Phosphate: Morocco's White Gold

Phosphate is used in everything from fertilizer to rechargeable batteries. And Morocco's King Mohammed VI has cornered the market

In UN-patrolled Western Sahara, phosphate goes to port via a 62-mile-long conveyor belt Michael Fay/National Geographic/Getty Images
By Brendan Borrell and Daniel Grushkin
In May 2009 a petite brunette from Paris wearing black heels scrambled up a pile of mine tailings on the outskirts of the Moroccan town of Khouribga. From up there, Béatrice Montagnier, a hotel specialist with the hospitality consulting firm Horwath, took in the view: parched plains scoured by bulldozers; an old warehouse baking in the sun; a jumble of two-story concrete block homes with a rectangular minaret beyond them. She spun around 360 degrees snapping photos with her pink cell phone and imagining the future: a planned 800-acre resort project that would attract visitors from around the world. How many hotel rooms would they need? she wondered. Should it be three stars or four? And where would the museum be going? There was one issue—project funding—about which Montagnier had no questions. The estimated $1 billion needed to build the resort would come from the ground beneath her feet.
Miners have been working in Khouribga for almost a century, but only now is the area poised to become central to the global economy. Back in the 1920s pioneers started tunneling through the earth here, digging through layers of sediment formed under an ancient sea, looking for phosphate-rich rock and occasionally plucking out the tooth of a 30-million-year-old shark. The phosphate extracted from the rock, used in fertilizer, detergent, food additives, and more recently lithium-ion batteries, sold for decades in its raw state for less than $40 per metric ton. Those days are gone. It's currently trading at about $130.
This is good news for King Mohammed VI, 47, who owns more than half the world's phosphate reserves. James Prokopanko, chief executive officer of Plymouth (Minn.)-based fertilizer giant Mosaic (MOS), has called Morocco the Saudi Arabia of phosphate, with all that implies about the King's power to influence prices and economies. Mohammed's strategy, by most accounts, is to drive the commodity's price higher yet—which means the cost of making everything from corn syrup to iPads will be going up as well.
Mohammed VI is the unofficial overseer of the state-owned phosphate monopoly, Office Chérifien des Phosphates (OCP), Morocco's largest industrial company. He is also the power behind Montagnier's visit to Khouribga, which lies on the Plateau des Phosphates, halfway between the modern city of Casablanca and the salmon-colored souks of Marrakech. Today it is a scrappy mining town of 160,000 that doesn't even merit a mention in Fodor's. That's about to change, says Montagnier, repeating the words of her client: "It's time to give back to Khouribga what the earth gave to us."
The project will be called the Mine Verte, or "green mine," and it will be a fantasyland glorifying the country's mineral inheritance. The plans are grand, in the Dubai style. As is the fashion these days in Arab monarchies, the Mine Verte will be environmentally sustainable, thus the "green." Fossils hidden in OCP warehouses will be displayed in a sparkling museum powered by wind and sun. A depleted mine will be transformed into gardens, performance spaces, and housing for OCP employees and other visitors, all designed by top French and Moroccan architects working with London-based environmental consultants BDSP. Plans for a "mega-amusement park" on the premises include an equestrian center, a cable car, and an indoor ski slope on a pile of mine waste. Even bungee jumping made the list; the King is a thrill-seeker, fond of jet-skis and sports cars, who once flew his Aston Martin DB7 to London for repair. In all, the Mine Verte will be a glittering monument to geologic good fortune.

http://www.businessweek.com/magazine/content/10_46/b4203080895976.htm