Gensource Potash Applauds Federal Productivity Mega Deduction Announced in Toronto, Highlights Transformative Impact for Tugaske Project
New Canadian tax rules enabling 100% expensing of mining capital are expected to enhance Tugaske’s after-tax returns and support project financing.
Rhea-AI Summary
Gensource Potash (AGCCF) highlights the Canadian federal Productivity Mega Deduction/b) as materially improving the economics of its Tugaske Potash Project. Announced on September 15, 2026, the measure allows 100% immediate expensing of eligible capital investments when assets become available for use, expanding eligible assets from about 15% to more than 65% of capital and explicitly including mining property. The government projects this will cut Canada’s marginal effective tax rate on new business investment from roughly 13% to 6.4%, the lowest in the G7.The Tugaske Project is being re‑engineered for 500,000 tonnes per year of MOP, up from the original 250,000‑tonne design, which had an estimated capital cost of approximately C$352 million. Under the new regime, Gensource expects the Tugaske SPV to immediately expense mining property, process plant equipment and site infrastructure acquired on or after September 15, 2026, accelerating capital cost recovery and early‑year cash flows. The project has a 360‑million‑tonne MOP resource, full offtake coverage, bottom‑decile cash costs, and a Technical Refresh that is almost 90% complete.
Positive
- Tax incentive expands: eligible capital rises from ~15% to >65%, including mining property
- Lower tax burden: marginal effective rate on new investment projected to fall from ~13% to 6.4%
- Tugaske scale-up: planned capacity increased from 250,000 to 500,000 tonnes MOP per year
- Capital benchmark: original 250,000‑tonne design estimated at approximately C$352 million
- Resource base: 360 million tonnes of finished MOP in measured and indicated categories
- Engineering progress: Technical Refresh for Tugaske is almost 90% complete
Negative
- None.
AI-generated analysis. How Rhea-AI works. Not financial advice.
Saskatoon, Saskatchewan--(Newsfile Corp. - September 23, 2026) - Gensource Potash Corporation (TSXV: GSP) (FSE: UGN) (OTC Pink: AGCCF) ("Gensource" or the "Company") today welcomes the Canadian Federal Government's announcement of the Productivity Mega Deduction, a landmark tax measure that will fundamentally improve the economics of major capital projects in Canada, including the Company's flagship Tugaske Potash Project.
Productivity Mega Deduction: A Game-Changer for Canadian Mining
On September 15, 2026, at the first Canada Investment Summit in Toronto, Prime Minister Mark Carney announced the Productivity Mega Deduction, expanding and making permanent the previous Productivity Super-Deduction originally introduced in the Canadian Budget in early 2025. The new measure allows businesses to immediately deduct
Critically for Gensource, the Productivity Mega Deduction expands eligible assets from approximately
"The Productivity Mega Deduction announced by Prime Minister Carney in Toronto is precisely the kind of bold, forward-looking policy that Canadian resource developers have needed," said Mike Ferguson, President & CEO of Gensource. "By including mining property and making immediate expensing permanent, the federal government has sent an unmistakable signal that Canada is open for major project investment. For Gensource, this directly enhances the after-tax economics of the Tugaske Project at the very moment we are finalizing our Technical Refresh and advancing project financing with our ASEAN partner."
Direct Impact on the Tugaske Project
The Tugaske Potash Project is currently undergoing a comprehensive Technical Refresh targeting a capacity of 500,000 tonnes per year of premium Muriate of Potash (MOP), double the original 250,000 tonne-per-year design. The project's capital cost estimate at the original scale was (see NI 43-101 dated November 2021) approximately C
Under the Productivity Mega Deduction, Gensource would be able to immediately expense eligible capital expenditures for mining property, process plant equipment, site infrastructure, and related assets acquired on or after September 15, 2026. This treatment would significantly accelerate the planned SPV's (Special Purpose Vehicle) ability to recover capital costs, improving project cash flows to senior lenders and shareholders during the critical early years of operation and enhancing overall project returns.
The Mining Association of Canada (MAC) welcomed the announcement, with President and CEO Pierre Gratton stating: "Today's announcement by Prime Minister Carney is transformative. With these announced new measures, Canada will become one of, if not the most, competitive mining tax jurisdictions in the world".
Tugaske Project Highlights
The Tugaske Project is distinguished by:
- A measured and indicated resource base of 360 million tonnes of finished MOP product, with the Tugaske Project footprint representing only
10% of Gensource's total mining lease area. - Offtake agreements in place for the full planned production, with product destined for U.S. and Southeast Asian markets.
