27%
Hubei
31%
Guizhou
24%
Sichuan
9%
Hunan
7%
Other
2%
L-34
30 CRU Strategies
Tabl e 2.2: Est i mat ed phosphat e r oc k st at i st i c s f or Chi na by pr ovi nc e
(bi l l i ons of t onnes)

With Chinas reserves, the main issue for future phosphate rock supply could be the quality of
the rock and not the volume. Investment in beneficiation technology will be necessary and
expensive, which suggests future mines will be larger and likely integrated with downstream
phosphate products. Some smaller rock mines will be closed.
2.1.5 PRC phosphat e r oc k qual i t y
The diagram on page 28 shows that the average P
2
O
5
content for phosphate rock has been
declining and has averaged below 31% (67.8% BPL) for the last five years. Rock grade is
important as it is an indication of lower impurity levels and often translates into lower waste
disposal and lower production costs.
The table below show the typical composition of some important elements and compounds
contained in phosphate rock after beneficiation for the major manufacturers.
Tabl e 2.3: Typi c al c omposi t i on of sel ec t ed phosphat e c onc ent r at es

At first glance, most Chinese rocks are within the desirable limits. Some Chinese rocks display
high Silica and Cadmium levels but should be acceptable for thermal phosphorus
Province Reserves 2012 Mi ne Capacity 2012 Mine Production
Yunnan 0.8 26.0 25.0
Guizhou 0.7 19.0 18.0
Hubei 0.7 30.0 28.0
Hunan 0.3 5.0 1.0
Sichuan 0.3 7.0 6.0
21 Other Provinces 0.7 3.0 2.0
Total Chi na 3.6 90.0 80.0
Data: CRU estimates
Country %BPL %P
2
O
5
CaO MgO SiO
2
R
2
O
3
C F Cl Cd
China 61-76 28-35 46-55 0.1-3.0 3.0-12 1.8-2.0 Variable 2.0-4.0 100-190 <2
Russia 81-87 37-40 50-51 0.1-3.5 1.2-1.7 0.7-1.6 Low 1-2.9 Low 1-7
Brazil 76-81 35-37 48-52 0.1-0.8 1.0-2.5 0.7-7.3 Low 1.1-2.6 30-400 2-3
Morocco 62-80 28-37 50-52 0.1-0.5 1.5-5.7 0.3-0.8 0.1-0.3 3.6-4.1 20-600 20-35
Togo 78-81 36-37 48-51 0.1-0.2 4.0-4.5 2.1-2.6 Low 3.6 300-600 40-50
Algeria 61-76 28-35 50-54 0.8-1.9 1.7-2.2 0.8-1.7 High 3.5-4.0 High 16
Tunisia 61-70 28-32 48-50 0.6-1.0 2.9-3.3 0.8-1.2 High 3.6 700 16-40
Israel 70-74 32-34 51-53 0.2-0.3 1.3-1.5 0.2-0.4 0.2-6.6 3.6-3.8 400 30
J ordan 68-74 31-34 50-52 0.2-0.3 3.0-6.4 0.5-0.6 Low 3.5-3.8 300-450 4.6
USA 66-72 30-33 44-52 0.4-0.9 3.0-12 0.6-3.0 0.2-2.9 3.1-4.5 Low <2
Data: KEMWorks, CRU & literature search
Typical composition %w
L-35
CRU Strategies 31
manufacturing. Comparisons to other rocks can be misleading as wide variations can exist and
some sellers and buyers blend different rocks to obtain a desirable grade. Also, in addition to
chemical differences, physical properties are also important like particle size and crystal
structure. The quality of Chinese reserves may be lower but beneficiation technology can be
used to make this rock acceptable for manufacturing phosphorus, phosphoric acid and other
phosphate products.
Below is a list of such impurities as well as rough guidelines to indicate typical/acceptable
levels of these impurities of acidulation quality phosphate rock.
x P
2
O
5
content: Minimum of 29% for WPA production under common practice,
though preferably 32% or above. A high grade rock yields higher grade acid and
generates less waste (gypsum). In addition, the higher the phosphate content of the
rock, the lower the transport, handling and processing costs per tonne of phosphate
nutrient. High phosphate content is also likely to imply lower levels of unwanted
impurities.
x CaO:P
2
O
5
ratio: Below 1.55:1 is preferred (this is the indicator of both of
sulphuric acid consumption and generation of phosphogypsum in WPA
production). However, low ratios may indicate significant levels of non-apatitic
minerals, which can present other difficulties.
x Silica: This is not particularly deleterious, though it obviously acts as a diluent and
impedes grinding. It can be quite abrasive (and thus erode plant equipment), but it
can also aid in the removal of fluorine. Below 5% is preferable, but can be as high
as 9-10% without causing significant problems.
x R
2
O
3
(Fe
2
O
3
and Al
2
O
3
): These oxides can suppress ammoniation of phosphoric
acid (in the production of DAP/MAP). 5-6% is acceptable for superphosphates
production, but for high-analysis products it is preferably below 2%. Levels above
about 3% can begin to cause sludge problems when storing phosphoric acid.
x MgO: High magnesium content causes similar difficulties to high iron and
aluminium content. For phosphoric acid production, magnesium should not exceed
1.5%; the tolerance is lower (<0.25%) for the production of liquid fertilizers based
on superphosphoric acid as magnesium oxide raises the viscosity.
x F: Fluoride is deleterious and should not exceed 3-4%. Fluorides generate insoluble
precipitates during ammoniation of phosphoric acid. However, fluorides in
phosphate rock can be removed during the WPA preparation process.
L-36
32 CRU Strategies
x Cl: Chloride is problematic due to corrosion, so levels below 200-300 ppm are
preferable. The use of more corrosion-resistant materials allows for processing rock
with higher Cl content. Rock with Cl content of even 2,000ppm is utilised in WPA
manufacture, but it is sold at a substantial discount to few buyers.
x Heavy metals: Phosphate rock can contain a variety of heavy metals, but the most
important is cadmium. Some countries have introduced regulations governing the
amount of cadmium in fertilizers, but these have not been widely adopted. As such,
low-cadmium (<5ppm) can command a premium.
x Organics: Organic material causes foaming problems in the WPA production
process, as well as clogging of filters. It also can result in discoloration of the end-
products (black). Easily resolved by calcination. Carbon content below 1% is
preferred, ideally below 0.2%.

L-37
CRU Strategies 33
Chapt er 3 Chi nas phosphat e
i ndust r y
China is the worlds largest producer and consumer of phosphate rock and phosphates. Chinas
estimated 3.7 billion tonnes of phosphate rock reserves are second only to Morocco. In addition
to supplying all of its domestic demand, China is also a major exporter of upgraded phosphate
products as well as phosphorus derivatives, but yellow phosphorus exports are minimal. While
most of Chinas phosphoric acid is manufactured by the more conventional wet-process route,
Chinas is also the worlds largest manufacturer of thermal phosphoric acid made from P
4
.
3.1 PRC phosphat e r oc k pr oduc t i on by pr ovi nc e
Reliable and timely data for China is improving but is still subject to revision. Annual data for
China is published and generally reliable; however, data by province is not current. The most
recent phosphate rock production data by province is for 2009.
The phosphate rock deposits in China are in the south central and south east provinces. The
downstream phosphoric acid capacity is mostly located in these same provinces which include
Yunnan, Guizhou, Sichuan, Hubei and Shandong.

