##### Table of Contents



UNITED
    STATES SECURITIES AND EXCHANGE COMMISSIONWashington, D.C.
    20549
      FORM
    10-Q
  þ

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934For the Quarterly Period Ended September 30, 2007ORo

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934   Commission File Number 1-10351
   POTASH CORPORATION OF
    SASKATCHEWAN INC.
 (Exact name of registrant as specified in its charter)
   Canada

N/A(State or other jurisdiction of
    incorporation or organization)

(I.R.S. Employer
    Identification No.)122  1st Avenue South

S7K 7G3Saskatoon, Saskatchewan, Canada

(Zip Code)(Address of principal executive offices)    306-933-8500
 (Registrants telephone number, including area code)
     þ o
  Rule 12b-2
  þ o o
  Rule 12b-2).
  o þ




---



TABLE OF CONTENTS  PART I. FINANCIAL INFORMATIONITEM 1. FINANCIAL STATEMENTSITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISKITEM 4. CONTROLS AND PROCEDURESPART II. OTHER INFORMATIONITEM 6. EXHIBITSSIGNATURESExhibit 11Exhibit 31(a)Exhibit 31(b)Exhibit 32    Table of Contents  
  PART I.  FINANCIAL
    INFORMATION
 
  ITEM
    1.FINANCIAL STATEMENTS
  Potash
    Corporation of Saskatchewan Inc.
    Condensed Consolidated Statements of Financial Position
    (in millions of US dollars except share amounts)
    (unaudited)
  September 30,


December 31,2007


2006AssetsCurrent assetsCash and cash equivalents

$
442.5


$
325.7Other short-term investments (Note 2)


112.5



-Accounts receivable


581.3



442.3Inventories (Note 3)


433.3



501.3Prepaid expenses and other current assets


39.9



40.9Current portion of derivative instrument assets


41.4



-1,650.9



1,310.2Derivative instrument assets


73.5



-Property, plant and equipment


3,722.9



3,525.8Investments (Note 4)


2,926.1



1,148.9Other assets


128.1



105.8Intangible assets


25.8



29.3Goodwill


97.0



97.0$
8,624.3


$
6,217.0LiabilitiesCurrent liabilitiesShort-term debt

$
92.1


$
157.9Accounts payable and accrued charges


681.1



545.2Current portion of long-term debt


0.2



400.4773.4



1,103.5Long-term debt (Note 6)


1,337.9



1,357.1Future income tax liability


1,019.4



632.1Accrued pension and other post-retirement benefits


237.4



219.6Accrued environmental costs and asset retirement obligations


122.2



110.3Other non-current liabilities and deferred credits


3.5



14.13,493.8



3,436.7Contingencies and Guarantees (Notes 17 and 18,
    respectively)Shareholders EquityShare capital (Note 7)


1,456.2



1,431.6Unlimited authorization of common shares without par value;
    issued and outstanding 316,114,911 and 314,403,147 at
    September 30, 2007 and December 31, 2006, respectivelyUnlimited authorization of first preferred shares; none
    outstandingContributed surplus


95.1



62.3Accumulated other comprehensive income (Note 8)


1,644.8



-Retained earnings


1,934.4



1,286.45,130.5



2,780.3$
8,624.3


$
6,217.0     2




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##### Table of Contents



Potash
    Corporation of Saskatchewan Inc.
  Condensed Consolidated Statements of Operations and Retained
    Earnings
    (in millions of US dollars except per-share amounts)
    (unaudited)
  Three Months Ended


Nine Months EndedSeptember 30


September 302007


2006


2007


2006Sales (Note 11)

$
1,295.0


$
953.5


$
3,802.8


$
2,743.8Less: Freight


80.6



65.6



254.8



182.8Transportation and distribution


31.0



37.6



94.6



104.6Cost of goods sold


708.3



604.5



2,107.2



1,753.7Gross Margin


475.1



245.8



1,346.2



702.7Selling and administrative


43.9



35.9



158.0



114.6Provincial mining and other taxes


28.2



12.5



95.3



41.2Foreign exchange loss (gain)


25.9



(4.7
)


67.4



9.2Other income (Note 14)


(29.1
)


(21.1
)


(111.3
)


(72.3
)68.9



22.6



209.4



92.7Operating Income


406.2



223.2



1,136.8



610.0Interest Expense (Note 15)


12.7



25.2



59.0



69.1Income Before Income Taxes


393.5



198.0



1,077.8



540.9Income Taxes (Note 9)


150.4



52.8



351.0



95.1Net Income

$
243.1


$
145.2



726.8



445.8Retained Earnings, Beginning of Period










1,286.4



716.9Change in Accounting Policy (Note 1)










0.2



-Dividends










(79.0
)


(46.5
)Retained Earnings, End of Period









$
1,934.4


$
1,116.2Net Income Per Share (Note 10)Basic

$
0.77


$
0.47


$
2.30


$
1.43Diluted

$
0.75


$
0.46


$
2.25


$
1.40Dividends Per Share

$
0.10


$
0.05


$
0.25


$
0.15     3




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##### Table of Contents



Potash
    Corporation of Saskatchewan Inc.
  Condensed
    Consolidated Statements of Cash Flow
 (in millions of US dollars)
 (unaudited)
  Three Months Ended


Nine Months EndedSeptember 30


September 302007


2006


2007


2006Operating ActivitiesNet income

$
243.1


$
145.2


$
726.8


$
445.8Adjustments to reconcile net income to cash provided by
    operating activitiesDepreciation and amortization


69.5



62.2



216.3



181.4Stock-based compensation


4.2



2.8



34.7



26.8Loss (gain) on disposal of property, plant and equipment and
    long-term investments


0.2



(4.2
)


5.6



(3.9
)Provision for plant shutdowns - phosphate segment


-



6.3



-



6.3Foreign exchange on future income tax


21.4



-



47.5



12.1Provision for future income tax


52.6



17.8



119.8



3.9Undistributed earnings of equity investees


(15.7
)


(10.6
)


(17.6
)


(9.1
)Unrealized gain on derivative instruments


(13.0
)


-



(18.4
)


-Other long-term liabilities


(25.6
)


9.3



(21.3
)


11.9Subtotal of adjustments


93.6



83.6



366.6



229.4Changes in non-cash operating working capitalAccounts receivable


(100.2
)


(52.6
)


(139.9
)


(1.1
)Inventories


35.5



23.3



51.6



21.8Prepaid expenses and other current assets


0.8



10.4



1.3



(23.3
)Accounts payable and accrued charges


38.8



15.0



150.9



(319.0
)Subtotal of changes in non-cash operating working capital


(25.1
)


(3.9
)


63.9



(321.6
)Cash provided by operating activities


311.6



224.9



1,157.3



353.6Investing ActivitiesAdditions to property, plant and equipment


(145.1
)


(133.8
)


(381.6
)


(384.9
)Purchase of long-term investments


(21.0
)


-



(30.7
)


(130.0
)Purchase of other short-term investments


(132.5
)


-



(132.5
)


-Proceeds from disposal of property, plant and equipment and
    long-term investments


2.9



7.8



4.2



10.0Other assets and intangible assets


(0.9
)


(0.7
)


9.8



2.3Cash used in investing activities


(296.6
)


(126.7
)


(530.8
)


(502.6
)Cash before financing activities


15.0



98.2



626.5



(149.0
)Financing ActivitiesRepayment and issue costs of long-term debt obligations


-



(0.3
)


(403.6
)


(1.0
)Proceeds from (repayment of) short-term debt obligations


5.5



(26.5
)


(65.8
)


277.8Dividends


(31.3
)


(15.2
)


(62.6
)


(45.7
)Issuance of common shares


3.6



5.5



22.3



15.4Cash (used in) provided by financing activities


(22.2
)


(36.5
)


(509.7
)


246.5(Decrease) Increase in Cash and Cash Equivalents


(7.2
)


61.7



116.8



97.5Cash and Cash Equivalents, Beginning of Period


449.7



129.7



325.7



93.9Cash and Cash Equivalents, End of Period

$
442.5


$
191.4


$
442.5


$
191.4Cash and cash equivalents comprised of:Cash

$
11.3


$
25.7


$
11.3


$
25.7Short-term investments


431.2



165.7



431.2



165.7$
442.5


$
191.4


$
442.5


$
191.4Supplemental cash flow disclosureInterest paid

$
15.7


$
24.4


$
71.5


$
74.5Income taxes paid

$
59.1


$
18.7


$
128.2


$
243.2     4




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##### Table of Contents



Potash
    Corporation of Saskatchewan Inc.
  Condensed
    Consolidated Statements of Comprehensive Income
 (in millions of US dollars)
 (unaudited)
  Three Months EndedSeptember 30, 2007Before





Net ofIncome


Income


IncomeTaxes


Taxes


TaxesNet income

$
393.5


$
150.4


$
243.1Other comprehensive incomeNet increase in unrealized gains on
    available-for-sale
    securities(1)


281.5



23.4



258.1Net losses on derivatives designated as cash flow
    hedges(2)


(17.0
)


(4.7
)


(12.3
)Reclassification to income of gains on cash flow
    hedges(2)


(8.5
)


(3.7
)


(4.8
)Unrealized foreign exchange gains on translation of
    self-sustaining foreign operations


1.0



-



1.0Other comprehensive income


257.0



15.0



242.0Comprehensive income

$
650.5


$
165.4


$
485.1 Nine Months EndedSeptember 30, 2007Before





Net ofIncome


Income


IncomeTaxes


Taxes


TaxesNet income

$
1,077.8


$
351.0


$
726.8Other comprehensive incomeNet increase in unrealized gains on
    available-for-sale
    securities(1)


844.7



57.4



787.3Net gains on derivatives designated as cash flow
    hedges(2)


13.9



4.6



9.3Reclassification to income of gains on cash flow
    hedges(2)


(39.8
)


(13.1
)


(26.7
)Unrealized foreign exchange gains on translation of
    self-sustaining foreign operations


5.9



-



5.9Other comprehensive income


824.7



48.9



775.8Comprehensive income

$
1,902.5


$
399.9


$
1,502.6   (1)
    
    Available-for-sale
    securities are comprised of shares in Israel Chemicals Ltd.,
    Sinofert Holdings Limited and other short-term investments(2)
    
    Natural gas derivative instruments    5




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##### Table of Contents



Potash
    Corporation of Saskatchewan Inc.
    Notes to the Condensed Consolidated Financial Statements
    For the Three and Nine Months Ended September 30, 2007
    (in millions of US dollars except share and per-share
    amounts)
    (unaudited)
  1.
    Significant
    Accounting Policies  Basis
    of Presentation
      Changes
    in Accounting Policies
  Comprehensive
    Income, Equity, Financial Instruments and Hedges
    
    Financial assets are classified as loans and receivables,
    held-to-maturity,
    held-for-trading
    or
    available-for-sale.
    Loans and receivables include all loans and receivables except
    debt securities and are accounted for at amortized cost.
    Held-to-maturity
    classification is restricted to fixed maturity instruments that
    the company intends and is able to hold to maturity and are
    accounted for at amortized cost.
    Held-for-trading
    instruments include all derivative financial instruments not
    included in a hedging relationship and any designated
    instruments and are recorded at fair value with realized and
    unrealized gains and losses reported in net income. The
    remaining financial assets are classified as
    available-for-sale.
    These are recorded at fair value with unrealized gains and
    losses reported in a new category of the Consolidated Statements
    of Financial Position under shareholders equity called
    accumulated other comprehensive income (AOCI);
    Financial liabilities are classified as either
    held-for-trading
    or other.
    Held-for-trading
    instruments are recorded at fair value with realized and
    unrealized gains and losses reported in net income. Other
    instruments are accounted for at amortized cost with gains and
    losses reported in net income in the period that the liability
    is derecognized; and
    Derivative instruments (derivatives) are classified
    as
    held-for-trading
    unless designated as hedging instruments. All derivatives are
    recorded at fair value on the Consolidated Statements of
    Financial Position. For derivatives that hedge the changes in
    fair value of an asset or liability, changes in the
    derivatives fair value are reported in net income and are
    substantially offset by changes in the fair value of the hedged
    asset or liability attributable to the risk being hedged. For
    derivatives that hedge variability in 6




