##### Table of Contents





UNITED STATES SECURITIES AND
    EXCHANGE COMMISSION
 Washington, 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
    June 30, 2011ORo

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
    Saskatoon, Saskatchewan, Canada(Address of principal
    executive offices)

S7K 7G3(Zip Code)    306-933-8500
 (Registrants telephone
    number, including area code)
   þ o
  Regulation S-T o o
  Rule 12b-2
  Large accelerated filer
    þ

Accelerated filer
    o

Non-accelerated
    filer o
    (Do not check if a smaller reporting company)

Smaller reporting
    company o   Rule 12b-2). Yes o þ




---





Part I. Financial
    Information
 TABLE OF CONTENTS  Part I. Financial InformationItem 1. Financial StatementsCondensed Consolidated Statements of Financial PositionCondensed Consolidated Statements of IncomeCondensed Consolidated Statements of Comprehensive Income (Loss)Condensed Consolidated Statements of Changes in EquityCondensed Consolidated Statements of Cash FlowNotes to the Condensed Consolidated 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 ProceduresItem 1. Legal ProceedingsItem 5. Other InformationItem 6. ExhibitsEX-11EX-31.AEX-31.BEX-32    Table of Contents   
  Item 1. Financial
    Statements
  Potash
    Corporation of Saskatchewan Inc.

    Condensed Consolidated Statements of Financial
    Position(in millions of US dollars)
    (unaudited)
  June 30,



December 31,2011



2010AssetsCurrent assetsCash and cash equivalents


$
408



$
412Receivables



1,268




1,059Inventories (Note 2)



597




570Prepaid expenses and other current assets



43




542,316




2,095Non-current assetsProperty, plant and equipment



8,909




8,141Investments in equity-accounted investees



1,100




1,051Available-for-sale
    investments



3,474




3,842Other assets



304




303Intangible assets



114




115Total Assets


$
16,217



$
15,547LiabilitiesCurrent liabilitiesShort-term debt and current portion of long-term debt
    (Note 3)


$
1,117



$
1,871Payables and accrued charges



1,291




1,198Current portion of derivative instrument liabilities



54




752,462




3,144Non-current liabilitiesLong-term debt (Note 3)



3,704




3,707Derivative instrument liabilities



184




204Deferred income tax liabilities



901




737Accrued pension and other post-retirement benefits



483




468Asset retirement obligations and accrued environmental costs



520




455Other non-current liabilities and deferred credits



108




147Total Liabilities



8,362




8,862Shareholders EquityShare capital (Note 4)



1,455




1,431Contributed surplus



342




308Accumulated other comprehensive income



2,054




2,394Retained earnings



4,004




2,552Total Shareholders Equity



7,855




6,685Total Liabilities and Shareholders Equity


$
16,217



$
15,547Contingencies (Note 10)    (See Notes to the Condensed
    Consolidated Financial Statements)
  1 PotashCorp
    2011 Second Quarter Quarterly Report on Form 10-Q




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##### Table of Contents



Potash
    Corporation of Saskatchewan Inc.

    Condensed Consolidated Statements of Income
    
    (in millions of US dollars except per-share amounts)
    (unaudited)
  Three Months Ended



Six Months EndedJune 30



June 302011



2010



2011



2010Sales(Note 5)


$
2,325



$
1,437



$
4,529



$
3,151Freight, transportation and distribution



(132
)



(99
)



(281
)



(254
)Cost of goods sold



(1,025
)



(753
)



(1,984
)



(1,583
)Gross Margin



1,168




585




2,264




1,314Selling and administrative expenses



(55
)



(33
)



(130
)



(93
)Provincial mining and other taxes



(60
)



(17
)



(94
)



(40
)Share of earnings of equity-accounted investees



66




45




117




71Dividend income



53




114




53




114Other income (expenses)



3




(15
)



(10
)



(21
)Operating Income



1,175




679




2,200




1,345Finance Costs



(38
)



(34
)



(88
)



(65
)Income Before Income Taxes



1,137




645




2,112




1,280Income Taxes(Note 7)



(297
)



(165
)



(540
)



(356
)Net Income


$
840



$
480



$
1,572



$
924Net Income Attributable to Common Shareholders


$
840



$
480



$
1,572



$
924Net Income per Share(Note 8)Basic


$
0.98



$
0.54



$
1.84



$
1.04Diluted


$
0.96



$
0.53



$
1.79



$
1.01Dividends per Share


$
0.07



$
0.03



$
0.14



$
0.07    (See Notes to the Condensed
    Consolidated Financial Statements)
  PotashCorp 2011 Second Quarter
    Quarterly Report on Form 10-Q  2




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##### Table of Contents



Potash
    Corporation of Saskatchewan Inc.