CRU STRATEGIES
Shandong
Hubei Sichuan
Yunnan
Guizhou
Hunan
Hebei
Shaanxi
Jiangsu
Anhui
MONGOLIA
BURMA INDIA
NEPAL
BANGLADESH
NORTH
KOREA
Current phosphate rock mines in China by Province
L-38
34 CRU Strategies
CRU is forecasting that China will produce about 78.2 million tonnes of phosphate rock in
2013, about 41% of the worlds total. One of the challenges for China is that while most of the
mines are legal, a number of smaller mines are not and production is generally under-reported
by several million tonnes. The provincial breakdown of production capacity and CRUs
forecast of production for 2012 is shown in Table 2.2. Preliminary data indicates that 2012
production was 77.5 million tonnes, but the provincial breakdown for 2012 is not available as of
yet.
Hubei: Phosphate rock production was expected to be 28.0 million tonnes in 2012. Hubei
phosphate rock is generally low-grade and comes from smaller mines. Total capacity is
estimated at around 30 million tonnes from at least 32 different mines identified by CRU. The
Hubei Government issued a circular indicating that it will close phosphate rock mines of less
than 150,000 tonnes annual capacity and will forbid construction of new capacity for low-
content phosphate fertilizers or yellow phosphorus. The goal is to have targeted growth. Six to
ten mines fall into this category of less than 150,000 tonnes.
At present there are five major (over 1 million tonnes) phosphate mines in Hubei. Two are
owned by China Blue (formally CNOOC) with a 1.5 million tonne mine at Dayukou Chemical
(DYK) and a 1.0 million tonne mine at ZHJ mining. The other large existing mines are Hubei
Xingfa Group and Hubei Yihua Group with a capacity of 2.0 million and 1.2 million tonnes,
respectively. And a 1.2 million tonne mine is owned by Hubei Huangmailing Phosphate
Chemical Industry Group.
The largest increase in new capacity is expected in Hubei Providence where over 10 million
tonnes of new capacity is planned. According to China National Chemical Information Centre
and other CRU sources, a number of major new phosphate rock mines are planned in Hubei
over the next five years.
Considering all potential projects, 2022 phosphate rock capacity in Hubei could increase to 40.0
million tonnes per annum.
Yunnan: This is the second largest phosphate rock producer in China with an estimated 25.0
million tonnes production forecast for 2012. Phosphate rock production in Yunnan is mostly
open-pit mines and generally higher grade. CRU can identify sixteen phosphate rock mines,
including three major operations. The total capacity of the province is thought to be around 26.0
million tonnes. This includes 10.0 million tonnes of capacity by the state-owned Yunnan
Phosphate Chemical Company (Yuntianhua International).
New mining capacity of 4.5 million tonnes is planned by Yunnan Phosphate. By the end of the
outlook period, provincial capacity could increase to 30.0 million tonnes per year.
L-39
CRU Strategies 35
Guizhou: Phosphate rock production in Guizhou was expected to reach 18.0 million tonnes in
2012. This rock is generally high-grade and ideal for high analysis phosphate products. Guizhou
province is thought to have a total capacity of 19 million tonnes with ten mines identified by
CRU.
The State-owned Guizhou Kailin Group has 5.0 million tonnes of capacity. All of its phosphate
rock is used internally at its downstream P
2
O
5
plants. There are three underground mines in the
Kaiyang district and two others at the nearby Shabatu district. This high grade rock does not
require beneficiation and is estimated at 33% P
2
O
5
(72% BPL).
The state-owned Guizhou Wengfu has 4.5 million tonnes of capacity and its concentrate output
is estimated at 33% P
2
O
5
(72% BPL) after floatation. Guizhou Wengfu is vertically integrated
and concentrate is used internally. By 2022, total capacity in Guizhou Province is expected to
grow to about 22.0 million tonnes.
Sichuan: Phosphate rock production in Sichuan is generally low-grade and comes from smaller
sized mines. CRU estimates that production will equal 6.0 million tonnes in 2012. CRU can
identify nine mines in the Province with a total of 7.0 million tonnes of capacity. Sichuan has
two 1 million tonne mines, the Sichuan Qingping Phosphate Mine and the Sichuan J inhe
Phosphate Mine. There are at least seven other mines of between 10,000 tonnes and 800,000
tonnes. Overall, phosphate rock capacity in Sichuan could increase to 10 million tonnes in 2022.
A new 3 million tonnes mine in the Mianyeng area of Sichuan province by Chengdu Koyo
Chemical Co. Sichuan Chemicals Industry Holding (Group) Ltd. is being planned. This project
is set to construct 1.2-2 million tonnes mining and mineral processing plant with 600,000 tonnes
of ammonium phosphate capacity, but currently no completion date has been set. Shandong
Xianglong Group, and Sichuan Sindoo entered agreements with Leibo County to construct three
projects totalling 1 million tonnes of ammonium phosphates and 60,000 tonnes of yellow
phosphorus in total.
Other: Apart from the major four provinces, the next biggest provincial capacity is 5.0 million
tonnes in Hunan with production of 1.0 million tonnes in 2012. New capacity is also planned in
a number of other provinces.
L-40
36 CRU Strategies
3.2 The phosphat e i ndust r y i n t he PRC
The manufactured phosphate products with an estimate of relative phosphate rock consumption
for each are shown below.
Tabl e 3.1: Chi na phosphat e pr oduc t i on & phosphat e r oc k c onsumpt i on
(mi l l i ons of t onnes of P2O5 and r oc k )

