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Note 1

(in millions of US dollars except share and per-share amounts)

1. Description of Business

With its subsidiaries, Potash Corporation of Saskatchewan Inc. ("PCS") – together known as "PotashCorp" or "the company" except to the extent the context otherwise requires – forms an integrated fertilizer and related industrial and feed products company. The company has producing assets in the following locations:

Potash

  • five mines and mills and mining rights to potash reserves at a sixth location, all in the province of Saskatchewan
  • one mine and mill in the province of New Brunswick

Phosphate

  • a mine and processing plants in the state of North Carolina
  • a mine and two processing plants in the state of Florida
  • a processing plant in the state of Louisiana
  • phosphate feed plants in five states and one in Brazil
  • an industrial phosphoric acid plant in the state of Ohio

Nitrogen

  • three plants in the states of Georgia, Louisiana and Ohio
  • large-scale operations in Trinidad

In Canada and the United States, the company owns or leases 168 terminal and warehouse facilities, some of which have multi-product capability, for a total of 206 strategically located distribution points, and services customers with a fleet of approximately 8,570 railcars. In the offshore market, the company owns or leases two warehouses in Brazil and one in China.

PotashCorp sells potash from its Saskatchewan mines for use outside North America exclusively to Canpotex Limited ("Canpotex"). Canpotex, a potash export, sales and marketing company owned in equal shares by the three potash producers in the province of Saskatchewan (including the company), resells potash to offshore customers. PCS Sales (Canada) Inc. and PCS Sales (USA), Inc., wholly owned subsidiaries of PCS, execute marketing and sales for the company's potash, nitrogen and phosphate products in North America, and execute offshore marketing and sales for the company's New Brunswick potash. PCS Sales (USA), Inc. generally executes offshore marketing and sales for the company's nitrogen products. Phosphate Chemicals Export Association, Inc. ("PhosChem"), an unrelated phosphate export association established under United States law, is the principal vehicle through which the company executes offshore marketing and sales for its phosphate fertilizers.