    Condensed Consolidated Statements of
    Comprehensive Income (Loss) 
    (in millions of US dollars)
    (unaudited)
  Three Months Ended



Six Months EndedJune 30



June 30(Net of related income taxes)


2011



2010



2011



2010Net Income


$
840



$
480



$
1,572



$
924Other comprehensive lossNet decrease in unrealized gains on
    available-for-sale
    investments(1)



(97
)



(848
)



(368
)



(722
)Net losses on derivatives designated as cash flow
    hedges(2)



(13
)



(11
)








(64
)Reclassification to income of net losses on cash flow
    hedges(3)



14




15




28




24Other



2




(3
)








(4
)Other Comprehensive Loss



(94
)



(847
)



(340
)



(766
)Comprehensive Income (Loss)


$
746



$
(367
)


$
1,232



$
158Comprehensive Income (Loss) Attributable to Common
    Shareholders


$
746



$
(367
)


$
1,232



$
158    (1)
    Available-for-sale
    investments are comprised of shares in Israel Chemicals Ltd. and
    Sinofert Holdings Limited.(2)
    Cash flow hedges are comprised of natural gas derivative
    instruments, and are net of income taxes of $(8)
    (2010  $(7)) for the three months ended June 30,
    2011 and $NIL (2010  $(39)) for the six months ended
    June 30, 2011.(3)
    Net of income taxes of $8 (2010  $8) for the three
    months ended June 30, 2011 and $16 (2010  $14)
    for the six months ended June 30, 2011.  (See Notes to the Condensed
    Consolidated Financial Statements)
  3 PotashCorp
    2011 Second Quarter Quarterly Report on Form 10-Q




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##### Table of Contents



Potash
    Corporation of Saskatchewan Inc.

    Condensed Consolidated Statements of Changes in
    Equity 
    (in millions of US dollars)
    (unaudited)
  Equity Attributable to Common ShareholdersAccumulated Other Comprehensive IncomeNet unrealized


ActuarialUnrealized


losses on


gains





Totalgains on


derivatives


(losses) on





Accumulatedavailable-for-


designated as


defined





OtherShare



Contributed


sale


cash flow


benefit





Comprehensive


Retained


TotalCapital



Surplus


investments


hedges


plans


Other


Income


Earnings


EquityBalance  January 1, 2011


$
1,431



$
308


$
2,563


$
(177
)

$

(1)

$
8


$
2,394


$
2,552


$
6,685Net income
































1,572



1,572Other comprehensive (loss) income












(368
)


28











(340
)






(340
)Effect of share-based compensation








34



























34Dividends declared
































(120
)


(120
)Issuance of common shares



24
































24Balance 
    June 30, 2011


$
1,455



$
342


$
2,195


$
(149
)

$

(1)

$
8


$
2,054


$
4,004


$
7,855   (1)

    Any amounts incurred during a period are cleared out to retained
    earnings at each period end. Therefore, no balance exists in the
    reserve at beginning or end of period.  Equity Attributable to Common ShareholdersAccumulated Other Comprehensive IncomeNet unrealized


ActuarialUnrealized


losses on


gains





Totalgains on


derivatives


(losses) on





Accumulatedavailable-for-


designated as


defined





OtherShare



Contributed


sale


cash flow


benefit





Comprehensive


Retained


TotalCapital



Surplus


investments


hedges


plans


Other


Income


Earnings


EquityBalance  January 1, 2010


$
1,430



$
273


$
1,900


$
(111
)

$

(1)

$
9


$
1,798


$
2,804


$
6,305Net income
































924



924Other comprehensive loss












(722
)


(40
)






(4
)


(766
)






(766
)Effect of share-based compensation








(21
)


























(21
)Dividends declared
































(59
)


(59
)Issuance of common shares



19
































19Balance  June 30, 2010


$
1,449



$
252


$
1,178


$
(151
)

$

(1)

$
5


$
1,032


$
3,669


$
6,402   (1)

    Any amounts incurred during a period are cleared out to retained
    earnings at each period end. Therefore, no balance exists in the
    reserve at beginning or end of period.  (See Notes to the Condensed
    Consolidated Financial Statements)
  PotashCorp 2011 Second Quarter
    Quarterly Report on Form 10-Q  4




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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