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##### Table of Contents



cash flows, the effective portion of the changes in the
    derivatives fair value are initially recognized in other
    comprehensive income (OCI) and the ineffective
    portion is recorded in net income. Amounts temporarily recorded
    in AOCI will subsequently be reclassified to net income in the
    periods when net income is affected by the variability in the
    cash flows of the hedged item.    (1)
    Available-for-sale
    securities  
    The companys investments in Israel Chemicals Ltd.
    (ICL) and Sinofert Holdings Limited
    (Sinofert) have been classified as
    available-for-sale
    and recorded at fair value in the Consolidated Statements of
    Financial Position, resulting in an increase in investments of
    $887.8, an increase to AOCI of $789.6 and an increase in future
    income tax liability of $98.2;  (2)
    Deferred debt costs  
    Bond issue costs were reclassified from other assets to
    long-term debt and deferred swap gains were reclassified from
    other non-current liabilities to long-term debt, resulting in a
    reduction in other assets of $23.9, a reduction in other
    non-current liabilities of $6.6 and a reduction in long-term
    debt of $17.3;  (3)
    Natural gas derivatives  
    The company employs futures, swaps and option agreements to
    establish the cost of a portion of its natural gas requirements.
    These derivative instruments generally qualify for hedge
    accounting. Derivative instruments were recorded on the
    Consolidated Statements of Financial Position at fair value
    resulting in an increase in current portion of derivative
    instrument assets of $50.9, an increase in derivative instrument
    assets (non-current) of $69.4, an increase in future income tax
    liability of $45.6 and an increase in AOCI of $74.7;
    Hedge ineffectiveness on these derivative instruments was
    recorded as a cumulative effect adjustment to opening retained
    earnings, net of tax, resulting in an increase in retained
    earnings of $0.2 and a decrease in AOCI of $0.2. The effect on
    basic and diluted earnings per share was not significant; and
    Deferred realized hedging gains were reclassified from inventory
    to AOCI resulting in an increase in inventory of $8.0, an
    increase in future income tax liability of $3.1 and an increase
    in AOCI of $4.9.  Accounting
    Changes
    Stripping
    Costs Incurred in the Production Phase of a Mining
    Operation
   7




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##### Table of Contents



unit-of-production
  Recent
    Accounting Pronouncements
  Determining
    the Variability to be Considered in Applying the Variable
    Interest Entity Standards
    Capital
    Disclosures
    Financial
    Instruments
        Inventories
   8




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##### Table of Contents



International
    Financial Reporting Standards
    2.
    Other
    Short-term Investments  available-for-sale.
  3.
    Inventories  September 30,


December 31,2007


2006Finished products

$
191.6


$
237.1Intermediate products


75.2



98.5Raw materials


60.0



62.4Materials and supplies


106.5



103.3$
433.3


$
501.3   4.
    Investments      5.
    Financial
    Instruments and Risk Management  Accounting
    Policies
  Financial
    Assets and Liabilities
  held-to-maturity, held-for-trading, available-for-sale. held-for-trading Held-for-trading held-for-trading. Available-for-sale
  held-for-trading available-for-sale available-for-sale
 9




---



##### Table of Contents



Derivative
    Financial Instruments and Hedging
            marked-to-market
 10




---



##### Table of Contents



Fair
    Value
  point-in-time available-for-sale available-for-sale
  Other
    Short-term Investments
      Investments
  available-for-sale
      Supplemental
    Disclosures
   11




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##### Table of Contents



held-for-trading.
   12




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##### Table of Contents



Fair
    Value
    6.
    Long-term
    Debt  back-to-back
    September 30


December 312007


2006Effective InterestRate(1)Notes Payable7.125% notes payable June 15, 2007

$
-



-


$
400.07.750% notes payable May 31, 2011


600.0



7.65
%


600.04.875% notes payable March 1, 2013


250.0



5.08
%


250.05.875% notes payable December 1, 2036


500.0



6.11
%


500.0Other


7.1



7.60
%


7.51,357.1







1,757.5Less: Net unamortized debt costs


(25.0
)






-Add: Unamortized swap gains


5.6







-1,337.7







1,757.5Less: Current maturities


(0.2
)






(400.4
)Add: Current portion of
    amortization(2)


0.4







-$
1,337.9






$
1,357.1   (1)
    
    The effective interest rate by
    instrument includes the impact of swap gains and debt costs.(2)
    
    The current portion of amortization
    of debt costs is included in Prepaid expenses and other current
    assets.  7.
    Share
    Capital  three-for-one Form 10-Q,
 13




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##### Table of Contents



Quarterly Data (Post Split Basis)

First Quarter


Second Quarter


Third Quarter


Fourth Quarter


YearBasic net income per share2007

$
0.63


$
0.91


$
0.772006

$
0.40


$
0.56


$
0.47


$
0.59


$
2.032005

$
0.39


$
0.50


$
0.40


$
0.37


$
1.67Diluted net income per share2007

$
0.62


$
0.88


$
0.752006

$
0.40


$
0.55


$
0.46


$
0.58


$
1.982005

$
0.38


$
0.49


$
0.39


$
0.36


$
1.63     8.
    Accumulated
    Other Comprehensive Income    Net


UnrealizedNet


unrealized


foreignunrealized


gains on


exchange gains


Totalholding gains


derivatives


on self-


Accumulatedon available-


designated as


sustaining


Otherfor-sale


cash flow


foreign


Comprehensivesecurities


hedges


operations


IncomeCumulative effect adjustment at January 1, 2007
    (Note 1)

$
789.6


$
79.4


$
-


$
869.0Increase (decrease) for the nine months ended September 30,
    2007


787.3



(17.4
)


5.9



775.8Accumulated other comprehensive income, September 30,
    2007

$
1,576.9


$
62.0


$
5.9



1,644.8Retained Earnings, September 30, 2007














1,934.4Accumulated other comprehensive income and retained earnings,
    September 30, 2007

$
3,579.2   9.
    Income
    Taxes    
    A scheduled 2-percentage point reduction in the Canadian federal
    income tax rate applicable to resource companies, effective at
    the beginning of 2007, was more than offset by a higher
    percentage of consolidated income earned in higher-tax
    jurisdictions during the three and nine months ended
    September 30, 2007, compared to the same periods in 2006.
    As a result of the increasing proportion of consolidated income
    earned in higher-tax jurisdictions, during the third quarter of
    2007, it was determined that the consolidated effective rate for
    the year had increased from 30 percent to 33 percent.
    The reported income tax rate for the third quarter of 2007 is
    higher than the effective rate as the impact of this change on
    prior periods, as applicable, was reflected during the quarter.
    During the second quarter of 2007, the Government of Canada
    enacted a reduction of the federal corporate income tax rate to
    18.5 percent by 2011. This reduction was in addition to
    changes enacted by the Government of Canada in the second
    quarter of 2006 to reduce the federal corporate income tax rate
    from 14




---



##### Table of Contents



23 percent in 2006 to 19 percent by 2010 and reduce
    the federal corporate surtax from 1.12 percent to nil in
    2008. These changes reduced the companys future income tax
    liability by $4.7 in the second quarter of 2007 and $22.9 in the
    second quarter of 2006.  
    In addition to the federal changes noted above, the Province of
    Saskatchewan enacted changes to the corporate income tax during
    the quarter ended June 30, 2006, reducing the rate from
    17 percent to 12 percent by 2009. These changes resulted in
    a $21.9 reduction in the companys future income tax
    liability in the second quarter of 2006.
    Income tax refunds totaling $22.4 for the 1999 and 2001-2004
    taxation years were recorded during the nine months ended
    September 30, 2006, $6.6 of which was recognized during the
    third quarter of 2006. The refunds related to a Canadian appeal
    court decision (pertaining to a uranium producer) which affirmed
    the deductibility of the Saskatchewan capital tax resource
    surcharge.  10.
    Net
    Income Per Share      11.
    Segment
    Information    Three Months Ended September 30, 2007Potash


Nitrogen


Phosphate


All Others


ConsolidatedSales

$
427.4


$
436.0


$
431.6


$
-


$
1,295.0Freight


38.3



15.4



26.9



-



80.6Transportation and distribution


8.7



12.9



9.4



-



31.0Net sales  third party


380.4



407.7



395.3



-Cost of goods sold


159.1



283.8



265.4



-



708.3Gross margin


221.3



123.9



129.9



-



475.1Depreciation and amortization


15.5



22.2



29.3



2.5



69.5Inter-segment sales


-



25.0



-



-



-   15




---



##### Table of Contents



Three Months Ended September 30, 2006Potash


Nitrogen


Phosphate


All Others


ConsolidatedSales

$
334.3


$
292.6


$
326.6


$
-


$
953.5Freight


33.6



9.4



22.6



-



65.6Transportation and distribution


10.5



13.4



13.7



-



37.6Net sales  third party


290.2



269.8



290.3



-Cost of goods sold


136.6



207.4



260.5



-



604.5Gross margin


153.6



62.4



29.8



-



245.8Depreciation and amortization


16.4



19.5



23.3



3.0



62.2Inter-segment sales


0.2



25.4



0.9



-



-   Nine Months Ended September 30, 2007Potash


Nitrogen


Phosphate


All Others


ConsolidatedSales

$
1,318.1


$
1,336.8


$
1,147.9


$
-


$
3,802.8Freight


135.0



40.0



79.8



-



254.8Transportation and distribution


30.9



39.1



24.6



-



94.6Net sales  third party


1,152.2



1,257.7



1,043.5



-Cost of goods sold


496.3



858.3



752.6



-



2,107.2Gross margin


655.9



399.4



290.9



-



1,346.2Depreciation and amortization


54.4



65.5



88.6



7.8



216.3Inter-segment sales


-



84.1



1.9



-



-   Nine Months Ended September 30, 2006Potash


Nitrogen


Phosphate


All Others


ConsolidatedSales

$
856.5


$
966.9


$
920.4


$
-


$
2,743.8Freight


91.4



28.1



63.3



-



182.8Transportation and distribution


28.9



40.3



35.4



-



104.6Net sales  third party


736.2



898.5



821.7



-Cost of goods sold


359.0



665.0



729.7



-



1,753.7Gross margin


377.2



233.5



92.0



-



702.7Depreciation and amortization


43.2



57.8



70.5



9.9



181.4Inter-segment sales


5.0



85.8



5.5



-



-   12.
    Stock-Based
    Compensation    Expected dividend


$0.40Expected volatility


29%Risk-free interest rate


4.48%Expected life of options


6.4 years  16




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##### Table of Contents



13.
    Pension
    and Other Post-Retirement Expenses  Three Months


Nine MonthsEnded September 30


Ended September 30Defined Benefit Pension
    Plans

2007


2006


2007


2006Service cost

$
3.9


$
3.6


$
11.5


$
10.8Interest cost


9.1



8.5



27.3



25.3Expected return on plan assets


(10.7
)


(9.7
)


(32.1
)


(28.9
)Net amortization and change in valuation allowance


3.2



3.5



9.6



10.4Net expense

$
5.5


$
5.9


$
16.3


$
17.6   Three Months


Nine MonthsEnded September 30


Ended September 30Other Post-Retirement
    Plans

2007


2006


2007


2006Service cost

$
1.5


$
1.1


$
4.4


$
3.5Interest cost


3.6



3.2



10.6



9.3Net amortization


0.1



(0.1
)


0.4



(0.3
)Net expense

$
5.2


$
4.2


$
15.4


$
12.5     14.
    Other
    Income  Three Months


Nine MonthsEnded September 30


Ended September 302007


2006


2007


2006Share of earnings of equity investees

$
15.4


$
10.6


$
58.2


$
39.0Dividend income


8.8



9.0



47.5



21.1Other


4.9



1.5



5.6



12.2$
29.1


$
21.1


$
111.3


$
72.3   15.
    Interest
    Expense  Three Months


Nine MonthsEnded September 30


EndedSeptember 302007


2006


2007


2006Interest expense onShort-term debt

$
1.9


$
11.9


$
7.7


$
28.5Long-term debt


24.4



23.7



86.3



70.7Interest capitalized to property, plant and equipment


(5.7
)


(4.0
)


(14.5
)


(13.3
)Interest income


(7.9
)


(6.4
)


(20.5
)


(16.8
)$
12.7


$
25.2


$
59.0


$
69.1  17




---



##### Table of Contents



16.
    Seasonality    17.
    Contingencies  Canpotex
    Mining
    Risk
    Investment
    in Arab Potash Company Ltd. (APC)
    Legal
    and Other Matters
     18




---



##### Table of Contents



19




---



##### Table of Contents



18.
    Guarantees    back-to-back
     20




---



##### Table of Contents



19.
    Reconciliation
    of Canadian and United States Generally Accepted Accounting
    Principles    (a) Long-term investments: available-for-sale
    (b) Property, plant and equipment and goodwill:
  (c) Depreciation and amortization:
  (d) Exploration costs:
  (e) Pre-operating costs: start-up start-up
  (f) Pension and other post-retirement benefits:
 21




---



##### Table of Contents



(g) Foreign currency translation adjustment:
  (h) Derivative instruments and hedging activities:
    (i) Comprehensive income:
  (j) Stock-based compensation:
   22




---



##### Table of Contents



(k) Stripping costs
  (l) Income taxes related to the above adjustments:
  (m) Income tax consequences of stock-based employee
    compensation:
  (n) Income taxes related to uncertain income tax
    positions:
  (o) Cash flow statements:
  The application of US GAAP, as described above, would have
    had the following effects on net income, net income per share,
    total assets, shareholders equity and comprehensive
    income.
  Three Months


Nine MonthsEnded September 30


Ended September 302007


2006


2007


2006Net income as reported  Canadian GAAP

$
243.1


$
145.2


$
726.8


$
445.8Items increasing (decreasing) reported net incomeCash flow hedge ineffectiveness


-



(4.8
)


-



(4.2
)Depreciation and amortization


2.1



2.1



6.3



6.3Stock-based compensation


(1.4
)


(0.4
)


(0.4
)


1.5Stripping costs


(0.5
)