Many of the phosphate consumers are backward-integrated into phosphate rock. Capacity
estimates by company are maintained by CRU but because so many companies are owned by
larger holding companies and because so many are State-owned, information is difficult to
verify, especially for phosphate rock mines and phosphorus derived products. The largest will
be reviewed in Chapter 4.
The structure of Chinas phosphate industry is similar to that of the world except for a few
important differences. One major difference is that China is the worlds largest manufacturer of
4
) and therefore a larger share of its phosphoric acid production is from
thermal acid. A higher production of SSP and use of direct application phosphate rock are also
interesting to note. Overall, the Chinese market is moving towards more complex phosphate
products based on wet-process phosphoric acid and is just making this switch a little later than
most developed countries.
As stated earlier, the China National Chemical Information Centre reported that there were 457
phosphate rock mines. CRU believes that there are many small unreported mines and the actual
number could be closer to 1,000. The Information Centre also reported there were 76 large-
scale and 155 medium-scale mines. These numbers appear reasonable. As indicated above,
CRU believes Chinas phosphate rock production will reach 78.2 million tonnes in 2013 with a
mine capacity of 84.9 million tonnes and an implied operating rate of 92%. The CRU capacity
estimates may be low because of the hundreds of small unreported mines.
Production 2012(e) 2022(f) 2012(e) 2022(f) 2012(e) 2022(f)
Wet Phosphoric Acid (includes PPA) 17.0 20.0 58.0 66.0 73% 76%
Thermal Phosphoric Acid (P
2
O
5
) 1.7 1.7 10.0 10.0 13% 12%
SSP 3.0 3.0 10.0 10.0 13% 11%
Other Phosphate Rock Consumers* 0.5 0.3 2.0 1.0 1% 1%
Total Production/Consumption 22.3 25.0 80.0 87.0 100% 100%
(e) estimated (f) forecast
Note: * Includes direct application phosphate rock, fused magnesium phosphate, dicalcium phosphates for animal feeds,
additional rock in TSP, some non-fertilizer phosphate products, losses and unaccounted.
P
2
O
5
Phosphate Rock Share of Total Rock
L-41
CRU Strategies 37
CRU maintains plant lists for phosphoric acid (both thermal and wet-process) and the major
downstream phosphate products DAP, MAP and TSP. Even with an office in China, compiling
and verifying the names and capacities of each of these plants (and mines) is a major challenge.
Chinas P
4
capacity is estimated by CRU at 3.3 million tonnes P
2
O
5
(1.5 million tonnes of P
4
) at
the end of 2012. Production in 2012 of P
4
in China is estimated at 1.7 million tonnes of P
2
O
5

(0.8 million tonnes of P
4
). The total number of P
4
plants is believed to be over 100. This would
give an implied operating rate of just over 51%. It is possible that some of these plants (many
have 2 or more furnaces) have reduced capacity or are even closed.
Chinas thermal phosphoric acid plant capacity is estimated at 3.1 million tonnes P
2
O
5
and the
wet-process capacity is 17.0 million tonnes P
2
O
5
in 2012 (Table 3.1). The number of thermal
acid plants is estimated at 80 with an estimated production of 1.3 million tonnes of P
2
O
5

(requiring 0.6 million tonnes of P
4
). The wet-process plants number about 150. The CRU
production estimate will be about 15.6 million tonnes in 2013 for an implied operating rate of
92% for wet-acid compared to just under 50% for thermal acid.

Most phosphate consumption in China is in the Northeast, Northwest and Northern China
regions during spring and autumn, as there are two ploughing seasons in a year. Besides the
replacement of low nutrient fertilizer products like SSP and FMCP, the application of a modern
fertilization system and machinery also improved the use of high quality fertilizer products like
DAP and NPK.
CRU STRATEGIES
XinjiangAR
TibetAR
Qinghai
Gansu
Sichuan
Yunnan
Guizhou
Hunan
GuangxiAR
Hainan
Ningxia
AR
Guangdong
Jiangxi
Fujian
Chongqing
Hubei
Anhui
Zhejiang
Jiangsu
InnerMongoliaAR
Heilongjiang
Jilin
Liaoning
Shaanxi
Shanxi
Henan
Hebei
Shandong
HongKongSAR
Macau SAR
Tianjin
Shanghai
Beijing
Mongolia
Taiwan
Major phosphate markets in China by Province
L-42
38 CRU Strategies
DAP plants indicated that the production was more centred in southwest provinces.

3.3 Hi st or i c al r evi ew of r egul at i ons & pol i c i es
This is a broad subject and could cover everything from mining, manufacturing, transportation,
health, safety and the environment. This report will present a brief overview of the regulations
and policies that may impact the supply and demand for phosphates in China.
The Chinese government hopes to improve phosphate rock supply in the long term by
increasing capacity, increasing production, restricting exports and improving the utilisation rate.
On the supply side, the Chinese government has passed a number of regulations for carbon
emissions to reduce the countrys reliance on fossil fuels. Stricter environmental legislation is
also anticipated. These will result in higher energy costs for industry that will eventually be
passed on to the consumer.
China is also concerned about the depletion of its phosphate resources and ensuring that
phosphate is available to domestic markets. China Chemical Mining Association (CCMA)
released a Plan for the Development of Chemical Mining Industry in the Twelfth FiveYear
Plan Period (2011-2015). According to the plan, approved in March 2011, China will establish a
phosphate resources stockpile system in the countrys phosphaterich areas, establish entrance
standards for the phosphate rock industry, and raise the minimum scale and the threshold for
phosphate mining at new phosphate mines.
CRU STRATEGIES
Location of DAP plants in China by Province
L-43
CRU Strategies 39
The China Chemical Mining Industry Association is also recommending that the resource tax
rate on phosphate rock be changed. The resource tax is apparently a fixed amount, regardless of
the grade or quality of the phosphate rock. According to this group, this policy encourages the
use of high grade rock while wasting or ignoring low grade rock, but there seems to have been
little support from the authorities in this matter so far.
Also on the supply side, strict export license and tariff regulations were passed to limit access
to the international markets. Licenses are issued for phosphate rock suppliers that limit the
volume available for export. From 2009 to 2011, the annual quota for phosphate rock exports
has been 1.5 million tonnes. Companies that apply for an export permit must agree to be legally
registered and hold a mining license. In 2012 the quota was reduced to 1.2 million tonnes and
for 2013 it has been set at 1.0 million tonnes. As a result, Chinas phosphate rock exports have
been reduced from 4.9 million tonnes in 2001 to 0.4 million in 2012. This program is expected
to continue into the future.
For the converted phosphate products, tariffs have been used to limit exports. In J une 2007, the
Chinese Government introduced tariffs on DAP exports for the first time. Since that time, the
tax policy has been expanded to include all phosphate fertilizers. The Chinese Government
retains the right to publish further changes as needed. The success of this program is
questionable as overall phosphate exports increased from 2.0 million tonnes P
2
O
5
in 2009 to a
record 3.4 million tonnes in 2011, declining slightly to 2.9 million tonnes in 2012. Long term,
we believe, this program will continue and undergo continuing modification to reign in
phosphate exports.
On the demand side, there are on-going concerns about phosphate run-off from fertilizer and
animal wastes plus the continuing concern surrounding the reduction or elimination of
phosphates in detergents. These two are related stories as they are both about the loss of
phosphates into the environment and the possible eutrophication of fresh water lakes and
reservoirs from elevated phosphate levels. Both of these issues are having and will continue to
have a negative impact on phosphate demand. Our sense is that voluntary actions are occurring
but as yet no central government regulations have been enacted.