Six Months EndedJune 30



June 302011



2010



2011



2010Operating ActivitiesNet income


$
840



$
480



$
1,572



$
924Adjustments to reconcile net income to cash provided by
    operating activitiesDepreciation and amortization



128




109




252




219Share-based compensation



5




4




19




19Realized excess tax benefit related to share-based compensation



11




1




23




8Provision for deferred income tax



78




17




153




75Undistributed earnings of equity-accounted investees



1




(2
)



(50
)



(28
)Asset retirement obligations and accrued environmental costs



15




83




18




78Other



(8
)



48




(18
)



78Subtotal of adjustments



230




260




397




449Changes in non-cash operating working capitalReceivables



24




296




(189
)



390Inventories



6




(72
)



(21
)



(30
)Prepaid expenses and other current assets



12




(17
)



12




(11
)Payables and accrued charges



(48
)



49




(17
)



85Subtotal of changes in non-cash operating working capital



(6
)



256




(215
)



434Cash provided by operating activities



1,064




996




1,754




1,807Investing ActivitiesAdditions to property, plant and equipment



(492
)



(498
)



(933
)



(955
)Purchase of long-term investments


















(422
)Other assets and intangible assets



(3
)



(37
)



(3
)



(71
)Cash used in investing activities



(495
)



(535
)



(936
)



(1,448
)Cash before financing activities



569




461




818




359Financing ActivitiesProceeds from long-term debt obligations


















400Repayment of long-term debt obligations



(600
)



(250
)



(600
)



(400
)Proceeds from (repayments of) short-term debt obligations



94




(118
)



(159
)



(333
)Dividends



(60
)



(30
)



(88
)



(59
)Issuance of common shares



7




5




25




15Cash used in financing activities



(559
)



(393
)



(822
)



(377
)Increase (Decrease) in Cash and Cash Equivalents



10




68




(4
)



(18
)Cash and Cash Equivalents, Beginning of Period



398




299




412




385Cash and Cash Equivalents, End of Period


$
408



$
367



$
408



$
367Cash and cash equivalents comprised of:Cash


$
56



$
55



$
56



$
55Short-term investments



352




312




352




312$
408



$
367



$
408



$
367Supplemental cash flow disclosureInterest paid


$
92



$
63



$
133



$
105Income taxes paid (recovered)


$
149



$
(162
)


$
324



$
(140
)    (See Notes to the Condensed
    Consolidated Financial Statements)
  5 PotashCorp
    2011 Second Quarter Quarterly Report on Form 10-Q




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##### Table of Contents



Potash
    Corporation of Saskatchewan Inc.
  Notes to the Condensed Consolidated Financial
    Statements
 For the Three and Six Months Ended June 30, 2011
 (in millions of US dollars except share, per-share,
    percentage and ratio amounts)
 (unaudited)
   1.
    Significant
    Accounting Policies   Basis of
    Presentation
       Form 10-Q, Form 10-Q
    Form 10-Q,
  Form 10-Q.
  PotashCorp 2011 Second Quarter
    Quarterly Report on Form 10-Q  6




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##### Table of Contents



Recent Accounting
    Pronouncements
     IFRS
    9, Financial Instruments
     Amendments
    to IFRIC 14, Prepayments of a Minimum Funding
    Requirement
     Amendments
    to IFRS 7, Financial Instruments: Disclosures
      Amendments
    to IFRS 7, Disclosures  Transfers of Financial
    Assets
     IFRS
    10, Consolidated Financial Statements
     IFRS
    11, Joint Arrangements
     7 PotashCorp
    2011 Second Quarter Quarterly Report on Form 10-Q




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##### Table of Contents



IFRS
    12, Disclosure of Interest in Other Entities
     IFRS
    13, Fair Value Measurement
     Amendments
    to IAS 1, Presentation of Financial Statements
     Amendments
    to IAS 19, Employee Benefits
     2.
    Inventories   June 30,



December 31,2011



2010Finished products


$
267



$
255Intermediate products



117




127Raw materials



83




65Materials and supplies



130




123$
597



$
570    3.
    Long-Term
    Debt  10-year
  4.
    Share
    Capital  Authorized
     Issued
   Number ofCommon Shares


ConsiderationBalance  December 31, 2010


853,122,693


$
1,431Issued under option plans


2,397,153



23Issued for dividend reinvestment plan


19,065



1Balance 
    June 30, 2011


855,538,911


$
1,455    PotashCorp 2011 Second Quarter
    Quarterly Report on Form 10-Q  8




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##### Table of Contents



5.
    Segment
    Information    Three Months Ended June 30,
    2011Potash


Phosphate


Nitrogen


All
    Others


ConsolidatedSales

$
1,121


$
633


$
571


$



$
2,325Freight, transportation and distribution


(70
)