3.4



(8.8
)


5.6Share of earnings of equity investees


(0.6
)


-



(1.2
)


0.5Pension and other post-retirement benefits


0.7



-



2.1



-Deferred income taxes related to the above adjustments


(0.1
)


(3.1
)


0.5



5.2Income taxes related to US GAAP effective rate


13.6



-



-



- 23




---



##### Table of Contents



Three Months


Nine MonthsEnded September 30


Ended September 302007


2006


2007


2006Income taxes related to stock-based compensation


(3.4
)


(2.8
)


(11.4
)


(7.2
)Income taxes related to uncertain income tax positions


25.4



-



23.4



-Net income  US GAAP

$
278.9


$
139.6


$
737.3


$
453.5Basic weighted average shares outstanding  US GAAP


315,458,000



311,721,000



315,444,000



311,344,000Diluted weighted average shares outstanding  US GAAP


323,349,000



318,134,000



323,563,000



317,801,000Basic net income per share  US GAAP

$
0.88


$
0.45


$
2.34


$
1.46Diluted net income per share  US GAAP

$
0.86


$
0.44


$
2.28


$
1.43   September 30,


December 31,2007


2006Total assets as reported  Canadian GAAP

$
8,624.3


$
6,217.0Items increasing (decreasing) reported total assetsInventory


-



8.0Available-for-sale
    securities (unrealized holding gains and losses)


-



889.9Fair value of derivative instruments


-



120.3Property, plant and equipment


(103.4
)


(109.7
)Exploration costs


(6.4
)


(6.4
)Stripping costs


(30.6
)


(21.8
)Deferred debt costs


-



(23.9
)Pension and other post-retirement benefits


(34.0
)


6.7Investment in equity investees


3.0



5.5Income tax asset related to uncertain income tax positions


26.5



-Goodwill


(46.7
)


(46.7
)Total assets  US GAAP

$
8,432.7


$
7,038.9   September 30,


December 31,2007


2006Total shareholders equity as reported  Canadian
    GAAP

$
5,130.5


$
2,780.3Items increasing (decreasing) reported shareholders equityAccumulated other comprehensive income, net of related income
    taxes, consisting of:Unrealized gains and losses on
    available-for-sale
    securities


-



792.0Gains and losses on derivatives designated as cash flow hedges


-



79.4Cumulative-effect adjustment in respect of uncertain tax
    positions


(1.2
)


-Pension and other post-retirement benefits


(112.1
)


(117.9
)Share of accumulated other comprehensive income of equity
    investees


-



0.9Foreign currency translation adjustment


(20.9
)


(20.9
)Foreign currency translation adjustment


20.9



20.9Provision for asset impairment


(218.0
)


(218.0
)Depreciation and amortization


67.9



61.6Exploration costs


(6.4
)


(6.4
)Stripping costs


(30.6
)


2.6 24




---



##### Table of Contents



September 30,


December 31,2007


2006Cash flow hedge ineffectiveness


-



0.4Pension and other post-retirement benefits


18.2



16.1Share of earnings of equity investees


3.0



4.2Deferred income taxes relating to the above adjustments


32.8



24.0Income taxes related to uncertain income tax positions


23.4



-Cumulative-effect adjustment to retained earnings in respect of
    stripping costs


-



(16.3
)Cumulative-effect adjustment to retained earnings in respect of
    uncertain income tax positions


57.5



-Shareholders equity  US GAAP

$
4,965.0


$
3,402.9   Nine MonthsEnded September 302007


2006Net income  US GAAP

$
737.3


$
453.5Other comprehensive incomeIncrease in unrealized gains on
    available-for-sale
    securities


842.6



302.2Net gains (losses) on derivatives designated as cash flow hedges


13.9



(58.7
)Reclassification to income of (gains) losses on cash flow hedges


(39.8
)


(51.6
)Unrealized foreign exchange gains on translation of
    self-sustaining foreign operations


5.9



-Pension and other post-retirement benefits


8.7



-Share of OCI of equity investees


(1.3
)


0.2Deferred income taxes related to other comprehensive income


(51.7
)


22.2Other comprehensive income, net of related income taxes


778.3



214.3Comprehensive income  US GAAP

$
1,515.6


$
667.8   Supplemental
    US GAAP Disclosures
  Recent
    Accounting Pronouncements
  Uncertainty
    in Income Taxes
     25




---



##### Table of Contents



YearsCanada


1997-presentUS


2001-presentTrinidad


1999-presentBarbados


1999-present   Definition
    of Settlement Under FIN No. 48
    Planned
    Major Maintenance Activities
  AIR-1, accrue-in-advance AIR-1,
  Framework
    for Fair Value Measurement
    Fair
    Value Option for Financial Assets and Financial Liabilities
    20.  Comparative
    Figures
   26




---



##### Table of Contents



ITEM
    2.
    MANAGEMENTS
    DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
    OPERATIONS  Form 10-K,
  POTASHCORP
    AND OUR BUSINESS ENVIRONMENT
        POTASHCORP
    VISION
      POTASHCORP
    STRATEGY
     27




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##### Table of Contents



KEY
    PERFORMANCE DRIVERS  PERFORMANCE COMPARED TO
    GOALS
    
    management will focus on the most important things, which will
    be reinforced by having the measurable, relevant results readily
    accessible;
    employees will understand and be able to effectively monitor
    their contribution to the achievement of corporate goals; and
    we will be even more effective in meeting our targets.    Representative


PerformanceGoal


2007 Annual Target


to September 30,
    2007To continue to outperform our sector and other basic materials
    companies in total shareholder return.


Exceed total shareholder return performance for our sector and
    companies on the DJUSBM for 2007.


PotashCorps total shareholder return was 121 percent in
    the first nine months of 2007, exceeding the DJUSBM return of 25
    percent and our sector average return of 70 percent.To be the low-cost supplier on a delivered basis in our industry
    through ongoing cost reduction management.


Achieve 3-percent reduction in per-tonne potash conversion costs
    on a Canadian dollar basis.


Potash conversion costs were reduced 2 percent per tonne on a
    Canadian dollar basis during the first nine months of 2007 when
    compared to the 2006 annual average. Compared to the nine months
    ended September 30, 2006, per-tonne potash conversion costs were
    reduced 7 percent.Improve energy efficiency in Trinidad by 3 percent from 2006.


Trinidad energy efficiency rate improved almost 3 percent during
    the first nine months of 2007 compared to the 2006 annual
    average.Achieve rock costs at Aurora and White Springs 1 percent below
    2006.


Rock costs at Aurora increased 3 percent and White Springs
    increased 1 percent during the first nine months of 2007
    compared to the 2006 annual average. Compared to the first nine
    months of 2006, per-tonne rock costs increased 2 percent at
    Aurora and 3 percent at White Springs.   28




---



##### Table of Contents



Representative


PerformanceGoal


2007 Annual Target


to September 30,
    2007To remain the leader and preferred supplier of potash, nitrogen
    and phosphate products worldwide.


Potash gross margin to exceed $800 million, more than 40 percent
    above 2006.


Potash gross margin was $655.9 million for the first nine months
    of 2007, representing 82 percent of the 2007 annual target and
    an increase of 74 percent compared to the first nine months of
    2006.Phosphate gross margin to be up by 50 percent from 2006.


Phosphate gross margin was $290.9 million, up 216 percent for
    the first nine months of 2007 compared to the corresponding
    period in 2006. This nine-month gross margin represents 155
    percent of the 2007 annual target.Nitrogen gross margin to exceed $325 million.


Nitrogen gross margin was $399.4 million for the first nine
    months of 2007, representing 123 percent of the 2007 annual
    target and an increase of 71 percent compared to the first nine
    months of 2006.To move closer to our goal of no harm to people, no accidents,
    no damage to the environment.


Reduce recordable injury rate by 15 percent from 2006.


Recordable injury rate increased 13 percent for the first nine
    months of 2007 compared to the 2006 annual level. As compared to
    the nine months ended September 30, 2006, recordable injury rate
    increased 16 percent.Reduce lost-time injury rate by 40 percent from 2006.


Lost-time injury rate was reduced 74 percent for the first nine
    months of 2007 as compared to the 2006 annual level. As compared
    to the nine months ended September 30, 2006, lost-time injury
    rate was reduced 71 percent.Reduce reportable releases and permit excursions by 10 percent
    from 2006.


Reportable release rate on an annualized basis declined 11
    percent while annualized permit excursions were down 50 percent
    during the first nine months of 2007 compared to 2006 annual
    levels. Compared to the first nine months of 2006, reportable
    releases dropped 25 percent while permit excursions were reduced
    57 percent.  29




---



##### Table of Contents



FINANCIAL
    OVERVIEW
  Form 10-Q. Three-for-One three-for-one
    Three-for-One
    Stock Split
  three-for-one Form 10-Q,
  First


Second


Third


FourthQuarterly Data (Post Split Basis)

Quarter


Quarter


Quarter


Quarter


YearBasic net income per share2007

$
0.63


$
0.91


$
0.772006

$
0.40


$
0.56


$
0.47


$
0.59


$
2.032005

$
0.39


$
0.50


$
0.40


$
0.37


$
1.67Diluted net income per share2007

$
0.62


$
0.88


$
0.752006

$
0.40


$
0.55


$
0.46


$
0.58


$
1.982005

$
0.38


$
0.49


$
0.39


$
0.36


$
1.63     Earnings
    Guidance
   30




---



##### Table of Contents



Overview
    of Actual Results
  Operations
  Three Months Ended September 30

Nine Months Ended September 30Dollar

%





Dollar

%(Dollars millions  except per-share amounts)

2007

2006

Change

Change

2007

2006

Change

ChangeSales

$
1,295.0


$
953.5


$
341.5



36


$
3,802.8


$
2,743.8


$
1,059.0



39Freight


80.6



65.6



15.0



23



254.8



182.8



72.0



39Transportation and distribution


31.0



37.6



(6.6
)


(18
)


94.6



104.6



(10.0
)


(10
)Cost of goods sold


708.3



604.5



103.8



17



2,107.2



1,753.7



353.5



20Gross margin

$
475.1


$
245.8


$
229.3



93


$
1,346.2


$
702.7


$
643.5



92Operating income

$
406.2


$
223.2


$
183.0



82


$
1,136.8


$
610.0


$
526.8



86Net income

$
243.1


$
145.2


$
97.9



67


$
726.8


$
445.8


$
281.0



63Net income per share  basic

$
0.77


$
0.47


$
0.30



64


$
2.30


$
1.43


$
0.87



61Net income per share  diluted

$
0.75


$
0.46


$
0.29



63


$
2.25


$
1.40


$
0.85



61     stocks-to-use
   31




---



##### Table of Contents



Balance
    Sheet
    
    The fair value of
    available-for-sale
    investments are recorded as assets on the Consolidated
    Statements of Financial Position. The company has classified its
    investments in ICL and Sinofert as
    available-for-sale
    and therefore has recorded these investments at their fair
    value, resulting in a balance of unrealized holding gains in
    investments of $1,752.5 million, accumulated other
    comprehensive income of $1,590.3 million and future income
    tax liability of $162.2 million as of September 30,
    2007. The total balance recorded in investments related to ICL
    and Sinofert as of September 30, 2007 was
    $2,143.9 million. In previous periods these investments had
    been recorded at cost which, as of December 31, 2006 and
    September 30, 2007, was $167.7 million for ICL and
    $223.7 million for Sinofert.
    Derivative instruments are generally recorded on the
    Consolidated Statements of Financial Position at fair value. At
    September 30, 2007, the fair value of the companys
    derivative instrument assets represented a current asset of
    $41.4 million and a long-term asset of $73.5 million.
    Of the total, $104.4 million related to natural gas swap,
    option and physical gas purchase contracts, with
    $103.8 million of the swap contracts designated as
    accounting hedges; $10.5 million related to foreign
    currency forward contracts. As of December 31, 2006, no
    such derivative instrument assets were recorded on the balance
    sheet. As of September 30, 2007, the current portion of
    derivative instrument liabilities of $0.8 million related
    to natural gas futures contracts was included in accounts
    payable and accrued charges and $1.0 million was included
    in other long-term liabilities. Gains of $62.0 million on
    the contracts designated as accounting hedges have been
    recognized in accumulated other comprehensive income, net of
    income taxes, as of September 30, 2007, to the extent those
    hedges are effective; ineffectiveness of $0.9 million
    arising from January 1 to September 30, 2007 has been
    recognized through net income, including a net reduction to the
    total of $0.3 million recognized during the third quarter.
    The future income tax liability associated with these
    instruments was $40.1 million. Net realized and unrealized
    gains recognized in net income on physical gas purchase
    contracts and options not qualifying for hedge accounting
    arising from January 1 to September 30, 32