L-44
40 CRU Strategies
Chapt er 4 Chi nas c ompet i t i ve
over vi ew
This chapter will provide a brief review of the competitiveness of phosphate rock and P
4

production in China.
4.1 Compet i t i ve c ost s f or phosphat e r oc k & P
4

In 2011, CRU released its Phosphate Rock Cost Report that estimates production costs at the
mine and delivery costs to a captive conversion plant or the local export port. Shortly
afterwards, the Phosphate Fertilizer Cost Report was published in 2012. These reports are the
basis for this overview. These CRU reports represent several hundred hours of mine and plant
tours, reviews of available public and private data sources, and preparation. After all of this, we
recognize that this is not, nor was it intended to be, a benchmark study. The purpose of our cost
model is to allow production costs for all producers to be calculated in a consistent and logical
manner and to present fair and objective comparisons. These CRU reports were for phosphate
rock, phosphoric acid and the downstream products DAP, MAP and TSP. P
4
is not included in
these cost reports.
The single most important physical factor in determining the cost of phosphate rock mining
operations is the volume of material that must be excavated per tonne of product.

L-45
CRU Strategies 41
CRU STRATEGIES
Di agr am 2.10: Si t e Cost s Cost -Cur ve (2010 Capac i t y)
0
10
20
30
40
50
60
70
80
90
100
0 10 20 30 40 50 60 70 80 90 100 110 120 130 140
U
S
$
/
t
million tonnes phosphate rock
South-eastern USA MENA China CIS Other
Phosphate rock site costs 2010
(US$/tonne of phosphate rock)
Data: CRU Phosphate Rock Cost Model Note: estimated at 100% operating rate

The low cost phosphate rock producers are primarily in the south-eastern USA and the MENA
countries of Morocco and Tunisia. Chinas large Guizhou Kailin mine at Kaiyang has the
lowest costs of the Chinese mines reviewed but are in the borderline between the second and
third quartiles globally.
Site costs for the production of phosphoric acid cover a very large range, driven primarily by the
cost of raw materials. In 2012, when the average price of sulphur was $185/t (FOB Vancouver),
acid producers with access to a captive source of phosphate rock generally had site costs in the
range of $400-$600/t P
2
O
5
. At the lowest end of the cost curve is OCP J orf Lasfar, Incitec Pivot
Phosphate Hill and several sites in Florida. Capacity in the Middle East, North Africa and the
United States dominate the first and second quartiles.
Although we have estimated that Kailins operations in China (that use high-quality rock)
have site costs under $460/t, most Chinese phosphoric acid capacity, even with captive
phosphate rock, falls in the third quartile. However, because the market price of rock in
China is below international levels, non-captive producers have site costs in the range of $590-
660/t P
2
O
5
, which is much lower than non-captive producers elsewhere in the world. While
these costs will change over time, future costs will continue to favour the downstream
manufacturer with a captive phosphate rock source.
L-46
42 CRU Strategies
CRU STRATEGIES
Phosphoric acid site costs, 2012
(US$/tonne P
2
O
5
)
Data: CRU Strategies
0
200
400
600
800
1,000
1,200
0 5 10 15 20 25 30 35 40 45
C
o
s
t
s

(
$
/
t
)
Cumulative production (mt)
0
200
400
600
800
1,000
1,200
0 5 10 15 20 25 30 35 40 45
C
o
s
t
s

(
$
/
t
)
Cumulative production (mt)
CumulativeproductionmilliontonnesP
2
O
5
MENA USA & Canada China CIS India & Pakistan ROW

Raw-materials for P
4
production are between 8 to 10 tonnes of low grade phosphate rock per
tonne of P4, along with 1 to 2 tonnes of silica and 1 to 2 tonnes of coke. At first, this volume of
rock may appear high but considering that 0.4364 tonnes of P
4
equals 1.0 tonnes of P
2
O
5
, about
2.3 tonnes of P
2
O
5
are in one tonne of P
4
. Since many P
4
manufacturers use a lower grade rock,
without losses, it would require over 9 tonnes of 25% P
2
O
5
rock per tonne of P
4
.
4.2 Maj or gl obal P
4
c ompet i t or s
There is a short list of P
4
competitors outside of China as the table below shows. P
4

manufacturers inside China number over 100, many are very small with less than 5,000 tonnes
output. Of the four outside of China, only Kazphosphate and Monsanto have captive
phosphate rock. Within China, the number of captive rock producers is less clear since most
producers have relatively small requirements which could be obtained from a small
unauthorized mine.
L-47
CRU Strategies 43
Tabl e 4.1: Wor l d phosphor us c apac i t y 2012 (t housands of t onnes P4)