(40
)


(22
)






(132
)Net sales  third party


1,051



593



549



Cost of goods sold


(258
)


(427
)


(340
)






(1,025
)Gross margin


793



166



209







1,168Depreciation and amortization


(37
)


(57
)


(32
)


(2
)


(128
)Inter-segment sales










39







    Three Months Ended June 30, 2010Potash


Phosphate


Nitrogen


All Others


ConsolidatedSales

$
641


$
364


$
432


$



$
1,437Freight, transportation and distribution


(51
)


(28
)


(20
)






(99
)Net sales  third party


590



336



412



Cost of goods sold


(179
)


(287
)


(287
)






(753
)Gross margin


411



49



125







585Depreciation and amortization


(29
)


(48
)


(30
)


(2
)


(109
)Inter-segment sales










28







    Six Months Ended June 30,
    2011Potash


Phosphate


Nitrogen


All
    Others


ConsolidatedSales

$
2,230


$
1,182


$
1,117


$



$
4,529Freight, transportation and distribution


(153
)


(83
)


(45
)






(281
)Net sales  third party


2,077



1,099



1,072



Cost of goods sold


(541
)


(783
)


(660
)






(1,984
)Gross margin


1,536



316



412







2,264Depreciation and amortization


(79
)


(104
)


(65
)


(4
)


(252
)Inter-segment sales










77







    Six Months Ended June 30, 2010Potash


Phosphate


Nitrogen


All Others


ConsolidatedSales

$
1,533


$
765


$
853


$



$
3,151Freight, transportation and distribution


(147
)


(63
)


(44
)






(254
)Net sales  third party


1,386



702



809



Cost of goods sold


(445
)


(589
)


(549
)






(1,583
)Gross margin


941



113



260







1,314Depreciation and amortization


(59
)


(96
)


(60
)


(4
)


(219
)Inter-segment sales










54







     9 PotashCorp
    2011 Second Quarter Quarterly Report on Form 10-Q




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##### Table of Contents



Assets

Potash


Phosphate


Nitrogen


All Others


ConsolidatedAssets at June 30, 2011

$
6,675


$
2,583


$
1,847


$
5,112


$
16,217Assets at December 31, 2010

$
5,773


$
2,395


$
1,808


$
5,571


$
15,547Change in assets

$
902


$
188


$
39


$
(459
)

$
670Additions to property, plant and equipment
    (six months ended June 30, 2011)

$
745


$
92


$
64


$
32


$
933    6.
    Share-Based
    Compensation    Expected dividend

$
0.28Expected volatility


52%Risk-free interest rate


2.29%Expected life of options


5.5 years   7.
    Income
    Taxes      
    In first-quarter 2011, a current tax recovery of $21 for
    previously paid withholding taxes;
    To adjust the 2009 income tax provision to the income tax return
    filed, a current income tax expense of $18 was recorded in
    first-quarter 2010 along with a current income tax expense of
    $20 and a deferred income tax recovery of $11 in second-quarter
    2010;
    In first-quarter 2010, a current tax recovery of $10 for an
    anticipated refund of taxes paid related to forward exchange
    contracts.  PotashCorp 2011 Second Quarter
    Quarterly Report on Form 10-Q  10




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##### Table of Contents



June 30,

December 31,Income tax assets
    (liabilities)


Statements of Financial Position
    Location

2011

2010Current income tax assets:Current


Receivables

$
50


$
46Non-current


Other assets


123



122Deferred income tax assets


Other assets


29



38Total income tax assets




$
202


$
206Current income tax liabilities:Current


Payables and accrued charges

$
(226
)

$
(167
)Non-current


Other non-current liabilities and deferred credits


(102
)


(142
)Deferred income tax liabilities


Deferred income tax liabilities


(901
)


(737
)Total income tax liabilities




$
(1,229
)

$
(1,046
)     8.
    Net
    Income per Share        9.
    Seasonality    10.
    Contingencies  Canpotex
    Mining
    Risk
    Legal and Other
    Matters
  and/or
  