---



##### Table of Contents



2007 were insignificant; no amounts were recorded in net income
    during the first nine months of 2006. Hedge ineffectiveness
    existing on derivative instruments as of January 1, 2007
    was recorded as a cumulative effect adjustment to opening
    retained earnings, net of income tax, resulting in an increase
    in retained earnings of $0.2 million and a decrease in
    accumulated other comprehensive income of $0.2 million.  
    Bond issue costs were reclassified from other assets to
    long-term debt and deferred swap gains were reclassified from
    other non-current liabilities to long-term debt, resulting in a
    reduction in other assets of $23.9 million, a reduction in
    other non-current liabilities of $6.6 million and a
    reduction in long-term debt of $17.3 million at
    January 1, 2007. These costs are amortized using the
    effective interest rate method, and will continue to be
    amortized over the term of the related liability. As of
    September 30, 2007, unamortized bond issue costs decreased
    long-term debt by $25.0 million while unamortized deferred
    swap gains increased long-term debt by $5.6 million.  available-for-sale.
    available-for-sale
  10-year
   33




---



##### Table of Contents



available-for-sale
  Business
    Segment Review
      Potash
  Three Months Ended September 30Dollars (millions)


Tonnes (thousands)


Average Price per
    Tonne(1)2007


2006


% Change


2007


2006


% Change


2007


2006


% ChangeSales

$
427.4


$
334.3



28Freight


38.3



33.6



14Transportation and distribution


8.7



10.5



(17
)Net Sales

$
380.4


$
290.2



31Manufactured productNet salesNorth American

$
138.4


$
108.8



27



710



673



5


$
194.82


$
161.89



20Offshore


239.7



179.4



34



1,442



1,410



2


$
166.20


$
127.22



31378.1



288.2



31



2,152



2,083



3


$
175.64


$
138.42



27Cost of goods sold


157.2



134.8


















$
22.45


$
29.63



(24
)Gross margin


220.9



153.4


















$
153.19


$
108.79



41Other miscellaneous and 
    purchased productNet sales


2.3



2.0



15Cost of goods sold


1.9



1.8



6Gross margin


0.4



0.2



100Gross margin

$
221.3


$
153.6



44














$
153.47


$
108.94



41   34




---



##### Table of Contents



Nine Months Ended September 30Dollars (millions)


Tonnes (thousands)


Average Price per
    Tonne(1)2007


2006


% Change


2007


2006


% Change


2007


2006


% ChangeSales

$
1,318.1


$
856.5



54Freight


135.0



91.4



48Transportation and distribution


30.9



28.9



7Net sales

$
1,152.2


$
736.2



57Manufactured productNet salesNorth American

$
482.0


$
329.9



46



2,653



1,939



37


$
181.63


$
170.13



7Offshore


661.8



398.6



66



4,477



3,093



45


$
147.82


$
128.88



151,143.8



728.5



57



7,130



5,032



42


$
160.40


$
144.77



11Cost of goods sold


490.3



353.6


















$
68.75


$
70.27



(2
)Gross margin


653.5



374.9


















$
91.65


$
74.50



23Other miscellaneous and purchased productNet sales


8.4



7.7



9Cost of goods sold


6.0



5.4



11Gross margin


2.4



2.3



4Gross margin

$
655.9


$
377.2



74














$
91.99


$
74.96



23   (1)
    
    Rounding differences may occur due
    to the use of whole dollars in per-tonne calculations.  Highlights
  
    Potash gross margins of $221.3 million for the third
    quarter and $655.9 million for the first nine months of
    2007 were 44 percent and 74 percent higher than the same
    periods in 2006, respectively. Compared to 2005, which was prior
    to the extended price negotiations with China and India that
    negatively impacted last years third quarter and first
    nine months, third-quarter gross margin was 32 percent
    higher than third-quarter 2005 while the first nine months of
    2007 exceeded the same period in 2005 by 16 percent.
    Potash sales volumes were higher in third-quarter and the first
    nine months of 2007 compared to the same periods in 2006 in both
    the North American and offshore markets.
    Farmers outside of North America are working to correct decades
    of under-application of potash, and while this will take many
    more years to accomplish, potash is vital to improving crop
    quality and gives plants the capability to better utilize
    nitrogen and phosphate. This has taken reported potash producer
    inventories to historically low levels and contributed to
    further offshore spot-market price increases during the quarter.
    Even with production 27 percent higher than in the third
    quarter of 2006, our quarter-end potash inventories were
    41 percent below the levels at the same time last year and
    44 percent lower than at the end of the second quarter of
    2007.
    To meet increasing global demand, we raised our production to
    1.8 million tonnes for the third quarter and
    6.6 million tonnes for the first nine months of 2007; this
    compares to 1.4 million tonnes in the third quarter and
    4.6 million tonnes in the first nine months of 2006. As a
    result of higher production levels, cost of goods per tonne sold
    dropped despite additional costs for our share of brine inflow
    management at Esterhazy, higher brine inflow management costs at
    New Brunswick, and general price escalations of production
    inputs. 35




---



##### Table of Contents



Manufactured
    potash gross margin variance attributable to:
  Three Months Ended September 30



Nine Months Ended September 30Dollars (millions)

2007 vs. 2006



2007 vs. 2006Change in











Change inPrices/Costs











Prices/CostsChange in







Total Gross



Change in







Total GrossSales






Cost of



Margin



Sales






Cost of



MarginVolumes



Net Sales


Goods Sold



Variance



Volumes



Net Sales


Goods Sold



VarianceManufactured productNorth America

$
4.4



$
23.4


$
(4.7
)


$
23.1



$
87.7



$
30.5


$
(9.4
)


$
108.8Offshore


2.6




56.2



(14.5
)



44.3




110.3




84.8



(25.3
)



169.8Change in market mix


(0.3
)



0.5



(0.1
)



0.1




4.6




(3.9
)


(0.7
)



-Total

$
6.7



$
80.1


$
(19.3
)


$
67.5



$
202.6



$
111.4


$
(35.4
)


$
278.6   Sales and
    Cost of Goods Sold
    
    While record ocean freights have been a challenge for our
    business, offshore realized prices increased 31 percent
    ($39 per tonne) from last years third quarter and
    17 percent ($24 per tonne) from the trailing quarter. For
    the first time this year, price increases in most markets are
    finally exceeding increases in ocean freight costs. This can be
    seen in higher spot-market prices paid by Brazil and Southeast
    Asia. However, in India, ocean freight costs have offset most of
    the $50-per-tonne price improvement negotiated there earlier in
    the year. China continued to benefit from its 2007 contract
    price, which is considerably below the current spot market.
    North American realized prices also improved by 20 percent ($33
    per tonne) as a result of strong fertilizer demand. Prices in
    the North American market were $29 per tonne, or
    17 percent, higher than offshore prices. The gap between
    the two markets is due in part to offshore contracts with prices
    that lag behind the North American spot market price. The gap
    also reflects product mix, as North American customers prefer
    granular product that commands a premium over standard product
    more typically consumed offshore.
    Exceptionally tight potash market conditions led to products
    being sold on an allocation basis to all customers for much of
    the quarter. Total potash sales volumes of 2.15 million
    tonnes were up 3 percent from last year. Our offshore sales
    volumes reached 1.44 million tonnes, a 2-percent increase
    over last year. Canpotex Limited (Canpotex), the
    offshore marketing company for Saskatchewan potash producers,
    shipped 2.31 million tonnes in the quarter, including
    0.61 million tonnes to China  a 28-percent
    increase over the same quarter last year  and
    0.53 million tonnes to other Southeast Asian countries,
    representing a 16-percent increase. Canpotex shipments to Brazil
    (0.54 million tonnes) declined 15 percent, largely
    because of delays in moving product through that countrys
    congested port system and tight supply conditions. In North
    America, potash sales volumes were up 5 percent as our
    market share there increased 9 percent.
    Cost of goods sold was negatively affected by the strength of
    the Canadian dollar, which added almost $4 per tonne, while
    continuing brine inflow costs at New Brunswick and Esterhazy had
    an impact of almost $11 per tonne on all tonnes sold, an
    increase of $8 per tonne ($17.4 million) compared to last
    years costs. Since the costs of brine inflow were
    attributed to production of potash for which a greater
    proportion was sold in the offshore market, the price component
    of the cost of goods sold variance was higher for the offshore
    market than for North America. Prices for supplies and services
    throughout the year further increased costs, though the impacts
    were partially offset by the effect of increased production.    
    Canpotex shipped almost 7.0 million tonnes through the
    first nine months of 2007  more than was shipped in
    all of 2006  as all major markets have increased
    consumption. In its most significant markets (China, India and
    Brazil), Canpotex sales increased from 1.80 million to
    4.04 million tonnes. China took 36




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##### Table of Contents



1.83 million tonnes as compared to 0.54 million tonnes
    during the first nine months of 2006 as the country waited to
    conclude new pricing contracts with suppliers, including
    Canpotex, before coming back into the market for new tonnage. In
    addition, India took 0.72 million tonnes versus
    0.36 million tonnes in the first nine months of 2006, while
    Brazil purchased approximately 1.49 million tonnes in the
    first nine months of 2007 versus 0.90 million tonnes in the
    same period last year. Higher soybean prices in Brazil have led
    to an increase in acres planted and a corresponding increase in
    potash imports. Last year, Brazil continued to be affected by
    the strengthening of the Brazilian real relative to the US
    dollar and lower commodity prices. In North America, sales
    volumes were up 37 percent as stronger dealer fill and
    field application of potash, due to high commodity prices and
    more acreage planted, led to high demand. In 2006, low crop
    commodity prices led to fewer corn acres planted and lower
    potash demand.  
    Offshore prices were up 15 percent as price increases in
    major markets were announced through the first half of 2007. In
    early February, Canpotex reached an agreement with Sinofert in
    China on a $5-per-tonne increase for shipments in 2007. Canpotex
    has announced and implemented price increases in Brazil that
    total $100 per tonne so far in 2007, with further $25-per-tonne
    and $50-per-tonne increases scheduled to take effect on October
    1 and December 1, respectively. In India, a $50-per-tonne
    price increase took effect on imports in the second quarter.
    Southeast Asian customers have seen a total of $95 per tonne in
    price increases so far in 2007, with further $30-per-tonne
    increases scheduled to take effect on October 1 and again in
    mid-October. Higher ocean freight rates had a negative impact of
    about $13 per tonne on all delivered-basis (CFR)
    sales, as Canpotex sells approximately 60 percent of its
    volumes on a CFR basis. However, Canpotex has locked in about
    40 percent of its CFR shipments under long-term freight
    agreements, which, compared to shipping entirely at spot rates,
    is expected to save it over $70 million in ocean freight
    costs in 2007. Prices in the North American market increased
    7 percent as an $11-per-tonne increase announced in the
    first quarter was fully realized in the second quarter and we
    began to capture a further $15-per-tonne increase that took
    effect June 1. Realized prices were negatively impacted in
    2006 by higher per-unit throughput distribution costs resulting
    from the reduced sales volumes.
    Higher production levels and fewer shutdown weeks significantly
    lowered cost of goods sold per tonne compared to the first nine
    months of 2006 when production shutdowns occurred as the company
    remained true to its strategy of matching production to market
    demand. The effect of increased production and lower natural gas
    costs was partially offset by escalating prices for supplies and
    services, higher brine inflow management costs and the impact of
    foreign exchange on potash operating costs. Brine inflow
    management costs at New Brunswick and Esterhazy incrementally
    increased costs by over $5 per tonne ($36.8 million) while
    a stronger Canadian dollar relative to the US dollar negatively
    impacted cost of goods sold by almost $2 per tonne. Since the
    costs of brine inflow were attributed to production of potash
    for which a greater proportion was sold in the offshore market,
    the price component of the cost of goods sold variance was
    higher for the offshore market than for North America. 37




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##### Table of Contents



Nitrogen
  Three Months Ended September 30Dollars (millions)


Tonnes (thousands)


Average Price per
    Tonne(1)2007


2006


% Change


2007


2006


% Change


2007


2006


% ChangeSales

$
436.0


$
292.6



49Freight


15.4



9.4



64Transportation and distribution


12.9



13.4



(4
)Net sales

$
407.7


$
269.8



51Manufactured productNet salesAmmonia

$
148.3


$
111.1



33



526



438



20


$
282.14


$
253.58



11Urea


119.1



70.8



68



356



290



23


$
334.39


$
244.35



37Nitrogen solutions/Nitric acid/Ammonium nitrate


105.1



75.1



40



569



503



13


$
184.79


$
149.41



24372.5



257.0



45



1,451



1,231



18


$
256.82


$
208.85



23Cost of goods sold


253.8



198.3



28














$
175.01


$
161.17



9Gross margin


118.7



58.7



102














$
81.81


$
47.68



72Other miscellaneous and purchased productNet sales


35.2



12.8



175Cost of goods sold


30.0



9.1



230Gross margin


5.2



3.7



41Gross margin

$
123.9


$
62.4



99














$
85.39


$
50.69



68   Nine Months Ended September 30Dollars (millions)


Tonnes (thousands)


