Phosagro S Regulatory News (PHOR)

For Immediate Release 08 December 2014 PhosAgro Signs Contract for Ammonium Sulphate Production Line with GEA Messo Moscow - PhosAgro ("PhosAgro" or "the Company") (Moscow Exchange, LSE: PHOR),one of the world's leading vertically integrated phosphate-based fertilizerproducers, has signed a contract for the design, delivery and assembly ofequipment for a new ammonium sulphate production line with a capacity of 300ths tonnes per year at PhosAgro-Cherepovets with the German company GEA MessoP.T.* PhosAgro subsidiary Mining and Chemical Engineering will do initialengineering and design work for the new production capacity. This project will use the best available technologies and modern equipment,helping it to achieve high levels of energy, resource and labour efficiency, aswell as environmental and industrial safety. GEA Messo P.T. Managing Director Reinhard Scholz said: "The ammonium sulphateproduction line that will be built in Cherepovets uses a crystallisationprocess and will be the largest individual capacity in the world. This uniqueproduction facility will be designed with careful consideration for allenvironmental requirements. It is a completely closed-cycled productionprocess, meaning it will not produce any wastewater." Ammonium sulphate is an important component of NPK and NPKS fertilizers,including for niche products sold to premium markets. PhosAgro is currently thelargest consumer of ammonium sulphate in Russia. The Company currentlypurchases the product from various chemical and metallurgical plants. The newammonium sulphate production line will utilise sulphuric acid and ammoniaproduced at PhosAgro-Cherepovets. PhosAgro CEO Andrey Guryev said: "The new ammonium sulphate production linewill improve our resource security by removing risks related to the supply ofthe chemical components that our production facilities require formanufacturing complex fertilizers, especially given our growth plans. Our ownsupply of high-quality ammonium sulphate will be sufficient to cover all of ourinternal requirements." The new production facility is due to be commissioned in 2017. Totalinvestments, including project engineering work, delivery and assembly, areexpected to amount to over RUB 2.7 billion. PhosAgro plans to finance theproject with its own funds and through borrowings. In parallel to theconstruction, staff training and education courses will start. The new facilitywill create 30 new jobs. Construction of the new ammonium sulphate line is part of PhosAgro's strategyto 2020, which includes development of the Company's resource base andprocessing facilities. Under PhosAgro's strategy to 2020, PhosAgro-Cherepovetswill gain a new 760 ths tonne per year ammonia production facility, a new 500ths tonne per year granulated urea line and the new 300 ths tonne per yearammonium sulphate production, as well as expanded complex fertilizercapacities. The Company plans investments of over USD 1,072 million intodeveloping its chemical production capacities. *GEA Messo P.T. is one of the world's leading producers of crystallisationequipment for the chemicals sector, including the fertilizer industry, and is adeveloper and manufacturer of chemical equipment. For further information please contact: OJSC PhosAgro Irina Evstigneeva, Head of Corporate Finance and Investor Relationsir@phosagro.ru+7 495 231 3115 Timur Belov, Press Officer+7 495 232 9689 EM Sam VanDerlipvanderlip@em-comms.com+44 7554 993 032+7 916 306 6112 Notes to Editors PhosAgro is one of the leading global vertically integrated phosphate-basedfertilizer producers. The Company focuses on the production of phosphate-basedfertilizers, feed phosphate and high-grade phosphate rock (P2O5 content of notless than 39%), as well as ammonia and nitrogen-based fertilizers. The Company is the largest phosphate-based fertilizer producer in Europe, thelargest producer of high-grade phosphate rock worldwide and the second largestMAP/DAP producer in the world (excluding China), according to Fertecon.PhosAgro is also one of the leading producers of feed phosphates (MCP) inEurope, and the only producer in Russia. PhosAgro has 2.1 billion tonnes of resources (according to JORC) of highquality apatite-nepheline ore. The Company's mines and phosphate rockproduction facilities are located in the mountainous areas of the KolaPeninsula in the Murmansk region of northwest Russia, whereas its fertilizerand feed phosphate production assets are located near the city of Cherepovetsin the Vologda region and near the city of Balakovo in the Saratov region ofsouthwest part of European Russia. PhosAgro's 2013 IFRS revenue was over USD 3.3 bln and EBITDA was USD 752 mln.The Сompany's net debt/EBITDA ratio was 1.8 at 31 December 2013.

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