    The company, along with other parties, has been notified by the
    US Environmental Protection Agency (USEPA) of
    potential liability under the US Comprehensive Environmental
    Response, Compensation and Liability Act of 1980
    (CERCLA) with respect to certain soil and
    groundwater conditions at a site in Lakeland, Florida that
    includes a former PCS Joint Venture fertilizer blending facility
    and certain surrounding properties. A Record of Decision
    (ROD) was issued in September 2007 and provides for
    a remedy  11 PotashCorp
    2011 Second Quarter Quarterly Report on Form 10-Q




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##### Table of Contents



that requires excavation of impacted soils and interim treatment
    of groundwater. The total remedy cost is estimated in the ROD to
    be $9. In September 2010, the USEPA approved the Remedial Design
    Report to address the soil contamination. While subject to final
    construction inspection by the USEPA, the soil remediation has
    been performed.  
    The USEPA has identified PCS Nitrogen, Inc. (PCS
    Nitrogen) as a potentially responsible party with respect
    to a former fertilizer blending operation in Charleston, South
    Carolina known as the Planters Property or Columbia Nitrogen
    site, formerly owned by a company from which PCS Nitrogen
    acquired certain other assets. The USEPA has requested
    reimbursement of $3 of previously incurred response costs and
    the performance or financing of future site investigation and
    response activities from PCS Nitrogen and other named
    potentially responsible parties. In September 2005,
    Ashley II of Charleston, L.L.C., the current owner of the
    Planters Property, filed a complaint in the United States
    District Court for the District of South Carolina seeking a
    declaratory judgment that PCS Nitrogen is liable to pay
    environmental response costs that Ashley II of Charleston,
    L.L.C. alleges it has incurred and will incur in connection with
    response activities at the site. After the Phase II trial,
    the district court allocated 30 percent of the liability
    for response costs at the site to PCS Nitrogen, as well as a
    proportional share of any costs that cannot be recovered from
    another responsible party. PCS Nitrogen and other responsible
    parties filed motions for amendment of the decision, and the
    Court ruled on those motions in May 2011. The Courts
    amended judgment did not alter the 30 percent allocation of
    liability to PCS but did award relief to PCS under a contractual
    indemnification claim. PCS and another responsible party have
    since submitted post-judgment motions to the Court, which are
    pending, and PCS filed a notice of appeal to the United States
    Court of Appeals for the Fourth Circuit. The notice of appeal
    was subsequently stayed by the Fourth Circuit pending resolution
    of the post-judgment motions. The ultimate amount of liability
    for PCS Nitrogen, if any, depends upon the amount needed for
    remedial activities, the ability of other parties to pay and the
    availability of insurance.
    PCS Phosphate has agreed to participate, on a non-joint and
    several basis, with parties to an Administrative Settlement
    Agreement with the USEPA (Settling Parties) in the
    performance of a removal action and the payment of certain other
    costs associated with PCB soil contamination at the Ward
    Superfund Site in Raleigh, North Carolina (Site),
    including reimbursement of the USEPAs past costs. The
    removal activities commenced at the Site in August 2007. The
    cost of performing the removal action at the Site is estimated
    at $75. The Settling Parties have initiated CERCLA contribution
    litigation against PCS Phosphate and more than 100 other
    entities. PCS Phosphate filed crossclaims and counterclaims
    seeking cost recovery. In addition to the removal action at the
    Site, investigation of sediments downstream of the Site in what
    is called Operable Unit 1 has occurred. In September
    2008, the USEPA issued a final remedy for Operable Unit 1, with
    an estimated cost of $6. In response to a special notice letter
    from the USEPA, PCS Phosphate and the Settling Parties made a
    good-faith offer to perform
    and/or pay
    for certain actions described in the special notice letter. At
    this time, the company is unable to evaluate the extent of any
    exposure that it may have for the matters addressed in the
    special notice letter.
    Pursuant to the 1996 Corrective Action Consent Order (the
    Order) executed between PCS Nitrogen Fertilizer,
    L.P., formerly known as Arcadian Fertilizer, L.P. (PCS
    Nitrogen Fertilizer) and Georgia Department of Natural
    Resources, Environmental Protection Division (GEPD)
    in conjunction with PCS Nitrogen Fertilizers purchase of
    real property located in Augusta, Georgia from the entity from
    which PCS Nitrogen Fertilizer previously leased such property,
    PCS Nitrogen Fertilizer agreed to perform certain activities to
    investigate and, if necessary, perform a corrective action for
    substances in soil and groundwater. The investigation has
    proceeded and various corrective measures for substances in
    groundwater have been proposed to GEPD. PCS Nitrogen Fertilizer
    expects that it will implement corrective measures for
    substances in groundwater, but until GEPD approves the
    investigation results and a final corrective action plan, PCS
    Nitrogen Fertilizer is unable to estimate with reasonable
    certainty the total cost of its corrective action obligations
    under the Order.
    In December 2009, during a routine inspection of a gypsum stack
    at the White Springs, Florida facility, a sinkhole was
    discovered that resulted in the loss of approximately
    82 million gallons of water from the stack. The company is
    sampling production and monitoring wells on its property and
    drinking water wells on neighboring property to assess impacts.
    The company incurred costs of $17 to address the sinkhole
    between the time of discovery and June 30, 2011. In
    December 2010, the company entered into a consent order with the
    Florida Department of Environmental Protection pursuant to which
    the company agreed to, among other things, remediate the
    sinkhole and perform additional monitoring of the groundwater
    quality and hydrogeologic conditions related to the sinkhole
    collapse. The company also entered into an order on consent with
    the USEPA. In May 2011, the USEPA and the Board of Directors
    approved the companys proposal to implement certain
    mitigation measures to meet the goals of the USEPA order on
    consent. The company remeasured the asset retirement obligation
    (ARO) for the White Springs gypsum stacks to account
    for the measures identified in the proposal. This remeasurement
    resulted in a $39 adjustment to the ARO, of which $33 was
    capitalized as an addition to the related long-lived asset and
    $6 was expensed in the first quarter of 2011.  PotashCorp 2011 Second Quarter
    Quarterly Report on Form 10-Q  12