As indicated a number of times in this report, raw material costs are the most important factor
determining the competitiveness of a mine or plant. For the phosphate manufacturer, its the
costs of the phosphate rock. What our research has shown time and time again, is that those with
captive phosphate rock are always at the low end of the cost curve.
4.2.1 P4 c ompet i t or s out si de Chi na
Monsanto is the only phosphorus manufacturer in North America. They have three furnaces at
Soda Springs, Idaho with a capacity estimated at 120,000 tonnes P
4
. Monsanto consumes most
of its production to manufacture the herbicide Roundup. The phosphate rock is supplied from its
1.3 million tonnes Enoch Valley, Idaho mine (a 99% owned subsidiary P
4
Productions LLC).
This mine could supply all of the companys rock requirements at P
4
capacity; however, it is
believed the plant operates at between 70% to 75% of capacity.
CRU did not perform a cost profile on this mine, but since other western USA mines were
reviewed, the cash production costs can be estimated to be between $70 to $80 per tonne.
Despite above average phosphate rock costs, Monsantos P
4
production is cost competitive
because it is used internally to make a high value and very popular herbicide that is
manufactured and sold throughout the world. It also sources additional P4 as a raw-material for
manufacturing Roundup at other locations outside the company where its own P4 is less
competitive.
Thermphos is the only phosphorus manufacturer in Western Europe, but on 21 November
2012, the district court of Breda declared the company bankrupt. This means that after 44 years,
the production of phosphorus in Vlissingen has come to an end, at least for now.
This plant has 3 furnaces and is located in Vlissingen, Netherlands. This plant has a capacity of
about 40,000 tonnes P
4
. The company produces white phosphorus (yellow) and converts this
into derivatives, such as chlorides, sulphides and phosphoric acid at its downstream facilities in
Europe and South America. One of the private owners also has an interest in the phosphorus
plant in Kazakhstan.
Country Company Location Type Capacity
Netherlands Thermphos Vlissingen Yellow 40
Kazakhstan Kazphosphate Dzhambul Yellow 60
USA Monsanto Soda Springs, Idaho Yellow 120
China Various Various Locations Yellow 1300
China Various Various Locations Red 16
Vietnam SBCC Bao Thang, Lao Cai Province Yellow 13
World 1549
L-48
44 CRU Strategies
The source of the phosphate rock is unclear but it is imported. The rock requirements of up to
350,000 tonnes would be delivered under contract at the prevailing market prices (delivered
price over $172 per tonne in 2012). Although purchased phosphate rock costs are high,
Thermphos manufactures and markets these derivatives throughout the world. Its phosphorus
business is profitable but margins have eroded because of high raw-material costs. It also
sources P
4
from outside the company where its internally manufactured P
4
is less competitive.
Kazphosphate is the only phosphorus manufacturer in the Former Soviet Union. The 4
operating furnaces are located at Taraz, Kazakhstan with a combined capacity of 60,000 tonnes
P
4
. The low grade (20% - 21%) phosphate rock is produced from the nearby Karatau mine. The
estimated cash production cost for the rock is about $40 per tonne delivered by rail. The
relatively low cost rock only requires crushing and screening. Low cost phosphate rock should
result in relatively low P
4
production costs but the plant has been plagued with high power costs
and operating issues resulting in reduced production rates. It is working to obtain financing to
correct the problems at the plant and if successful, operating rates would increase.
SBCC (Southern Basic Chemicals Company) is the only phosphorus manufacturer in Vietnam.
This plant is located at Bao Thang, in Lao Cai Province with a capacity of 13,000 tonnes P
4
.
The company is a member of the Vietnam National Chemical Group. The rock is likely sourced
from a domestic mine. The P
4
is used to make pesticides and STPP.
4.3 Maj or PRC P
4
c ompet i t or s
Large-scale phosphate rock mining in China is a relatively new activity. During its early years
there was a plentiful supply of high-grade rock (>29% P
2
O
5
) that required no additional
treatment except crushing and screening. However, in the last decade, run-of-mine grades have
fallen and wet beneficiation has become more widespread. Ore containing 26-28% P
2
O
5
may be
sufficiently upgraded by washing and de-sliming, while lower grade ore also requires flotation.
This wet beneficiation is only necessary to produce concentrate suitable feedstock for wet-
process phosphoric acid plants; as lower quality ore may be sold without significant upgrading
for other uses, such as the production of yellow phosphorus.
Mines in China vary greatly in capacity from a few thousand to several million tonnes per
annum. However, the Chinese government is attempting to consolidate smaller operations, and
is preventing new mines from opening without attendant downstream capacity. New mines in
China will be in the region of 500,000tonnes or bigger. While there are differences in the cost of
inputs across the four principal phosphate-producing provinces (labour rates are highest in
Sichuan, lowest in Yunnan; coal prices are highest in Hubei, lowest in Sichuan), the main
difference in cost of production between different mid-sized operations is the nature of the
operation itself. The lowest cost mines are those that work a high-grade surface deposit and can
L-49
CRU Strategies 45
sell ore without beneficiation. However, many operations now wash and de-slime ore, and use
of flotation is becoming increasingly common. These wet beneficiation processes add $10-20/t
to site costs. Underground mining carries a further $15-20/t cost. Mines that work ore bodies
containing 10-20% P
2
O
5
must not only mine a large quantity of ore per tonne concentrate, but
must also employ multiple stages of flotation to achieve adequate upgrading.
On December 26
th
, 2011, the Ministry of Industry and Information Technology of the PRC
(MIIT) published a list showing Yellow Phosphorus enterprises with their 2010 capacity and
output for the four largest provinces. A list of Chinese P
4
producers is seen in Table 4.2 with
profiles of some of the major producers shown below:
Yunnan Phosphorus Chemicals Group (YPC) manufactures phosphate rock (8.5 million
tonnes), yellow phosphorus (10,000 tonnes) and phosphorus chemicals. It is part of the
Yuntianhua Group (YTH). The web site is www.chinaypc.cn. The web site says 10,000 tonnes
of yellow phosphorus while the MIIT data shows 80,000 tonnes. These differences may be
because of the other companies belonging to the YTH. YTH is a State-owned company and
believed to be the largest phosphate and phosphorus manufacturer in China. The company is
fully integrated from phosphate rock to downstream phosphate fertilizers and industrial
products. Their phosphate and phosphorus operations are in Yunnan province. The company has
a complex ownership structure and the phosphorus products appear to be part of the Malong and
Tianchuang companies with a number of plants in Yunnan province including plants at Anning,
Malong, Tianchuang and Xuanwei. With lower grade, run of mine rock available from their
captive mines and their large operating P
4
and downstream capacity, YTH is a very competitive
manufacturer of phosphorus. They will also develop PPA technology as needed for future
expansion.
Yunnan Malong Industry Group produces yellow phosphorus with a reported capacity of
60,000 tonnes. The company is a subsidiary of Yunnan Coal and Energy and is traded on the
Shanghai exchange (600792). The company sells yellow phosphorus. CRU believes this
company buys phosphate rock.
Yunnan Chengjiang Dean Phosphorus manufactures phosphorus with a capacity of 38,000
tonnes of yellow phosphorus, 128,000 tonnes of phosphoric acid, STPP and other phosphorus
chemicals. The web site is www.yndeanchem.com.
Yunnan Chengjiang Huaye Phosphorus has a capacity of 30,000 tonnes. It manufactures and
sells yellow phosphorus, technical and food grade phosphoric acid and STPP. The web site is
www.huayechem.com.
L-50
46 CRU Strategies
Wengfu Group is indirectly owned by the State and is fully integrated from phosphate rock to
downstream phosphate fertilizers and industrial products. The phosphorus plants are primarily
in Guizhou province and are under the Wengfu Phosphate Company and the downstream
phosphorus products are under the Wenfu J ianfeng Company. The Guizhou plant listed in
Table 4.2 has a P
4
capacity of 25,000 tonnes. Wengfu is also producing PPA under the Wengfu
Sazhou Company at Fuquan. The PPA plant was commissioned in Q2 2011 with a capacity of
150,000 tonnes PPA. The availability of low cost captive phosphate rock and a significant
presence in P
4
and downstream phosphorus products make Wengfu a low cost manufacturer.
They will continue to develop PPA technology as needed for future expansion.
Kaiyang Phosphorus Company (ANDA) operates 4 yellow phosphorus furnaces with a
capacity of 40,000 tonnes (Table 4.2 has 4 plants with a combined 53,000 tonnes capacity). The
plant is at Guiyang in Guizhou province. It used captive phosphate rock. ANDA converts P
4

into food grade phosphoric acid and STPP.
Jiangyin Chengxing Phosph-Chemical - Chengxing Group is a publicly traded company on
the Shanghai exchange (600078) located in J iangyin City in J iangsu province and is a subsidiary
of the Chengxing Group. The company focuses on phosphorus chemicals advertising on its web
site (www.phosphatechina.com), and has a phosphate capacity of over 1 million tonnes. It has a
150,000 tonnes yellow phosphorus plant and has more than 15 categories of
tech/food/toothpaste/electronic grades including yellow phosphorus.
Hubei Xingfa Chemicals Group has a reported 120,000 tonnes of yellow phosphorus capacity.
It manufactures technical and food grade phosphoric acid. The web site is
www.xingfagroup.com. The company also has phosphate rock and hydroelectric power plants.
Sichuan Leshan Jinguang Chemical Group has a reported 20,000 tonnes of yellow
phosphorus and sells yellow phosphorus and STPP and also produces its own power. The web
site is www.scjinguang.en.gongchang.com.

