PotashCorp Announces Major Projects at Lanigan and Allan Potash Facilities Listed: TSX, NYSE Symbol: POT SASKATOON, SK, April 11 /PRNewswire-FirstCall/ -- Potash Corporation of Saskatchewan Inc. (PotashCorp) today announced that it will bring back 1.9 million tonnes of its idle production capacity in Saskatchewan, following a Government of Saskatchewan announcement of new provincial mining tax incentives for potash capital projects. The Lanigan phase I mill restoration will contribute an additional 1.5 million tonnes of annual production capability, while Allan will contribute 400,000 tonnes per year. In total, the two projects will cost US $275 million. To reach its full capacity of 12.5 million tonnes, PotashCorp is also evaluating two smaller projects at its Cory and Patience Lake mines to more fully utilize their production capability. While engineering studies are not yet complete, current cost estimates of these projects are in the range of US $120 million to $140 million. "Potash is the cornerstone of our success and as the preeminent global supplier, the world is turning to us to seamlessly meet its growing need for potash products. The Lanigan and Allan projects, which can be brought on stream quickly at only one-quarter the cost of new greenfield capacity, will help ensure the success of our potash-first strategy as we move forward," said Bill Doyle, PotashCorp President and CEO. In addition, the company will be adding compaction equipment to meet the rising demand for granular products from key customers in Latin America and Asia who are experiencing accelerating economic growth. Granular potash currently enjoys a premium of approximately 20 percent over the price of standard grade product in the market place. At Lanigan, US $41 million will be spent on compaction equipment that will add 750,000 tonnes per year of granular capacity, while at Allan an additional US $64 million will be spent on a compaction facility and related equipment, which will increase granular capacity by 500,000 tonnes per year. In total, 1.25 million tonnes of annual compaction capacity will be added. The company's total investment in Lanigan and Allan, including compaction capacity, will be approximately US $380 million (CDN $456 million). Allan's capacity is expected to come on stream in April 2006, with Lanigan's new production coming on in the fourth quarter of 2007. The Government of Saskatchewan modified the provincial mining taxes applicable to potash projects, allowing for a 10-year base payment holiday on expansions of 200,000 tonnes or larger, resulting in pre-tax savings of approximately US $6.25 per tonne at today's Canada/US exchange rate. The time clock on the base payment holiday for production tonnes associated with expansions starts with Government approval of the project, and includes the construction period. In addition, the Government is allowing additional capital investment writedowns. "These tax changes allow PotashCorp to continue investing in Saskatchewan," said Doyle. "We operate in a number of countries and always weigh capital expansion opportunities with shareholder value in mind. We look forward to continuing our work with the provincial government to ensure Saskatchewan maintains a competitive business environment to justify ongoing capital investment in the potash industry." Potash Corporation of Saskatchewan Inc. is the world's largest fertilizer enterprise producing the three primary plant nutrients and a leading supplier to three distinct market categories: agriculture, with the largest capacity in the world in potash, third largest in phosphate and fourth largest in nitrogen; animal nutrition, with the world's largest capacity in phosphate feed ingredients; and industrial chemicals, as the largest global producer of industrial nitrogen products and one of only three North American suppliers of industrial phosphates. This release contains forward-looking statements, which involve risks and uncertainties, including those referred to in the company's annual report to shareholders for 2004 and in filings with the U.S. Securities and Exchange Commission and Canadian provincial securities commissions. A number of factors could cause actual results to differ materially from those in the forward-looking statements, including, but not limited to: fluctuation in supply and demand in fertilizer, sulfur, transportation and petrochemical markets; changes in competitive pressures, including pricing pressures; risks associated with natural gas and other hedging activities; changes in capital markets; changes in currency and exchange rates; unexpected geological or environmental conditions; and government policy changes. DATASOURCE: Potash Corporation of Saskatchewan Inc. CONTACT: Betty-Ann Heggie, Senior Vice President, Corporate Relations, Phone: (306) 933-8521, Fax: (306) 933-8844, E-mail: , Web Site: http://www.potashcorp.com/

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