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##### Table of Contents



and/or
    
    The USEPA has an ongoing initiative to evaluate implementation
    within the phosphate industry of a particular exemption for
    mineral processing wastes under the hazardous waste program. In
    connection with this industry-wide initiative, the USEPA
    conducted inspections at numerous phosphate operations and
    notified the company of various alleged violations of the US
    Resource Conservation and Recovery Act (RCRA) at its
    plants in Aurora, North Carolina; Geismar, Louisiana; and White
    Springs, Florida. The company has entered into RCRA 3013
    Administrative Orders on Consent and has performed certain site
    assessment activities at all three plants. At this time, the
    company does not know the scope of corrective action, if any,
    that may be required. The company continues to participate in
    settlement discussions with the USEPA but is uncertain if any
    resolution will be possible without litigation, or, if
    litigation occurs, what the outcome would be. At this time, the
    company is unable to evaluate the extent of any exposure that it
    may have in these matters.
    The USEPA has also begun an initiative to evaluate compliance
    with the Clean Air Act at sulfuric acid and nitric acid plants.
    In connection with this industry-wide initiative, the USEPA has
    sent requests for information to numerous facilities, including
    the companys plants in Augusta, Georgia; Aurora, North
    Carolina; Geismar, Louisiana; Lima, Ohio; and White Springs,
    Florida. The USEPA has notified the company of various alleged
    violations of the Clean Air Act at its Geismar, Louisiana plant.
    The government has demanded process changes and penalties that
    would cost a total of approximately $27, but the company denies
    that it has any liability for the Geismar, Louisiana matter.
    Although the company is proceeding with planning and permitting
    for the process changes demanded by the government, the company
    is uncertain if any resolution will be possible without
    litigation, or, if litigation occurs, what the outcome would be.
    In July 2010, without alleging any specific violation of the
    Clean Air Act, the USEPA requested that the company meet and
    demonstrate compliance with the Clean Air Act for specified
    projects undertaken at the White Springs, Florida sulfuric acid
    plants. The company participated in such meeting but, at this
    time, is unable to evaluate if it has any exposure.
    Significant portions of the companys phosphate reserves in
    Aurora, North Carolina are located in wetlands. Under the Clean
    Water Act, the company must obtain a permit from the US Army
    Corps of Engineers (the Corps) before mining in the
    wetlands. In January 2009, the Division of Water Quality of the
    North Carolina Department of Natural Resources issued a
    certification under Section 401 of the Clean Water Act that
    mining of phosphate in excess of 30 years from lands owned
    or controlled by the company, including some wetlands, would not
    degrade water quality. Thereafter, in June 2009, the Corps
    issued the company a permit that will allow the company to mine
    the phosphate deposits identified in the Section 401
    certification. The USEPA decided not to seek additional review
    of the permit. In March 2009, four environmental organizations
    (Pamlico-Tar River Foundation, North Carolina Coastal
    Federation, Environmental Defense Fund and Sierra Club) filed a
    Petition for a Contested Case Hearing before the North Carolina
    Office of Administrative Hearings (OAH) challenging
    the Section 401 certification. The company has intervened
    in this proceeding. Cross motions for summary judgment by the
    Petitioners and the company have been filed, briefed and argued.
    The OAH has not issued a decision on them. At this time, the
    company is unable to evaluate the extent of any exposure that it
    may have in this matter.
    In May 2009, the Canadian government announced that its new
    industrial greenhouse gas emissions policies will be coordinated
    with policies that may be implemented in the US. The Province of
    Saskatchewan is considering the adoption of greenhouse gas
    emission control requirements. Regulations pursuant to the
    Management and Reduction of Greenhouse Gases Act in
    Saskatchewan, which impose a type of carbon tax to achieve a
    goal of a 20 percent reduction in greenhouse gas emissions
    by 2020 compared to 2006 levels, may become effective in 2012.
    There is no certainty as to the scope or timing of any final,
    effective provincial requirements. Although the US Congress has
    not passed any greenhouse gas emission control laws, the USEPA
    has adopted several rules to control greenhouse gas emissions
    using authority under existing environmental laws. In January
    2011, the USEPA began phasing in requirements for all
    stationary sources, such as the companys
    plants, to obtain permits incorporating the best available
    control technology for greenhouse gas emissions at a
    source if it is a new source that could emit 100,000 tons of
    greenhouse gases per year or if it is a modified source that
    increases such emissions by 75,000 tons per year. The company is
    not currently aware of any projects at its facilities that would
    be subject to these requirements. The company is monitoring
    these developments, and, except as indicated above, their effect
    on its operations cannot be determined with certainty at this
    time.  13 PotashCorp
    2011 Second Quarter Quarterly Report on Form 10-Q