L-51
CRU Strategies 47
Tabl e 4.2: P4 Pr oduc er s i n Chi na

Company Capacity
(kg/a)
Output 2010
(tonnes)
Province
Guizhou Anda Phosphorus Company (ANDA) 25,000 15,929 Guizhou
Guizhou Fuguan Huaxin Chemical (J ianhong Yellow Phosphorus Plant) 5,000 4,400 Guizhou
Guizhou Kailin Group 20,000 6,220 Guizhou
Guizhou Kaiyang Guohua Tianxin Phosphate 14,000 10,140 Guizhou
Guizhou Kaiyang Lincheng Phosphorus 7,000 550 Guizhou
Guizhou Kaiyang Phosphorus 10,000 8,140 Guizhou
Guizhou Kaiyang Xinglang 22,000 11,450 Guizhou
Guizhou Nuclear Xinglang (Baima Phosphorus Plant) 20,000 1,930 Guizhou
Guizhou Qianneng Tianhe Phosphorus 50,000 13,600 Guizhou
Guizhou Qingli Tianmeng Chemical 15,000 10,800 Guizhou
Guizhou Shibing Success Phosphorus (Guizhou Shibin Yellow
Phosphorus)
24,000 10,350 Guizhou
Guizhou Sino-Phos Chemical 50,000 6,200 Guizhou
Guizhou Weng'an Longteng Phosphorus 13,000 9,190 Guizhou
Guizhou Wengfu Group 25,000 9,792 Guizhou
Guizhou Xifeng Phosphorite 20,000 10,290 Guizhou
Guizhou Zunyi Zhongii 14,000 1,430 Guizhou
Hubei Danjiangkou Shengyi Phosphorus 22,000 8,260 Hubei
Hubei Hefong Xuping Chemical 8,000 710 Hubei
Hubei Xiangfan Chemical 15,000 7,100 Hubei
Hubei Xinfa Chemicals 12,000 39,700 Hubei
Hubei Yaozhihe Chemical 10,000 7,860 Hubei
Hubei Yichang Chuyuan Chemical 30,000 7,350 Hubei
Hubei Yichang Yatal Chemical 25,000 16,900 Hubei
J iangsu J iangyin Chengxing Industrial Group 150,000 100,000 J iangsu
Leshan Kingssum Group 8,000 6,430 Sichuan
Lufeng Sanyuanling Chemical 10,000 3,330 Sichuan
Mingli (Group) Qiannan Phosphorus 10,000 4,800 Sichuan
Pan Country Hengda Phosphorus 10,000 1,560 Sichuan
Sheniongyuan Phosphorus 6,000 1,708 Sichuan
Shichuan Yibin J iuhe Chemical 10,000 3,300 Sichuan
Shifang Sundia Chemical 10,000 1,580 Sichuan
Sichuan Blue Sword Chemical 20,000 N/A Sichuan
Sichuan Deyang Maoyuan 25,000 3,680 Sichuan
Sichuan Leshan J inguang Chemical 20,000 28,110 Sichuan
Sichuan Linchem Enterprises 26,000 8,460 Sichuan
Sichuan Linhe Industrial Group 10,000 1,009 Sichuan
Sichuan Mabian J ianengjia Phosphorus 10,000 5,360 Sichuan
Sichuan Mabian Longtai Phosphorus 10,000 7,000 Sichuan
Sichuan Mabian Shunan Phosphorus 10,000 4,760 Sichuan
Sichuan Mianyang Aostar Phosphorus 30,000 17,910 Sichuan
Sichuan Mianyang Tianming Phosphate 10,000 3,900 Sichuan
Sichuan Nature Chemical 12,000 3,080 Sichuan
Sichuan New Sanin Chemical 20,000 N/A Sichuan
Sichuan Panzhihua Tianyi Chemical 15,000 16,265 Sichuan
Sichuan Province Chuantou Chemical 120,000 46,900 Sichuan
Sichuan Shimian Bluesky (Sichuan Simiankuang Yellow Phosphorus) 30,000 4,637 Sichuan
Continued
L-52
48 CRU Strategies
Tabl e 4.2: P4 Pr oduc er s i n Chi na (c ont i nued)

CRU believes small yellow phosphorus plants may also exist in Anhui, Beijing, Gansu,
Guangdong, Hunan, Inner Mongolia, J iangsu, Liaoning, Shaanxi, Shandong, Shanxi, Tianjin
Company Capacity
(kg/a)
Output 2010
(tonnes)
Province
Sichuan Shimian County Shulu Zinc Smelter 15,000 6,640 Sichuan
Weng'an Longma Phosphorus 50,000 6,750 Yunnan
Yunnan Changjiang Dean Phosphorus 38,000 22,050 Yunnan
Yunnan Chengjiang Huaye Phosphorus 30,000 13,550 Yunnan
Yunnan Chengjiang Iron Group Yellow Phosphorus 14,000 6,980 Yunnan
Yunnan Chengjiang Phosphorus Plant (Longlin Phosphate Plant 12,000 3,000 Yunnan
Yunnan Chengjiang Phosphoruc Chemical J inlong 22,000 10,880 Yunnan
Yunnan Chengjiang Zaifeng Hydroelectric 34,000 12,800 Yunnan
Yunnan Chengjiang Zhicheng Phosphorus 24,000 11,440 Yunnan
Yunnan Fuming Phosphate 5,500 2,200 Yunnan
Yunnan Gejiu Baoshuo Chemical 15,000 9,700 Yunnan
Yunnan Guangming Chemical 10,000 N/A Yunnan
Yunnan Guangnan Tengji Chemical 6,000 1,410 Yunnan
Yunnan Haokou Phosphate 6,000 4,630 Yunnan
Yunnan Hekou Phosphate 10,000 2,900 Yunnan
Yunnan Honghe Phosphor Power (Yannan Pingbian Welfare Yellow
Phosphate)
20,000 9,780 Yunnan
Yunnan Huaning Huadian Phosphorus 23,000 10,000 Yunnan
Yunnan J iangchuan Shilong Fine Phosphorus 12,000 3,640 Yunnan
Yunnan J ianglin Group 40,000 18,400 Yunnan
Yunnan J inning Yellow Phosphorus 10,000 4,400 Yunnan
Yunnan Kuming Grasun 10,000 0 Yunnan
Yunnan Linyuan Chemical (Yunan Huize Phosphate) 7,500 1,500 Yunnan
Yunnan Lufeng J iangda Phosphorus 13,000 1,300 Yunnan
Yunnan Luliang Hongying Phosphorus 20,000 7,960 Yunnan
Yunnan Luliang Wuxing Chemical 14,000 2,800 Yunnan
Yunnan Malong Industry Group 160,000 34,800 Yunnan
Yunnan Malong Yunhua Phosphorus 10,000 6,050 Yunnan
Yunnan Mile Phosphur Electric 40,000 39,300 Yunnan
Yunnan Phosphorus Group 80,000 66,600 Yunnan
Yunnan Shizhong J inlong Phosphate 12,000 0 Yunnan
Yunnan Xuanwei Tianlin Phosphorus 15,000 5,000 Yunnan
Yunnan Xuanwei Yangchang Coal & Electric 12,000 1,300 Yunnan
Yunnan Xudong Phosphor Chemical 20,000 7,550 Yunnan
Guizhou 334,000 130,411 Guizhou
Hubei 122,000 87,880 Hubei
Jiangsu 150,000 100,000 Jiangsu
Sichuan 447,000 180,419 Sichuan
Yunnan 795,000 328,670 Yunnan
Total 1,848,000 827,380
Note: CRU estimates for data that was not available are highlighted
Data: Ministry of Industry and Information Technology (MIIT)
L-53
CRU Strategies 49
and Zhejiang provinces with up to 50,000 additional capacity and up to 25,000 tonnes additional
production.
We tried an internet review of dozens of these P
4
manufacturers and realized that public
information is very limited. As a general rule, it appears that most are small P
4
plants with more
than 50 of the 79 identified at 20,000 tonnes or less capacity. Average production was about
10,000 tonnes for all Chinese plants. Most are integrated forward into phosphorus derivatives,
thermal phosphoric acid and downstream industrial or food grade products. It was difficult to
know how many were backward-integrated into phosphate rock but the largest producers
own rock mines. Some also manufactured their own power as P
4
manufacturing is power
intensive. Another interesting observation was that many of these companies are associated with
larger Groups. These Groups are associations or mergers generally within the province or
county and may be set up to consolidate as well as facilitate marketing. Because of these
Groups, it is difficult to know the size and the financial and marketing relationships of each
organisation.
4.4 Publ i c l i st ed phosphat e c ompani es i n Chi na
There are a number of publically traded fertilizer companies in the PRC listed on the Shenzhen
or the Shanghai stock exchange. Sinofert and China Blue and some others are listed on the
Hong Kong exchange while Migao and Hanfeng are on the Canadian exchange. The largest
publicly traded fertilizer companies are shown below.
L-54
50 CRU Strategies
Tabl e 4.3: Chi nese l i st ed (publ i c ) c ompani es