Average Price per
    Tonne(1)2007


2006


% Change


2007


2006


% Change


2007


2006


% ChangeSales

$
1,336.8


$
966.9



38Freight


40.0



28.1



42Transportation and distribution


39.1



40.3



(3
)Net sales

$
1,257.7


$
898.5



40Manufactured productNet salesAmmonia

$
504.4


$
369.8



36



1,622



1,244



30


$
310.96


$
297.26



5Urea


344.9



239.7



44



1,008



899



12


$
342.36


$
266.58



28Nitrogen solutions/Nitric acid/Ammonium nitrate


323.9



240.0



35



1,693



1,354



25


$
191.28


$
177.31



81,173.2



849.5



38



4,323



3,497



24


$
271.40


$
242.94



12Cost of goods sold


789.0



625.2



26














$
182.53


$
178.80



2Gross margin


384.2



224.3



71














$
88.87


$
64.14



39Other miscellaneous and purchased productNet sales


84.5



49.0



72Cost of goods sold


69.3



39.8



74Gross margin


15.2



9.2



65Gross margin

$
399.4


$
233.5



71














$
92.39


$
66.77



38   (1)
    
    Rounding differences may occur due
    to the use of whole dollars in per-tonne calculations. 38




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##### Table of Contents



Highlights
  
    In Trinidad, where we have long-term, lower-cost natural gas
    price contracts, we generated $67.7 million in gross margin
    in the quarter. Our North American facilities continued to
    perform well, contributing $46.2 million, while our natural
    gas hedging program added $10.0 million. In the first nine
    months of the year our Trinidad operations delivered gross
    margin of $224.9 million, while we realized gains of
    $133.2 million from our US operations and
    $41.3 million from our natural gas hedges.
    Strong fundamentals in the fertilizer market led to realized
    price increases in all major nitrogen products quarter over
    quarter, and year over year with the exception of ammonium
    nitrate. Sales volumes increased with higher fertilizer demand,
    due to the fact that we had more product to sell than in the
    third quarter and first nine months of 2006. Fertilizer sales
    volumes increased 22 percent quarter over quarter and
    38 percent year over year.
    Transportation and distribution costs declined despite the
    increase in sales and sales volumes for the three and nine
    months ended September 30, 2007 compared to the same
    periods in 2006. A change in sales volumes with certain
    customers occurred whereby fewer transportation and storage
    requirements existed. North American sales volumes (which
    attract less transportation and distribution costs, though incur
    higher freight) increased, particularly in the third quarter.
    Freight increases were consistent with higher sales, including
    higher North American sales during 2007.
    Cost of goods sold was negatively impacted by natural gas costs
    that, including our hedge, were 13 percent higher than the
    third quarter of last year and up 9 percent compared to the
    first nine months of 2006. Our hedge gains were
    $5.7 million and $14.5 million lower than the third
    quarter and first nine months of 2006, respectively.  Manufactured
    nitrogen gross margin variance attributable to:
  Three Months Ended September 30



Nine Months Ended September 30Dollars (millions)

2007 vs. 2006



2007 vs. 2006Change in











Change inPrices/Costs











Prices/CostsChange in







Total Gross



Change in







Total GrossSales






Cost of



Margin



Sales






Cost of



MarginVolumes



Net Sales


Goods Sold



Variance



Volumes



Net Sales


Goods Sold



VarianceManufactured productAmmonia

$
5.2



$
14.9


$
(1.6
)


$
18.5



$
48.6



$
22.4


$
(0.9
)


$
70.1Urea


6.9




32.1



(9.9
)



29.1




8.7




76.4



(8.6
)



76.5Solutions, NA, AN


2.8




20.1



(4.9
)



18.0




11.9




23.6



(8.5
)



27.0Hedge


-




-



(5.7
)



(5.7
)



-




-



(14.5
)



(14.5
)Change in product mix


(2.7
)



2.4



0.4




0.1




(0.3
)



0.6



0.5




0.8Total

$
12.2



$
69.5


$
(21.7
)


$
60.0



$
68.9



$
123.0


$
(32.0
)


$
159.9   Sales and
    Cost of Goods Sold
    
    Realized prices for ammonia and urea were up 11 percent and
    37 percent, respectively, due to tight supply/demand
    fundamentals, while prices for nitrogen solutions jumped
    51 percent and added $16.1 million to the change in
    gross margin. Increased corn acreage and product characteristics
    that make solutions an increasingly preferred nitrogen source
    led to the heightened prices. Although nitrogen prices have
    historically decreased after the second quarter because of a
    seasonal decline in natural gas costs and sales volumes, strong
    demand limited the price decline from this years second
    quarter to 9 percent overall despite our 17 percent
    increase in US natural gas spot market prices during the quarter.
    Total nitrogen volumes rose 18 percent, with fertilizer
    shipments increasing by 22 percent and industrial volumes
    up 16 percent. Ammonia sales volumes rose 20 percent
    as we had greater production available this 39




---



##### Table of Contents



year from our Lima facility (due to 38 more production days) and
    the 2006 debottlenecking projects in Trinidad. Urea volumes were
    up 23 percent in large part because Lima operated for the entire
    quarter. Nitrogen solutions were up 32 percent due to
    opportunistic production of UAN at Geismar.  
    Cost of goods sold increased 9 percent per tonne, primarily
    as a result of higher natural gas cost during the quarter. Our
    total average natural gas cost for the quarter, which includes
    the benefit of our hedge and our lower-cost Trinidad gas
    contracts, was $3.94 per MMBtu, 13 percent higher than the same
    quarter last year but 11 percent lower than in the second
    quarter. This was partially offset by reduced costs and volumes
    of ammonia purchased for internal consumption in the production
    of downstream products, which was higher in 2006 while certain
    of the companys operations were not producing. The price
    component of the cost of goods sold variance was higher in urea
    than in ammonia, partly due to higher depreciation rates that
    increased the cost of the ammonia used in downstream product
    consumption. Our US natural gas hedging activities contributed
    $10.0 million to gross margin, compared to
    $15.7 million last year.    
    Realized prices for urea were up 28 percent on strong
    agricultural demand, supplemented by production disruptions in
    the Middle East and new capacity delays early in 2007. Realized
    prices for ammonia increased only 5 percent despite
    quarter-over-quarter
    increases of 5 percent and 11 percent in the second
    and third quarters, respectively, as realized prices declined
    4 percent in the first quarter compared to last years
    first quarter when high natural gas costs from the aftermath of
    Hurricane Katrina drove prices. Tight fundamentals that pushed
    ammonia prices up and led to a decoupling of ammonia from
    natural gas cost early in 2007 continued, driven by strong North
    American agricultural demand and low product inventories. Prices
    were sustained through the third quarter. The significant price
    increase seen in nitrogen solutions during the second and third
    quarters of 2007 positively impacted gross margin for the first
    nine months, contributing $42.4 million to the increase.
    These price increases were partially offset by a 14-percent
    decline in per-tonne realized price for ammonium nitrate prills
    because our primary customer contracts are impacted by the
    natural gas prices on a time-lag basis, negatively impacting
    gross margin by $17.0 million.
    Ammonia sales volumes were up 30 percent as we benefited
    from the strong overall demand for nitrogen and the additional
    tonnes available from the final stage of our Trinidad
    debottlenecking projects and from having 119 fewer shutdown days
    at our Lima plant. This compared to the first nine months of
    2006 when we experienced scheduled plant turnarounds related to
    debottlenecking projects at our 01 and 02 plants in Trinidad and
    mechanical problems at our Lima facility (limiting its
    production in both the second and third quarters of 2006). Urea
    sales volumes also increased, due in large part to significant
    demand for field application. Fertilizer sales tonnes were up
    38 percent from the first nine months of 2006 on strong
    demand, as compared to last year when US farmers were purchasing
    less as we believe they were hoping for lower prices. Total
    industrial demand remained strong, rising 17 percent from
    the same period last year and representing 64 percent of
    nitrogen sales volumes.
    Cost of goods sold increased, negatively impacting gross margin.
    Our average natural gas cost was $4.26 per MMBtu, 9 percent
    higher than the first nine months of 2006. The price component
    of the cost of goods sold variance was higher in other products
    than in ammonia; in urea this was partly due to higher
    depreciation rates that increased the cost of the ammonia used
    in downstream urea production. Overall, costs associated with
    production
    start-ups
    last year after completion of the debottlenecking projects in
    Trinidad and mechanical problems at our Lima facility raised
    costs for ammonia that were not incurred this year. Our US
    natural gas hedging activities contributed $41.3 million to
    gross margin, compared to $55.8 million last year. The
    negative impacts of slightly higher natural gas costs and lower
    gain from our natural gas hedges were partially offset by the
    efficiencies arising from higher production rates as compared to
    the first nine months of 2006. 40




---



##### Table of Contents



Phosphate
  Three Months Ended September 30Dollars (millions)


Tonnes (thousands)


Average Price per
    Tonne(1)2007


2006


% Change


2007


2006


% Change


2007


2006


% ChangeSales

$
431.6


$
326.6



32Freight


26.9



22.6



19Transportation and distribution


9.4



13.7



(31
)Net sales

$
395.3


$
290.3



36Manufactured productNet salesFertilizer  liquids

$
79.2


$
52.5



51



252



232



9


$
315.35


$
226.34



39Fertilizer  solids


167.0



101.2



65



416



428



(3
)

$
400.78


$
235.90



70Feed


65.1



66.5



(2
)


185



222



(17
)

$
351.40


$
298.99



18Industrial


71.4



58.2



23



183



156



17


$
391.78


$
374.46



5382.7



278.4



37



1,036



1,038



-


$
369.63


$
268.02



38Cost of goods sold


255.6



250.6



2














$
246.95


$
241.24



2Gross margin


127.1



27.8



357














$
122.68


$
26.78



358Other miscellaneous and purchased productNet sales


12.6



11.9



6Cost of goods sold


9.8



9.9



(1
)Gross margin


2.8



2.0



40Gross margin

$
129.9


$
29.8



336














$
125.39


$
28.71



337   Nine Months Ended September 30Dollars (millions)


Tonnes (thousands)


Average Price per
    Tonne(1)2007


2006


% Change


2007


2006


% Change


2007


2006


% ChangeSales

$
1,147.9


$
920.4



25Freight


79.8



63.3



26Transportation and distribution


24.6



35.4



(31
)Net sales

$
1,043.5


$
821.7



27Manufactured productNet salesFertilizer  liquids

$
189.0


$
139.0



36



687



620



11


$
275.28


$
224.27



23Fertilizer  solids


424.5



288.1



47



1,193



1,190



-


$
355.80


$
242.03



47Feed


191.2



178.4



7



596



583



2


$
320.48


$
306.27



5Industrial


203.3



180.1



13



541



485



12


$
375.98


$
371.30



11,008.0



785.6



28



3,017



2,878



5


$
334.11


$
272.99



22Cost of goods sold


725.3



698.8



4














$
240.41


$
242.83



(1
)Gross margin


282.7



86.8



226














$
93.70


$
30.16



211Other miscellaneous and purchased productNet sales


35.5



36.1



(2
)Cost of goods sold


27.3



30.9



(12
)Gross margin


8.2



5.2



58Gross margin

$
290.9


$
92.0



216














$
96.42


$
31.97



202   (1)
    
    Rounding differences may occur due
    to the use of whole dollars in per-tonne calculations. 41




---



##### Table of Contents



Highlights
  
    While strategic focus on our unique ability to produce and
    market specialty phosphate products has brought both stability
    and increased profitability to the phosphate segment over recent
    years, strengthening global agricultural fundamentals has
    started to demonstrate the value of our leverage in liquid and
    solid phosphate fertilizers. Phosphate gross margin of
    $129.9 million was a record for the quarter and raised our
    phosphate gross margin to $290.9 million for the first nine
    months of 2007.
    Solid fertilizers generated $65.1 million in gross margin
    during the quarter, while liquid fertilizers added
    $28.5 million, industrial products $15.7 million and
    feed $17.8 million.
    Transportation and distribution costs declined 31 percent
    in the third quarter and first nine months of 2007 despite the
    increase in sales revenues, as offshore sales volumes of solid
    fertilizers and feed products declined as the company focused on
    the North American market.  Manufactured
    phosphate gross margin variance attributable to:
  Three Months Ended September 30



Nine Months Ended September 30Dollars (millions)

2007 vs. 2006



2007 vs. 2006Change in











Change inChange in







Total Gross



Change in







Total GrossSales






Cost of



Margin



Sales






Cost of



MarginVolumes



Net Sales


Goods Sold



Variance



Volumes



Net Sales


Goods Sold



VarianceManufactured productLiquid Fertilizer

$
2.7



$
22.4


$
2.4



$
27.5



$
13.0



$
33.4


$
(1.8
)


$
44.6Solid Fertilizer


(1.2
)



68.5



(4.1
)



63.2




0.6




135.6



6.7




142.9Feed


(6.6
)



9.7



-




3.1




3.7




8.5



(9.9
)



2.3Industrial


6.6




3.2



(4.4
)



5.4




18.3




2.5



(16.0
)



4.8Change in product mix


(2.0
)



1.4



0.7




0.1




(3.6
)



4.3



0.6




1.3Total

$
(0.5
)


$
105.2


$
(5.4
)


$
99.3



$
32.0



$
184.3


$
(20.4
)