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##### Table of Contents




    In December 2010, the USEPA issued a final rule to restrict
    nutrient concentrations in surface waters in Florida to levels
    below those currently permitted at the companys White
    Springs, Florida plant. The revised nutrient criteria will
    become part of Floridas water quality standards in March
    2012. Projected capital costs resulting from the rule could be
    in excess of $100 for the companys White Springs, Florida
    plant, and there is no guarantee that controls can be
    implemented that are capable of achieving compliance with the
    revised nutrient standards under all flow conditions. This
    estimate assumes that the rule survives court challenges and
    that none of the site-specific mechanisms for relief from the
    revised nutrient criteria are available to the White Springs,
    Florida plant. Various judicial challenges to the rule have been
    filed, including one lawsuit by The Fertilizer Institute
    (TFI) and White Springs. On June 15, 2011, TFI,
    White Springs and additional parties filed a Motion for Summary
    Judgment seeking, among other things, to vacate the USEPA rule.
    The prospects for a rule to be implemented as issued by the
    USEPA and the availability of the site-specific mechanisms are
    uncertain.
    The company, having been unable to agree with Mosaic Potash
    Esterhazy Limited Partnership (Mosaic) on the
    remaining amount of potash that the company is entitled to
    receive from Mosaic pursuant to the mining and processing
    agreement in respect of the companys rights at the
    Esterhazy mine, issued a Statement of Claim in the Saskatchewan
    Court of Queens Bench (Court) against Mosaic
    on May 27, 2009 and the claim was amended on
    January 19, 2010. In the Amended Statement of Claim, the
    company has asserted that it has the right under the mining and
    processing agreement to receive potash from Mosaic until at
    least 2012 and potentially much later, and seeks an order from
    the Court declaring the amount of potash which the company has
    the right to receive. Mosaic, in its Statement of Defence,
    asserts that at a delivery rate of 1.24 million tons of
    product per year, the companys entitlement to receive
    potash under the mining and processing agreement would terminate
    August 30, 2010.        
    Between September and October 2008, the company and PCS Sales
    (USA), Inc. were named as defendants in eight similar antitrust
    complaints filed in US federal courts. Other potash producers
    are also defendants in these cases. Each of the separate
    complaints alleges conspiracy to fix potash prices, to divide
    markets, to restrict supply and to fraudulently conceal the
    conspiracy, all in violation of Section 1 of the Sherman
    Act. The company and PCS Sales (USA), Inc. believe each of these
    eight private antitrust lawsuits is without merit and intend to
    defend them vigorously.        PotashCorp 2011 Second Quarter
    Quarterly Report on Form 10-Q  14




