Brazil Potash project in the Amazon faces headwinds

The Brazilian unit of Canadian miner Brazil Potash, Potássio do Brasil, may not be able to continue conducting exploration in the Mura Indigenous territory of the Amazon following a court challenge. 

A lower court ruled on Aug. 25 that if the land is demarcated as Indigenous in the future, then only Brazil’s Congress and not the court could authorize mining in the area.

Judge Jaiza’s decision responded to a request from the federal prosecutors office (Ministério Público Federal – MPF), alleging that various procedures related to the granting of the permit were not properly followed.

The MPF, which is a body independent of Brazil’s government, alleged in its civil action that the Institute for Environmental Protection of Amazonas (Ipaam), which initially granted the permit, didn’t have the right to do so.

It also claimed that Potássio do Brasil violated the local Indigenous populations’ constitutional rights of land usage, failed to conduct sufficient consultation with affected communities and threatened local leaders.

Brazil Potash’s CEO, Matt Simpson, said that the resolution doesn’t affect the company’s preliminary permit for the $2.5 billion Autazes potash project.

He noted that the land where the project is located is not Indigenous.

“We cut our permit between Indigenous and non-Indigenous lands and the only lands included in our Nov 2022 Pre-Feasibility Study and being permitted are non-Indigenous,” Simpson said.  

The executive pointed out that it’s difficult to hold the MPF accountable for actions they undertake.

“At times [their actions] are based on personal biases as opposed to enforcement of the laws as they should solely be doing. Brazil Potash’s situation is unfortunately an example of MPF’s abuse of power,” he said.

Simpson noted the MPF’s leader is trying to stop the Mura Indigenous consultations from proceeding because of his “personal bias against mines being developed in the Amazon”, regardless of what the Mura group believes is in their best interest.

In April, Brazil’s Superior Court reinstated Brazil Potash’s preliminary licence for the $2.5 billion Autazes potash as granted by the State Environmental Protection Agency, acknowledging the company met the terms of its agreement with the Mura, the MPF and the lower court.

The top court’s judge also criticized the lower court judge for interfering in the consultation process between Brazil Potash and the Mura people.  

A fifth of Brazil’s potash needs

The proposed mine and processing facilities in Autazes, 120 km southeast of the Amazonas state capital Manaus, would require about three years to build.

The project will be built on low density cattle farm land, deforested several decades ago by prior owners, Brazil Potash says. The ore body is not located under Indigenous land, but is within 10 km of two reserves resulting in the need for consultation with locals.  

Production is expected to start in 2026 with an initial output sufficient to cover about 20% of Brazil’s potash needs. Project capacity is pegged at 2.2 million tonnes of potassium chloride per year, according to the company.

Potash is a vital commodity in Brazil, and there are several potential projects in a 400-km belt south of the Amazon which the government hopes will end its almost complete reliance on imports of the material.

The majority of potash used in Brazil comes from mines in Canada, the world’s number one producer, and Russia. Russia and Belarus jointly account for about 41% of global potash exports – but disruptions spurred importer countries to find other suppliers.

** The original article mistakenly said that the local court had suspended the company’s preliminary permit. We regret the error **