$
195.9   Sales and
    Cost of Goods Sold
  Quarter-over-quarter
  
    High commodity prices have led to high global demand for
    fertilizer products and have driven realized prices up,
    including prices for solid fertilizers which rose by
    70 percent. Many producers allocated more of their
    phosphoric acid to solid fertilizer production, tightening
    supply of other phosphate products. Liquid fertilizer realized
    prices were up 39 percent. Additionally, netbacks on feed
    phosphate increased by 18 percent as we focused on more
    profitable North American markets, with monocal and dical rising
    by more than $50 per tonne and DFP, a poultry feed supplement,
    by $20 per tonne. Industrial product pricing, which is generally
    set under longer-term contracts, rose 5 percent.
    Our focus in solid fertilizers shifted towards the North
    American market where agricultural demand was high; as a result,
    North American solid fertilizer volumes increased
    38 percent, while offshore volumes fell 32 percent.
    Despite the increased market demand for fertilizer products,
    solid fertilizer sales volumes declined overall as we sold fewer
    tonnes of solid fertilizers in order to deliver on liquid
    phosphate demand. Liquid fertilizer sales volumes remained
    strong and were up 9 percent. Feed volumes declined
    17 percent as we sold considerably less into lower-margin
    offshore markets, while industrial sales tonnes increased
    17 percent, due primarily to the availability of more
    tonnes from our new purified acid plant at Aurora.
    Rising costs for sulfur and phosphate rock negatively impacted
    phosphate gross margin in the quarter. Phosphate rock costs
    increased 3 percent largely due to higher costs for purchased
    rock at Geismar. Reduced oil refinery production and high demand
    from the phosphate industry tightened global sulfur supply and
    raised these costs by 8 percent compared to last years
    third quarter and 29 percent from the trailing quarter,
    negatively impacting the change in gross margin compared to last
    year by $3.2 million. Further, 6-percent higher ammonia
    prices negatively impacted gross margin for solid fertilizer
    products by $1.8 million. These higher prices were
    partially offset as in third-quarter 2006, the company
    indefinitely 42




---



##### Table of Contents



suspended production of Super Phosphoric Acid and Poly-N
    phosphate products at its Geismar, Louisiana facilities, at
    which time an impairment loss of $6.3 million was
    recognized within the liquid fertilizer component.  year-over-year
  
    Strong agricultural demand for fertilizer products pushed up
    realized prices for solid and liquid fertilizers by 47 and
    23 percent, respectively. Solid fertilizer sales volumes
    were flat overall as we sold fewer tonnes of solid fertilizers
    in order to deliver on liquid phosphate demand. Our liquid
    phosphate fertilizer capability allowed us to capitalize on
    significantly higher US demand, selling 18 percent more
    there than in the same period last year. Total liquid fertilizer
    sales volumes increased 11 percent. Industrial sales
    volumes were 12 percent higher due to increased production
    at our newest Aurora purified acid plant. Feed sales volumes
    increased during the first half of 2007 with an increase in
    offshore sales, primarily due to new business in Latin America
    in the first quarter of 2007, and on stronger North American
    demand in the second quarter; however, feed sales declined in
    the third quarter and ended the first nine months of 2007 up
    only 2 percent.
    The price variance in cost of goods sold had a $20.4-million
    unfavorable impact on the change in gross margin. The
    $12.4-million positive impact of 10-percent lower sulfur prices
    was more than offset by higher costs. Ammonia costs, which were
    4 percent higher, decreased gross margin by
    $3.6 million while 3-percent higher rock costs resulting
    from higher costs for purchased rock at Geismar, higher
    electrical and chemical processing costs at Aurora and White
    Springs and two planned dragline turnarounds at Aurora increased
    costs further. The cost of goods sold price variance for solid
    fertilizer products is positive despite these higher costs due
    in part to a change in product mix within the solid fertilizer
    category as we produced less DAP and more MAP, thereby consuming
    less ammonia which is required in the production of DAP.
    Further, in the second quarter of 2006 the company had
    production inefficiencies at one of its plants after the
    conversion of the plant to a different phosphoric acid
    production technology, while the plant ran efficiently in the
    first nine months of 2007. The price variance in cost of goods
    sold for industrial products is higher than for other products,
    due to a mechanical difficulty encountered in a plant that
    produces industrial product.  Expenses
    and Other Income
  Three Months Ended


Nine Months EndedSeptember 30


September 30Dollar


%








Dollar


%Dollars (millions)

2007


2006


Change


Change


2007


2006


Change


ChangeSelling and administrative

$
43.9


$
35.9


$
8.0



22


$
158.0


$
114.6


$
43.4



38Provincial mining and other taxes


28.2



12.5



15.7



126



95.3



41.2



54.1



131Foreign exchange loss (gain)


25.9



(4.7
)


30.6



651



67.4



9.2



58.2



633Other income


29.1



21.1



8.0



38



111.3



72.3



39.0



54Interest expense


12.7



25.2



(12.5
)


(50
)


59.0



69.1



(10.1
)


(15
)Income taxes


150.4



52.8



97.6



185



351.0



95.1



255.9



269      43




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##### Table of Contents



51-percent
        Three Months Ended


Nine Months EndedSeptember 30


September 30%











%Dollars millions  except percentage amounts

2007


2006


Change


Change


2007


2006


Change


ChangeLong-term debt obligations, including current portionWeighted average outstanding

$
1,423.8


$
1,258.1


$
165.7



13


$
1,617.3


$
1,258.4


$
358.9



29Weighted average interest rate


6.5%



7.0%



(0.5%
)


(7
)


6.6%



7.0%



(0.4%
)


(6
)Short-term debtWeighted average outstanding

$
87.5


$
612.6


$
(525.1
)


(86
)

$
97.2


$
548.6


$
(451.4
)


(82
)Weighted average interest rate


5.5%



5.5%



0.0%



-



5.5%



5.1%



0.4%



8    44




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##### Table of Contents




    A scheduled 2-percentage point reduction in the Canadian federal
    income tax rate applicable to resource companies, effective at
    the beginning of 2007, was more than offset by a higher
    percentage of consolidated income earned in higher-tax
    jurisdictions, during the three and nine months ended
    September 30, 2007 compared to the same periods in 2006. As
    a result of the increasing proportion of consolidated income
    earned in higher-tax jurisdictions, during the third quarter of
    2007 it was determined that the consolidated effective rate for
    the year had increased from 30 percent to 33 percent.
    The reported income tax rate for the third quarter of 2007 is
    higher than the effective rate as the impact of this retroactive
    change on prior periods, as applicable, was reflected during the
    quarter.
    During the second quarter of 2007, the Government of Canada
    enacted a reduction of the federal corporate income tax rate to
    18.5 percent by 2011. This reduction was in addition to
    changes enacted by the Government of Canada in the second
    quarter of 2006 to reduce the federal corporate income tax rate
    from 23 percent in 2006 to 19 percent by 2010 and
    reduce the federal corporate surtax from 1.12 percent to
    nil in 2008. These changes reduced the companys future
    income tax liability by $4.7 million in the second quarter
    of 2007 and $22.9 million in the second quarter of 2006.
    In addition to the federal changes noted above, the Province of
    Saskatchewan enacted changes to the corporate income tax during
    the quarter ended June 30, 2006, reducing the rate from
    17 percent to 12 percent by 2009. These changes resulted in
    a $21.9 million reduction in the companys future
    income tax liability in the second quarter of 2006.
    Income tax refunds totaling $22.4 million for the 1999 and
    2001-2004 taxation years were recorded during the nine months
    ended September 30, 2006, $6.6 million of which was
    recognized during the third quarter of 2006. The refunds related
    to a Canadian appeal court decision (pertaining to a uranium
    producer) which affirmed the deductibility of the Saskatchewan
    capital tax resource surcharge.   45




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##### Table of Contents



LIQUIDITY
    AND CAPITAL RESOURCES
  Cash
    Requirements
    Contractual
    Obligations and Other Commitments
  Payments Due By PeriodDollars (millions)Total


Within 1 year


1 to 3 years


3 to 5 years


Over 5 yearsLong-term debt obligations

$
1,357.1


$
0.2


$
0.6


$
606.3


$
750.0Estimated interest payments on long-term debt obligations


1,172.4



96.8



193.6



146.5



735.5Operating leases


638.6



91.1



163.4



130.7



253.4Purchase obligations


799.6



142.1



210.9



157.3



289.3Other commitments


81.4



24.5



29.2



7.5



20.2Other long-term liabilities


1,327.0



80.3



88.2



36.1



1,122.4Total

$
5,376.1


$
435.0


$
685.9


$
1,084.4


$
3,170.8   Long-term
    Debt
  back-to-back
      Operating
    Leases
     46




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##### Table of Contents



Purchase
    Obligations
        Other
    Commitments
    Other
    Long-term Liabilities
      Capital
    Expenditures
         47




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##### Table of Contents



Short-term
    Investment Liquidity
  Other
    Short-term Investments
      Sources
    and Uses of Cash
    Three Months Ended


Nine Months EndedSeptember 30


September 30$


%








$


%Dollars (millions)

2007


2006


Change


Change


2007


2006


Change


ChangeCash provided by operating activities

$
311.6


$
224.9


$
86.7



39


$
1,157.3


$
353.6


$
803.7



227Cash used in investing activities


(296.6
)


(126.7
)


(169.9
)


134



(530.8
)


(502.6
)


(28.2
)


6Cash (used in) provided by financing activities


(22.2
)


(36.5
)


14.3



(39
)


(509.7
)


246.5



(756.2
)


(307
)     September 30,


December 31,


$


%Dollars (millions) except ratio amounts

2007


2006


Change


ChangeCurrent assets

$
1,650.9


$
1,310.2


$
340.7



26Current liabilities

$
(773.4
)

$
(1,103.5
)

$
330.1



(30
)Working capital

$
877.5


$
206.7


$
670.8



325Current ratio


2.13



1.19



0.94



79      48




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##### Table of Contents




    During the first quarter of 2007, $9.7 million was paid to
    settle outstanding amounts related to the December 2006 purchase
    of additional shares in SQM. During the third quarter of 2007,
    the company purchased an additional 1,011,062 shares of SQM
    for cash consideration of $16.8 million. The companys
    ownership interest in SQM remains at approximately
    32 percent. During the first quarter of 2006, the company
    acquired an additional 10-percent interest in the ordinary
    shares of Sinofert for cash consideration of
    $126.3 million, which was financed by short-term debt.
    Our spending on property, plant and equipment was
    $145.1 million in third-quarter 2007, an increase of
    $11.3 million over the third quarter of 2006, and
    $381.6 million in the first nine months, a decrease of
    $3.3 million compared to the same period in 2006.
    Approximately 64 percent (2006  76 percent)
    of our consolidated capital expenditures for the third quarter
    related to the potash segment and 59 percent
    (2006  61 percent) related to the potash segment in
    the first nine months of 2007.
    The company invested $132.5 million in other short-term
    investments in the form of auction rate securities during the
    third quarter of 2007.  10-year
 49




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##### Table of Contents



Principal
    Debt Instruments
  September 30, 2007Total


Amount


Amount


AmountDollars (millions)

Amount


Outstanding


Committed


AvailableSyndicated credit facility

$
750.0


$
-


$
92.1


$
657.9Line of credit


75.0



-



19.7



55.3Commercial paper


750.0



92.1



-



657.9US shelf registrations


2,000.0



1,350.0



-



250.0
(1)   (1)
    
    $400.0 million of senior notes
    issued under one of the companys US shelf registration
    statements repaid in full at maturity; no additional amount is
    available in respect of the principal of these senior notes.  debt-to-capital debt-to-EBITDA
        Outstanding
    Share Data
   50




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##### Table of Contents



Off-Balance
    Sheet Arrangements
    Guarantee
    Contracts
    back-to-back
         51




---



##### Table of Contents



Derivative
    Instruments
  marked-to-market marked-to-market
  Long-term
    Fixed Price Contracts
    QUARTERLY
    FINANCIAL HIGHLIGHTS
  Dollars (millions)

September 30,


June 30,


March 31,



December 31,


September 30,


June 30,


March 31,



December 31,except per-share amounts

2007


2007


2007



2006


2006


2006


2006



2005Sales

$
1,295.0


$
1,353.1


$
1,154.7



$
1,022.9


$
953.5


$
928.7


$
861.6



$
930.5Gross margin


475.1



501.4



369.7




299.3



245.8



253.4



203.5




242.2Net income


243.1



285.7



198.0




186.0



145.2



175.1



125.5




117.1Net income per share  basic


0.77



0.91



0.63




0.59



0.47



0.56



0.40




0.37Net income per share  diluted


0.75



0.88



0.62




0.58



0.46



0.55



0.40




0.36       RELATED
    PARTY TRANSACTIONS
    CRITICAL
    ACCOUNTING ESTIMATES
  Form 10-Q.
   52




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##### Table of Contents



RECENT
    ACCOUNTING CHANGES
  Changes
    in Accounting Policies
  Canada
  Comprehensive
    Income, Equity, Financial Instruments and Hedges  Form 10-Q.
  Accounting
    Changes    Stripping
    Costs Incurred in the Production Phase of a Mining
    Operation  EIC-160,
  United
    States
  Uncertainty
    in Income Taxes  Form 10-Q.
 53