- A proprietary solution mining process that eliminates surface tailings and avoids the need for traditional brine or cooling ponds.
- Strong project economics, even at the original smaller scale, and cash operating costs per tonne in the bottom decile of the global cost curve.
The Technical Refresh is almost
About Gensource:
Gensource is a fertilizer development company based in Saskatoon, Saskatchewan and is on track to become the next fertilizer production company in that province. With a modular and environmentally leading approach to potash production, Gensource believes its technical and business model will be the future of the industry. Gensource operates under a business plan that has two key components: (1) vertical integration with the market to ensure that all production capacity built is directed, and pre-sold, to a specific market, eliminating market-side risk; and (2) technical innovation which will allow for a modular and economic potash production facility, that demonstrates environmental leadership within the industry, producing no salt tailings, therefore eliminating decommissioning.
For further information on Gensource Potash, please contact:
Mike Ferguson - President & CEO
+1-306-974-6414
Further information on Gensource Potash Corporation can be found at www.gensourcepotash.ca
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Caution Regarding Forward-Looking Statements
This news release may contain forward looking information and Gensource cautions readers that forward-looking information is based on certain assumptions and risk factors that could cause actual results to differ materially from the expectations of Gensource included in this news release. This news release includes certain "forward-looking statements", which often, but not always, can be identified by the use of words such as "believes", "anticipates", "expects", "estimates", "may", "could", "would", "will", or "plan". These statements are based on information currently available to Gensource and Gensource provides no assurance that the actual results will meet management's expectations.
Forward-looking statements include estimates and statements with respect to Gensource's future plans, objectives or goals, to the effect that Gensource or management expects a stated condition or result to occur, including any offering of securities by Gensource. Since forward-looking statements are based on assumptions and address future events and conditions, by their very nature they involve inherent risks and uncertainties. Actual results could differ materially from those currently anticipated in such statements for many reasons such as: failure to finance the Tugaske Project or other projects on terms which are economic or at all; failure to settle a definitive agreement with a party and advance and finance the Tugaske Project; changes in general economic conditions and conditions in the financial markets; the ability to find and source off-take agreements; changes in demand and prices for potash; litigation, legislative, environmental and other judicial, regulatory, political and competitive developments; technological and operational difficulties encountered in connection with Gensource's activities; and other matters discussed in this news release and in filings made with securities regulators. This list is not exhaustive of the factors that may affect any of Gensource's forward-looking statements. These and other factors should be considered carefully, and readers should not place undue reliance on Gensource's forward-looking statements. Gensource does not undertake to update any forward-looking statement that may be made from time to time by Gensource or on its behalf, except in accordance with applicable securities laws.
To view the source version of this press release, please visit https://www.newsfilecorp.com/release/315595
FAQ
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What is the Canadian Productivity Mega Deduction and how does it differ from the prior regime?
The Productivity Mega Deduction makes permanent and expands the earlier Productivity Super‑Deduction. It allows businesses to immediately deduct 100% of the cost of eligible capital investments in the year the asset becomes available for use, instead of depreciating those costs over time under the traditional capital cost allowance system. It also expands eligibility so that more than 65% of capital investments qualify, compared with roughly 15% previously.
How is the Productivity Mega Deduction expected to impact Gensource’s Tugaske Project specifically?
For Tugaske, Gensource expects to immediately expense eligible capital expenditures for mining property, process plant equipment, site infrastructure and related assets acquired on or after September 15, 2026. This is expected to accelerate the project SPV’s recovery of capital costs, improving projected cash flows to senior lenders and shareholders in the early years of operation and enhancing overall project returns.
What are the main Tugaske Project highlights mentioned in the announcement?
The Tugaske Project has a measured and indicated resource base of 360 million tonnes of finished MOP, with the current footprint representing about 10% of Gensource’s mining lease area. Offtake agreements cover the full planned production for U.S. and Southeast Asian markets. The project uses a proprietary solution mining process that eliminates surface tailings and does not require traditional brine or cooling ponds, and its cash operating costs per tonne are described as being in the bottom decile of the global cost curve.
What is the status and role of the Technical Refresh for the Tugaske Project?
The Technical Refresh for Tugaske is almost 90% complete, with finalization expected in the fall. The updated study targets a 500,000‑tonne‑per‑year MOP capacity and will provide revised capital figures for the expanded case. This report is intended to form part of the definitive basis for project financing and the anticipated Final Investment Decision.