But, as Sichuan Mianzhu Norwest Phosphate Chemical Co. Ltd. primarily produces industrial
phosphates derived from yellow phosphorus, a comparison with the companies listed in the
table above is not reasonable. CRU has identified three Chinese companies that are publicly
traded, and which are involved in the production of phosphate rock, STPP and/or SHMP, in a
manner similar to Sichuan Mianzhu Norwest Phosphate Chemical Co. Ltd. But, even so, a
comparison with these is not strictly valid in view of their large-scale of production compared to
that of Sichuan Mianzhu Norwest Phosphate Chemical Co. Ltd. (also see Chapter 5).
Code Company List ed in Not e
Over seas list ed
297. HK Sinofert Hong Kong Potash, Phosphate, Urea
3983. HK China Blue Chemical Hong Kong Urea/methanol
01866 HK/ B9R.SI China XLX Fertilizer Hong Kong & Singapore Urea
827. HK Koyo Ecological Agrotech Hong Kong Urea/Bulk blend
TSX:MGO Migao Canada Potash
TSX: HF Hanfeng Evergreen Canada Slow release
Domestic listed
600230 Cangzhou Dahua Shanghai Urea/ammonia
953 Hechi Chemical Shenzhen Urea
600426 Hualu Hengsheng Shanghai Urea
950 J ianfeng Chemical Shenzhen Urea
731 Sichuan Meifeng Shenzhen Urea/NPK
422 Hubei Yihua Shenzhen DAP/MAP/urea
792 Salt Lake Potash Shenzhen MOP
600228 Changjiu Biochemical Shanghai Urea/Acrylamide
600470 Liuguo Chemical Shanghai DAP/NPK
600078 J ingsu Chengxing Phosph-Chem Shanghai Phosphorus
600096 Yuntianhua Shanghai Urea
600227 Chitianhua Shanghai Urea
155 Chuanhua Shenzhen Urea/ammonia
600423 Liuhua Shanghai Urea
912 Lutianhua Shenzhen Urea
2170 Batian Shenzhen NPK
2274 Huachang Chemical Shenzhen Urea/NPK
2217 United Chemical Shenzhen Urea
59 Liaotong Chemical Shenzhen Urea
830 Luxi Chemical Shenzhen Urea/NPK
2588 Shidanli Shenzhen NPK
707 Shuanghuan Sci & Tech Shenzhen Ammoniumchloride
2470 Kingenta Shenzhen NPK/slow release
2539 Xindu Chemical Shenzhen NPK /AN
2538 Sierte Shenzhen NPK/MAP
L-55
CRU Strategies 51
Tabl e 4.4: Chi nese I ndust r i al Phosphat e l i st ed (publ i c ) c ompani es