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##### Table of Contents



Recent
    Accounting Pronouncements
  Canada
  Variable
    Interest Entities  Clarification    Capital
    Disclosures    Financial
    Instruments  Form 10-Q.
    Inventories    International
    Financial Reporting Standards   54




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##### Table of Contents



United
    States
  Variable
    Interest Entities  Clarification
    Planned
    Major Maintenance Activities
  accrue-in-advance
  Fair
    Value Measurement
    Fair
    Value Option for Financial Assets and Financial Liabilities
    RISK
    MANAGEMENT
    integrity/empowerment.
     55




---



##### Table of Contents



2.0-million-tonne-per-year
  OUTLOOK
        year-to-date
   56




---



##### Table of Contents



6-kilometer
             57




---



##### Table of Contents



FORWARD
    LOOKING STATEMENTS
  Form 10-Q,
 
  ITEM
    3.
    QUANTITATIVE
    AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK  Form 10-Q
  Commodity
    Risk
       58




---



##### Table of Contents



Interest
    Rate Risk
        Foreign
    Exchange Risk
     
  ITEM
    4.
    CONTROLS
    AND PROCEDURES     59




---



##### Table of Contents



PART II.  OTHER
    INFORMATION
 
  ITEM
    6.  EXHIBITS
  (a)
    EXHIBITS  ExhibitNumber

Description of
    Document3
(a)

Articles of Continuance of the registrant dated May 15,
    2002, incorporated by reference to Exhibit 3(a) to the
    registrants report on
    Form 10-Q
    for the quarterly period ended June 30, 2002 (the
    Second Quarter 2002
    Form 10-Q).3
(b)

Bylaws of the registrant effective May 15, 2002,
    incorporated by reference to Exhibit 3(b) to the Second
    Quarter 2002
    Form 10-Q.4
(a)

Term Credit Agreement between The Bank of Nova Scotia and other
    financial institutions and the registrant dated
    September 25, 2001, incorporated by reference to
    Exhibit 4(a) to the registrants report on
    Form 10-Q
    for the quarterly period ended September 30, 2001.4
(b)

Syndicated Term Credit Facility Amending Agreement between The
    Bank of Nova Scotia and other financial institutions and the
    registrant dated as of September 23, 2003, incorporated by
    reference to Exhibit 4(b) to the registrants report
    on
    Form 10-Q
    for the quarterly period ended September 30, 2003 (the
    Third Quarter 2003
    Form 10-Q).4
(c)

Syndicated Term Credit Facility Second Amending Agreement
    between The Bank of Nova Scotia and other financial institutions
    and the registrant dated as of September 21, 2004,
    incorporated by reference to Exhibit 4(c) to the
    registrants report on
    Form 8-K
    dated September 21, 2004.4
(d)

Syndicated Term Credit Facility Third Amending Agreement between
    The Bank of Nova Scotia and other financial institutions and the
    registrant dated as of September 20, 2005, incorporated by
    reference to Exhibit 4(a) to the registrants report
    on
    Form 8-K
    dated September 22, 2005.4
(e)

Syndicated Term Credit Facility Fourth Amending Agreement
    between The Bank of Nova Scotia and other financial institutions
    and the registrant dated as of September 27, 2006,
    incorporated by reference to Exhibit 4(e) to the
    registrants report on
    Form 10-Q
    for the quarterly period ended September 30, 2006.4
(f)

Syndicated Term Credit Facility Fifth Amending Agreement between
    The Bank of Nova Scotia and other financial institutions and the
    registrant dated as of October 19, 2007, incorporated by
    reference to Exhibit 4(a) to the registrants report
    on
    Form 8-K
    dated October 22, 2007.4
(g)

Indenture dated as of June 16, 1997, between the registrant
    and The Bank of Nova Scotia Trust Company of New York,
    incorporated by reference to Exhibit 4(a) to the
    registrants report on
    Form 8-K
    dated June 18, 1997 (the 1997
    Form 8-K).4
(h)

Indenture dated as of February 27, 2003, between the
    registrant and The Bank of Nova Scotia Trust Company of New
    York, incorporated by reference to Exhibit 4(c) to the
    registrants report on
    Form 10-K
    for the year ended December 31, 2002 (the 2002
    Form 10-K).4
(i)

Form of Note relating to the registrants offering of
    $600,000,000 principal amount of 7.75% Notes due May 31,
    2011, incorporated by reference to Exhibit 4 to the
    registrants report on
    Form 8-K
    dated May 17, 2001.4
(j)

Form of Note relating to the registrants offering of
    $250,000,000 principal amount of 4.875% Notes due March 1,
    2013, incorporated by reference to Exhibit 4 to the
    registrants report on
    Form 8-K
    dated February 28, 2003.4
(k)

Form of Note relating to the registrants offering of
    $500,000,000 principal amount of 5.875% Notes due
    December 1, 2036, incorporated by reference to
    Exhibit 4(a) to the registrants report on
    Form 8-K
    dated November 29, 2006.    60




---



##### Table of Contents



ExhibitNumber

Description of
    Document10
(a)

Sixth Voting Agreement dated April 22, 1978, between
    Central Canada Potash, Division of Noranda, Inc., Cominco Ltd.,
    International Minerals and Chemical Corporation (Canada)
    Limited, PCS Sales and Texasgulf Inc., incorporated by reference
    to Exhibit 10(f) to the registrants registration
    statement on
    Form F-1
    (File
    No. 33-31303)
    (the F-1 Registration Statement).10
(b)

Canpotex Limited Shareholders Seventh Memorandum of Agreement
    effective April 21, 1978, between Central Canada Potash,
    Division of Noranda Inc., Cominco Ltd., International Minerals
    and Chemical Corporation (Canada) Limited, PCS Sales, Texasgulf
    Inc. and Canpotex Limited as amended by Canpotex S&P
    amending agreement dated November 4, 1987, incorporated by
    reference to Exhibit 10(g) to the F-1 Registration
    Statement.10
(c)

Producer Agreement dated April 21, 1978, between Canpotex
    Limited and PCS Sales, incorporated by reference to
    Exhibit 10(h) to the F-1 Registration Statement.10
(d)

Canpotex/PCS Amending Agreement, dated as of October 1,
    1992, incorporated by reference to Exhibit 10(f) to the
    registrants report on
    Form 10-K
    for the year ended December 31, 1995 (the 1995
    Form 10-K).10
(e)

Canpotex PCA Collateral Withdrawing/PCS Amending Agreement,
    dated as of October 7, 1993, incorporated by reference to
    Exhibit 10(g) to the 1995
    Form 10-K.10
(f)

Canpotex Producer Agreement amending agreement dated as of
    January 1, 1999, incorporated by reference to
    Exhibit 10(f) to the registrants report on
    Form 10-K
    for the year ended December 31, 2000 (the 2000
    Form 10-K).10
(g)

Canpotex Producer Agreement amending agreement dated as of
    July 1, 2002, incorporated by reference to
    Exhibit 10(g) to the registrants report on
    Form 10-Q
    for the quarterly period ended June 30, 2004 (the
    Second Quarter 2004
    Form 10-Q).10
(h)

Esterhazy Restated Mining and Processing Agreement dated
    January 31, 1978, between International
    Minerals & Chemical Corporation (Canada) Limited and
    the registrants predecessor, incorporated by reference to
    Exhibit 10(e) to the F-1 Registration Statement.10
(i)

Agreement dated December 21, 1990, between International
    Minerals & Chemical Corporation (Canada) Limited and
    the registrant, amending the Esterhazy Restated Mining and
    Processing Agreement dated January 31, 1978, incorporated
    by reference to Exhibit 10(p) to the registrants
    report on
    Form 10-K
    for the year ended December 31, 1990.10
(j)

Agreement effective August 27, 1998, between International
    Minerals & Chemical (Canada) Global Limited and the
    registrant, amending the Esterhazy Restated Mining and
    Processing Agreement dated January 31, 1978 (as amended),
    incorporated by reference to Exhibit 10(l) to the 1998
    Form 10-K.10
(k)

Agreement effective August 31, 1998, among International
    Minerals & Chemical (Canada) Global Limited,
    International Minerals & Chemical (Canada) Limited
    Partnership and the registrant assigning the interest in the
    Esterhazy Restated Mining and Processing Agreement dated
    January 31, 1978 (as amended) held by International
    Minerals & Chemical (Canada) Global Limited to
    International Minerals & Chemical (Canada) Limited
    Partnership, incorporated by reference to Exhibit 10(m) to
    the 1998
    Form 10-K.10
(l)

Potash Corporation of Saskatchewan Inc. Stock Option
    Plan  Directors, as amended, incorporated by
    reference to Exhibit 10(l) to the registrants report
    on
    Form 10-K
    for the year ended December 31, 2006 (the 2006
    Form 10-K).10
(m)

Potash Corporation of Saskatchewan Inc. Stock Option
    Plan  Officers and Employees, as amended,
    incorporated by reference to Exhibit 10(m) to the 2006
    Form 10-K.10
(n)

Short-Term Incentive Plan of the registrant effective January
    2000, as amended, incorporated by reference to
    Exhibit 10(n) to the registrants report on
    Form 10-Q
    for the quarterly period ended June 30, 2007.10
(o)

Resolution and Forms of Agreement for Supplemental Retirement
    Income Plan, for officers and key employees of the registrant,
    incorporated by reference to Exhibit 10(o) to the 1995
    Form 10-K. 61




---



##### Table of Contents



ExhibitNumber

Description of
    Document10
(p)

Amending Resolution and revised forms of agreement regarding
    Supplemental Retirement Income Plan of the registrant,
    incorporated by reference to Exhibit 10(x) to the
    registrants report on
    Form 10-Q
    for the quarterly period ended June 30, 1996.10
(q)

Amended and restated Supplemental Retirement Income Plan of the
    registrant and text of amendment to existing supplemental income
    plan agreements, incorporated by reference to
    Exhibit 10(mm) to the registrants report on
    Form 10-Q
    for the quarterly period ended September 30, 2000 (the
    Third Quarter 2000
    Form 10-Q).10
(r)

Form of Letter of amendment to existing supplemental income plan
    agreements of the registrant dated November 4, 2002,
    incorporated by reference to Exhibit 10(cc) to the 2002
    Form 10-K.10
(s)

Amended and restated agreement dated February 20, 2007,
    between the registrant and William J. Doyle concerning the
    Supplemental Retirement Income Plan, incorporated by reference
    to Exhibit 10(s) to the 2006
    Form 10-K.10
(t)

Supplemental Retirement Benefits Plan for U.S. Executives dated
    effective January 1, 1999, incorporated by reference to
    Exhibit 10(aa) to the Second Quarter 2002
    Form 10-Q.10
(u)

Forms of Agreement dated December 30, 1994, between the
    registrant and certain officers of the registrant, concerning a
    change in control of the registrant, incorporated by reference
    to Exhibit 10(p) to the 1995
    Form 10-K.10
(v)

Form of Agreement of Indemnification dated August 8, 1995,
    between the registrant and certain officers and directors of the
    registrant, incorporated by reference to Exhibit 10(q) to
    the 1995
    Form 10-K.10
(w)

Resolution and Form of Agreement of Indemnification dated
    January 24, 2001, incorporated by reference to
    Exhibit 10(ii) to the 2000
    Form 10-K.10
(x)

Resolution and Form of Agreement of Indemnification 
    July 21, 2004, incorporated by reference to
    Exhibit 10(ii) to the Second Quarter 2004
    Form 10-Q.10
(y)

Chief Executive Officer Medical and Dental Benefits,
    incorporated by reference to Exhibit 10(jj) to the
    Form 10-K
    for the year ended December 31, 2004.10
(z)

Second Amended and Restated Membership Agreement dated
    January 1, 1995, among Phosphate Chemicals Export
    Association, Inc. and members of such association, including
    Texasgulf Inc., incorporated by reference to Exhibit 10(t)
    to the 1995
    Form 10-K.10
(aa)

International Agency Agreement dated effective December 15,
    2006, between Phosphate Chemicals Export Association, Inc. and
    PCS Sales (USA), Inc., incorporated by reference to
    Exhibit 10(aa) to the 2006
    Form 10-K.10
(bb)

Deferred Share Unit Plan for Non-Employee Directors,
    incorporated by reference to Exhibit 4.1 to the
    registrants
    Form S-8
    (File
    No. 333-75742)
    filed December 21, 2001.10
(cc)

Potash Corporation of Saskatchewan Inc. 2005 Performance Option
    Plan and Form of Option Agreement, as amended, incorporated by
    reference to Exhibit 10(cc) to the 2006
    Form 10-K.10
(dd)

Potash Corporation of Saskatchewan Inc. 2006 Performance Option
    Plan and Form of Option Agreement, as amended, incorporated by
    reference to Exhibit 10(dd) to the 2006
    Form 10-K.10
(ee)

Potash Corporation of Saskatchewan Inc. 2007 Performance Option
    Plan and Form of Option Agreement, incorporated by reference to
    Exhibit 10(ee) to the registrants report on
    Form 10-Q
    for the quarterly period ended March 31, 2007.10
(ff)

Medium Term Incentive Plan of the registrant effective January
    2006, incorporated by reference to Exhibit 10(dd) to the
    registrants report on
    Form 10-K
    for the year ended December 31, 2005.11


Statement re Computation of Per Share Earnings.31
(a)

Certification pursuant to Section 302 of the
    Sarbanes-Oxley Act of 2002.31
(b)

Certification pursuant to Section 302 of the
    Sarbanes-Oxley Act of 2002.32


Certification pursuant to Section 906 of the
    Sarbanes-Oxley Act of 2002.  62




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##### Table of Contents



SIGNATURES
         By:
    /s/  Joseph
    Podwika   Senior Vice President, General Counsel and Secretary
    By:
    /s/  Wayne
    R. Brownlee   Executive Vice President, Treasurer and
 Chief Financial Officer
 (Principal Financial and Accounting Officer)
 63




---



##### Table of Contents



EXHIBIT
    INDEX
  ExhibitNumber

Description of
    Document3
(a)

Articles of Continuance of the registrant dated May 15,
    2002, incorporated by reference to Exhibit 3(a) to the
    registrants report on
    Form 10-Q
    for the quarterly period ended June 30, 2002 (the
    Second Quarter 2002
    Form 10-Q).3
(b)

Bylaws of the registrant effective May 15, 2002,
    incorporated by reference to Exhibit 3(b) to the Second
    Quarter 2002
    Form 10-Q.4
(a)

Term Credit Agreement between The Bank of Nova Scotia and other
    financial institutions and the registrant dated
    September 25, 2001, incorporated by reference to
    Exhibit 4(a) to the registrants report on
    Form 10-Q
    for the quarterly period ended September 30, 2001.4
(b)

Syndicated Term Credit Facility Amending Agreement between The
    Bank of Nova Scotia and other financial institutions and the
    registrant dated as of September 23, 2003, incorporated by
    reference to Exhibit 4(b) to the registrants report
    on
    Form 10-Q
    for the quarterly period ended September 30, 2003 (the
    Third Quarter 2003
    Form 10-Q).4
(c)

Syndicated Term Credit Facility Second Amending Agreement
    between The Bank of Nova Scotia and other financial institutions
    and the registrant dated as of September 21, 2004,
    incorporated by reference to Exhibit 4(c) to the
    registrants report on
    Form 8-K
    dated September 21, 2004.4
(d)

Syndicated Term Credit Facility Third Amending Agreement between
    The Bank of Nova Scotia and other financial institutions and the
    registrant dated as of September 20, 2005, incorporated by
    reference to Exhibit 4(a) to the registrants report
    on
    Form 8-K
    dated September 22, 2005.4
(e)

Syndicated Term Credit Facility Fourth Amending Agreement
    between The Bank of Nova Scotia and other financial institutions
    and the registrant dated as of September 27, 2006,
    incorporated by reference to Exhibit 4(e) to the
    registrants report on
    Form 10-Q
    for the quarterly period ended September 30, 2006.4
(f)

Syndicated Term Credit Facility Fifth Amending Agreement between
    The Bank of Nova Scotia and other financial institutions and the
    registrant dated as of October 19, 2007, incorporated by
    reference to Exhibit 4(a) to the registrants report
    on
    Form 8-K
    dated October 22, 2007.4
(g)

Indenture dated as of June 16, 1997, between the registrant
    and The Bank of Nova Scotia Trust Company of New York,
    incorporated by reference to Exhibit 4(a) to the
    registrants report on
    Form 8-K
    dated June 18, 1997 (the 1997
    Form 8-K).4
(h)

Indenture dated as of February 27, 2003, between the
    registrant and The Bank of Nova Scotia Trust Company of New
    York, incorporated by reference to Exhibit 4(c) to the
    registrants report on
    Form 10-K
    for the year ended December 31, 2002 (the 2002
    Form 10-K).4
(i)

Form of Note relating to the registrants offering of
    $600,000,000 principal amount of 7.75% Notes due May 31,
    2011, incorporated by reference to Exhibit 4 to the
    registrants report on
    Form 8-K
    dated May 17, 2001.4
(j)

Form of Note relating to the registrants offering of
    $250,000,000 principal amount of 4.875% Notes due March 1,
    2013, incorporated by reference to Exhibit 4 to the
    registrants report on
    Form 8-K
    dated February 28, 2003.4
(k)

Form of Note relating to the registrants offering of
    $500,000,000 principal amount of 5.875% Notes due
    December 1, 2036, incorporated by reference to
    Exhibit 4(a) to the registrants report on
    Form 8-K
    dated November 29, 2006.    64




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##### Table of Contents



ExhibitNumber

Description of
    Document10
(a)

Sixth Voting Agreement dated April 22, 1978, between
    Central Canada Potash, Division of Noranda, Inc., Cominco Ltd.,
    International Minerals and Chemical Corporation (Canada)
    Limited, PCS Sales and Texasgulf Inc., incorporated by reference
    to Exhibit 10(f) to the registrants registration
    statement on
    Form F-1
    (File
    No. 33-31303)
    (the F-1 Registration Statement).10
(b)

Canpotex Limited Shareholders Seventh Memorandum of Agreement
    effective April 21, 1978, between Central Canada Potash,
    Division of Noranda Inc., Cominco Ltd., International Minerals
    and Chemical Corporation (Canada) Limited, PCS Sales, Texasgulf
    Inc. and Canpotex Limited as amended by Canpotex S&P
    amending agreement dated November 4, 1987, incorporated by
    reference to Exhibit 10(g) to the F-1 Registration
    Statement.10
(c)

Producer Agreement dated April 21, 1978, between Canpotex
    Limited and PCS Sales, incorporated by reference to
    Exhibit 10(h) to the F-1 Registration Statement.10
(d)

Canpotex/PCS Amending Agreement, dated as of October 1,
    1992, incorporated by reference to Exhibit 10(f) to the
    registrants report on
    Form 10-K
    for the year ended December 31, 1995 (the 1995
    Form 10-K).10
(e)

Canpotex PCA Collateral Withdrawing/PCS Amending Agreement,
    dated as of October 7, 1993, incorporated by reference to
    Exhibit 10(g) to the 1995
    Form 10-K.10
(f)

Canpotex Producer Agreement amending agreement dated as of
    January 1, 1999, incorporated by reference to
    Exhibit 10(f) to the registrants report on
    Form 10-K
    for the year ended December 31, 2000 (the 2000
    Form 10-K).10
(g)

Canpotex Producer Agreement amending agreement dated as of
    July 1, 2002, incorporated by reference to
    Exhibit 10(g) to the registrants report on
    Form 10-Q
    for the quarterly period ended June 30, 2004 (the
    Second Quarter 2004
    Form 10-Q).10
(h)

Esterhazy Restated Mining and Processing Agreement dated
    January 31, 1978, between International
    Minerals & Chemical Corporation (Canada) Limited and
    the registrants predecessor, incorporated by reference to
    Exhibit 10(e) to the F-1 Registration Statement.10
(i)

Agreement dated December 21, 1990, between International
    Minerals & Chemical Corporation (Canada) Limited and
    the registrant, amending the Esterhazy Restated Mining and
    Processing Agreement dated January 31, 1978, incorporated
    by reference to Exhibit 10(p) to the registrants
    report on
    Form 10-K
    for the year ended December 31, 1990.10
(j)

Agreement effective August 27, 1998, between International
    Minerals & Chemical (Canada) Global Limited and the
    registrant, amending the Esterhazy Restated Mining and
    Processing Agreement dated January 31, 1978 (as amended),
    incorporated by reference to Exhibit 10(l) to the 1998
    Form 10-K.10
(k)

Agreement effective August 31, 1998, among International
    Minerals & Chemical (Canada) Global Limited,
    International Minerals & Chemical (Canada) Limited
    Partnership and the registrant assigning the interest in the
    Esterhazy Restated Mining and Processing Agreement dated
    January 31, 1978 (as amended) held by International
    Minerals & Chemical (Canada) Global Limited to
    International Minerals & Chemical (Canada) Limited
    Partnership, incorporated by reference to Exhibit 10(m) to
    the 1998
    Form 10-K.10
(l)

Potash Corporation of Saskatchewan Inc. Stock Option
    Plan  Directors, as amended, incorporated by
    reference to Exhibit 10(l) to the registrants report
    on
    Form 10-K
    for the year ended December 31, 2006 (the 2006
    Form 10-K).10
(m)

Potash Corporation of Saskatchewan Inc. Stock Option
    Plan  Officers and Employees, as amended,
    incorporated by reference to Exhibit 10(m) to the 2006
    Form 10-K.10
(n)

Short-Term Incentive Plan of the registrant effective January
    2000, as amended, incorporated by reference to
    Exhibit 10(n) to the registrants report on
    Form 10-Q
    for the quarterly period ended June 30, 2007.10
(o)

Resolution and Forms of Agreement for Supplemental Retirement
    Income Plan, for officers and key employees of the registrant,
    incorporated by reference to Exhibit 10(o) to the 1995
    Form 10-K. 65




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##### Table of Contents



ExhibitNumber

Description of
    Document10
(p)

Amending Resolution and revised forms of agreement regarding
    Supplemental Retirement Income Plan of the registrant,
    incorporated by reference to Exhibit 10(x) to the
    registrants report on
    Form 10-Q
    for the quarterly period ended June 30, 1996.10
(q)

Amended and restated Supplemental Retirement Income Plan of the
    registrant and text of amendment to existing supplemental income
    plan agreements, incorporated by reference to
    Exhibit 10(mm) to the registrants report on
    Form 10-Q
    for the quarterly period ended September 30, 2000 (the
    Third Quarter 2000
    Form 10-Q).10
(r)

Form of Letter of amendment to existing supplemental income plan
    agreements of the registrant dated November 4, 2002,
    incorporated by reference to Exhibit 10(cc) to the 2002
    Form 10-K.10
(s)

Amended and restated agreement dated February 20, 2007,
    between the registrant and William J. Doyle concerning the
    Supplemental Retirement Income Plan, incorporated by reference
    to Exhibit 10(s) to the 2006
    Form 10-K.10
(t)

Supplemental Retirement Benefits Plan for U.S. Executives dated
    effective January 1, 1999, incorporated by reference to
    Exhibit 10(aa) to the Second Quarter 2002
    Form 10-Q.10
(u)

Forms of Agreement dated December 30, 1994, between the
    registrant and certain officers of the registrant, concerning a
    change in control of the registrant, incorporated by reference
    to Exhibit 10(p) to the 1995
    Form 10-K.10
(v)

Form of Agreement of Indemnification dated August 8, 1995,
    between the registrant and certain officers and directors of the
    registrant, incorporated by reference to Exhibit 10(q) to
    the 1995
    Form 10-K.10
(w)

Resolution and Form of Agreement of Indemnification dated
    January 24, 2001, incorporated by reference to
    Exhibit 10(ii) to the 2000
    Form 10-K.10
(x)

Resolution and Form of Agreement of Indemnification 
    July 21, 2004, incorporated by reference to
    Exhibit 10(ii) to the Second Quarter 2004
    Form 10-Q.10
(y)

Chief Executive Officer Medical and Dental Benefits,
    incorporated by reference to Exhibit 10(jj) to the
    Form 10-K
    for the year ended December 31, 2004.10
(z)

Second Amended and Restated Membership Agreement dated
    January 1, 1995, among Phosphate Chemicals Export
    Association, Inc. and members of such association, including
    Texasgulf Inc., incorporated by reference to Exhibit 10(t)
    to the 1995
    Form 10-K.10
(aa)

International Agency Agreement dated effective December 15,
    2006, between Phosphate Chemicals Export Association, Inc. and
    PCS Sales (USA), Inc., incorporated by reference to
    Exhibit 10(aa) to the 2006
    Form 10-K.10
(bb)

Deferred Share Unit Plan for Non-Employee Directors,
    incorporated by reference to Exhibit 4.1 to the
    registrants
    Form S-8
    (File
    No. 333-75742)
    filed December 21, 2001.10
(cc)

Potash Corporation of Saskatchewan Inc. 2005 Performance Option
    Plan and Form of Option Agreement, as amended, incorporated by
    reference to Exhibit 10(cc) to the 2006
    Form 10-K.10
(dd)

Potash Corporation of Saskatchewan Inc. 2006 Performance Option
    Plan and Form of Option Agreement, as amended, incorporated by
    reference to Exhibit 10(dd) to the 2006
    Form 10-K.10
(ee)

Potash Corporation of Saskatchewan Inc. 2007 Performance Option
    Plan and Form of Option Agreement, incorporated by reference to
    Exhibit 10(ee) to the registrants report on
    Form 10-Q
    for the quarterly period ended March 31, 2007.10
(ff)

Medium Term Incentive Plan of the registrant effective January
    2006, incorporated by reference to Exhibit 10(dd) to the
    registrants report on
    Form 10-K
    for the year ended December 31, 2005.11


Statement re Computation of Per Share Earnings.31
(a)

Certification pursuant to Section 302 of the
    Sarbanes-Oxley Act of 2002.31
(b)

Certification pursuant to Section 302 of the
    Sarbanes-Oxley Act of 2002.32


Certification pursuant to Section 906 of the
    Sarbanes-Oxley Act of 2002.  66