Company Stock Exchange
- Code
Phosphate
rock
Yellow
Phosphorus
Thermal
Acid
STPP SHMP
J iangyin Chengxing
Phosp-Chemicals
Shanghai 600078 Captive 150.0 450.0 150.0
Hubei Xingfa
Chemicals Group Co.
Shanghai 600141 Captive 120.0 200+ 250.0
Large
capacity
Yunnan Malong
Industry Group
Shanghai 600792 Merchant 60.0 X 140.0
Data: CRU estimates
Products manufactured/Capacity (000 tonnes)
L-56
52 CRU Strategies
Chapt er 5 Assessment of t he
Compet i t i ve Posi t i on of Si chuan
Mi anzhu Nor west Phosphat e Chemi c al
Co., Lt d.
5.1 Pl ant Fac i l i t i es
The following description has been provided to CRU by the client and the text is inserted here
in its entirety.
We are the first mineral resources company to be listed on the SGX-ST which is solely focused
on exploring and mining phosphate in the PRC with the ability to manufacture and produce
We are currently headquartered in Singapore, and possess the rights to explore and mine
phosphate in Sichuan Province, PRC. Prior to the Wenchuan Earthquake, we were engaged in a
vertically-integrated production process involving (i) Mining Operations; and (ii) Chemical
We currently own the mining and exploration rights to our Mines, which are located
approximately 40 km northwest of the New Gongxing Site. Currently, we have two (2) Mines
which are producing phosphate rocks. Between 2002 and the Wenchuan Earthquake, we
obtained approximately 379,000 tonnes of phosphate rock from Mine 1. For FY2005, FY2006
and FY2007, we obtained approximately 62,000, 71,000 and 89,000 tonnes of phosphate rocks
respectively from our Mines.
We have completed construction of the P
4
Plant at the New Gongxing site under Phase 1 of the
Rebuilding Programme in preparation for the resumption of our Chemical Production
Operations. We are currently in the preliminary stages of Phase 2 of the Rebuilding
Programme, which involves the construction of, inter alia, (i) a thermal phosphoric acid plant;
and (ii) a food-grade SHMP plant. We have also temporarily relocated our STPP equipment,
machinery and storage facilities from the Previous Hanwang Facilities to the New Gongxing
Site.
Our Group comprises our Company and our subsidiaries, Norwest Chemicals and Mianzhu
Norwest.
L-57
CRU Strategies 53
The construction of production facilities at Gongxing Industrial Zone is underway and the
complex will comprise the following:
x Yellow phosphorus (20,000 tonnes/a)
x Thermal phosphoric acid (30,000 tonnes/a as 85% acid)
x STPP (30,000 tonnes/a)
x SHMP (20,000 tonnes/a)
5.2 Compet i t or s
The Chinese thermal phosphoric acid industry is characterised by a very large number of small-
scale producers, and a small number of globally competitive plants. We believe there are around
20 large-scale producers (i.e. with an individual capacity in excess of 50,000 tonnes/a P
2
O
5
),
and taken together these account for over two-thirds of the total capacity. The largest producer
of thermal phosphoric acid is J iangsu Chengxing Phosphate Chemical plant with capacity in
excess of 450,000 tonnes/a P
2
O
5
; other major thermal acid producers are: Hubei Xinga
Chemicals Group, Guangxi Mingli Zhanli Chemicals, Yunnan Lancangjiang, and Yunphos
each of these producers has an individual capacity in excess of 150,000 tonnes P
2
O
5
.
The supply base for STPP and other phosphate salts is also highly fragmented, with a large
number of small-scale producers. We estimate that around 60% of Chinese plants (by number)
have a capacity of less than 20,000 tonnes/a product, accounting for less than 10% of total
capacity. The largest producer of STPP is Hubei Xinga Chemicals Group with capacity in
excess of 250,000 tonnes/a product; other major producers are: J iangsu Chengxing Phosphate
Chemicals, Chongqing Chuandong Chemical Industry Group, Yunphos, Yunnan Malong
Chemicals and Kaiyang Anda Phosphate - each of these producers has an individual capacity in
excess of 100,000 tonnes/a product.
The capacity for phosphates salts other than STPP in China is probably of the order of 0.5
million tonnes/a, of which a large proportion is represented by SHMP. The largest producer of
such phosphate salts is Hubei Xingfa Chemicals Group. Other major producers are: J iangsu
Chengxing Phosphate Chemicals and Yunphos.
In view of the foregoing remarks, Sichuan Mianzhu Norwest Phosphate Chemical Co. Ltd can
only be considered as a small-medium size producer of industrial phosphates, competing against
at least five major producer companies - J iangsu Chengxing Phosphate Chemicals, Hubei
Xingfa Chemicals Group, Yunnan Malong Chemicals, Chongqing Chuandong Chemical
Industry Group and Yunphos.
L-58
54 CRU Strategies
5.3 SWOT Anal ysi s
St r engt hs
x The Company has a captive position in the basic raw material phosphate rock.
The Company has already got approvals to increase mining depths for existing
mining areas as well as for new exploration areas.
x The Company has over 10 years experience of operations in phosphate rock
mining and some 16 years experience in downstream phosphate processing.
x Access to Monsanto process technology for granulated STPP yields a product with
superior physical characteristics, and enables the operation to be efficient.
x The Company has an extensive network of local and multi-national customers.
x Expected P
2
O
5
content of 29% of the Companys rock reserves compares favorably
with the estimated average of 20% P
2
O
5
for Chinas reserves overall.
Weak nesses
x The scale of operation is relatively small (particularly in relation to competitor
operations), and the Company has little control (or influence) over its selling prices
for its products, as these are largely influenced by supply and demand
considerations.
x The Chinese domestic market for STPP is fragmented, and trading conditions are
likely to remain tough during the outlook period.
x The Company is dependent on a merchant supply of alkali (caustic soda or soda
ash) for its production of STPP and other sodium phosphates products (SHMP etc.)
x The Company does not have the relevant licenses required by the PRC laws and
regulations
Oppor t uni t i es
x Although its opportunities for further product diversification are limited by the
nature of chemistry, some additional revenue and profits could be raised by
customizing its products (STPP, SHMP) for niche, higher-value, end-use
applications e.g. food-grade applications.
Thr eat s
x Any substantive increase in power tariffs is likely to have an adverse impact on the
cost-competitiveness of its operation.
L-59
CRU Strategies 55
x Market demand for STPP for detergents, both within China and elsewhere, is likely
to show little growth during the outlook period.
x A major market for SHMP (USA) has instituted anti-dumping investigations which
could restrict further market entry/penetration by Chinese producers.
5.4 Fut ur e Pr ospec t s
Given the nature of the markets for STPP and for other sodium phosphate products (SHMP etc.)
and the physical facilities of the company, it seems there is no conventional way of substantially
changing the outlook picture. CRU takes the view that the Company should build on what has
shown to be effective the elements of this strategy are:
x Maintain particular emphasis on meeting demand growth in its domestic market.
x Exploit any project for incremental capacity expansion at low cost
x Continue to switch sales (of STPP, SHMP etc.) into higher netback end-uses and
customers away from low netback end-uses and customers, whilst controlling sales
costs at present levels.
x Actively pursue export sales of SHMP and other phosphate salts.
x Exploit the potential to increase merchant sales of phosphate rock and thermal
phosphoric acid.
These actions, taken together, should produce positive results throughout the forecast period.
However, CRU would not expect any large step increase in the performance of the Company.

L-60
56 CRU Strategies
Appendi x A

Tabl e A.1: Phosphat e r oc k pr i c e f or ec ast , 1995-2017 (US$/t onne)

India
65-75 BPL 80 BPL 68/72 BPL 73/75 BPL 73/75 BPL
fob Casablanca fob Bou-craa cfr India
1995 27 29 32 37
1996 30 32 32 38
1997 32 34 34 42 61
1998 34 36 39 46 63
1999 35 36 35 42 63
2000 35 40 28 40 55
2001 34 38 28 40 51
2002 34 36 28 37 50
2003 32 36 31 36 50
2004 34 38 30 41 52
2005 38 40 34 47 63
2006 40 50 40 50 73
2007 50 55 65 70 93
2008 170 190 170 190 185
2009 105 110 106 110 131
2010 103 115 104 114 139
2011 185 199 182 192 199
2012 186 200 186 195 201
2013 163 174 160 167 176
2014 172 186 176 184 195
2015 180 193 184 191 202
2016 159 171 163 169 182
2017 157 169 161 168 183
fob Aqaba
MOROCCO JORDAN
L-61
AsiaPhos Limited Company Registration No. 201200335G

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