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##### Table of Contents



11.
    Related
    Party Transactions    12.
    Reconciliation
    of IFRS and US GAAP    (a) Inventories:
    (b) Long-term investments:
  (c) Property, plant and equipment:
      (d) Impairment of assets:
  first-day-of-the-month
    (e) Depreciation and amortization:
  (f) Exploration costs:
  (g) Pension and other post-retirement
    benefits:
  15 PotashCorp
    2011 Second Quarter Quarterly Report on Form 10-Q




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##### Table of Contents



(h) Offsetting of certain amounts:
  (i) Share-based compensation:
  Performance


Service Period CommencedOption Plan Year


IFRS


US GAAP2008



January 1, 2008



May 8, 20082009



January 1, 2009



May 7, 20092010



January 1, 2010



May 6, 20102011



January 1, 2011



May 12, 2011       (j) Stripping costs:
  (k) Provisions:
    (l) Income taxes related to the above
    adjustments:
  (m) Income taxes related to US GAAP effective income tax
    rate:
  (n) Income tax consequences of share-based employee
    compensation:
    PotashCorp 2011 Second Quarter
    Quarterly Report on Form 10-Q  16




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##### Table of Contents



(o) Uncertain income tax positions:
  (p) Income taxes related to intragroup
    transactions:
  (q) Classification of deferred income
    taxes:
  (r) Cash flow statements:
   17 PotashCorp
    2011 Second Quarter Quarterly Report on Form 10-Q




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##### Table of Contents



The application of US GAAP, as described above, would have
    had the following effects on net income, net income per share,
    total assets and shareholders equity.
  Three Months Ended



Six Months EndedJune 30



June 302011



2010



2011


2010Net income as reported  IFRS


$
840



$
480



$
1,572


$
924Items increasing (decreasing) reported net incomeInventory
    valuation(a)








1








1Manufacturing cost
    variances(a)



7




(6
)



(14
)


(15
)Share of earnings of equity-accounted
    investees(b)



(1
)



1




(1
)


Major repairs and
    maintenance(c)



2




(8
)



(12
)


(8
)Borrowing
    costs(c)



3




3




7



6Asset impairment, writedowns and
    recoveries(d)








(31
)



(1
)


(32
)Depreciation and
    amortization(e)



3




2




5



4Exploration
    costs(f)



(1
)



(1
)



(1
)


(1
)Pension and other post-retirement
    benefits(g)



(5
)



(6
)



(10
)


(12
)Share-based
    compensation(i)



(11
)



(11
)



2



1Stripping
    costs(j)



1




(6
)



5



(15
)Asset retirement
    obligations(k)



4




24




11



25Deferred income taxes relating to the above
    adjustments(l)



(1
)



7




2



10Income taxes related to US GAAP effective income tax
    rate(m)



(6
)



6




2



2Uncertain income tax
    positions(o)



1




(23
)



6



(9
)Income taxes related to intragroup
    transactions(p)



(8
)



9




(3
)


18Net income  US GAAP


$
828



$
441



$
1,570


$
899Basic weighted average shares outstanding  US GAAP



854,997,000




889,128,000




854,518,000



888,744,000Diluted weighted average shares outstanding  US
    GAAP(i)



876,516,000




913,377,000




876,600,000



913,768,000Basic net income per share  US GAAP


$
0.97



$
0.50



$
1.84


$
1.01Diluted net income per share  US GAAP


$
0.94



$
0.48



$
1.79


$
0.98      June 30,



December 31,2011



2010Total assets as reported  IFRS


$
16,217



$
15,547Items increasing (decreasing) reported total assetsInvestment in equity-accounted
    investees(b)



43




40Property, plant and
    equipment(d,

    e)



(104
)



(109
)Major repairs and
    maintenance(c)



(64
)



(52
)Borrowing
    costs(c)



32




25Goodwill(d)



(47
)



(47
)Asset impairment, writedowns and
    recoveries(d)



(6
)



(5
)Exploration
    costs(f)



(15
)



(14
)Margin deposits associated with derivative
    instruments(h)



(162
)



(198
)Stripping
    costs(j)



(57
)



(62
)Asset retirement
    obligations(k)



(46
)



(46
)Uncertain income tax
    positions(o)



(122
)



(122
)Income taxes related to intragroup
    transactions(p)



27




15Deferred income tax asset due to US GAAP adjustments



(13
)



(13
)Reclassification of deferred income
    taxes(q)



18




28Total assets  US GAAP


$
15,701



$
14,987     PotashCorp 2011 Second Quarter
    Quarterly Report on Form 10-Q  18




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##### Table of Contents



June 30,



December 31,2011



2010Total shareholders equity as reported  IFRS


$
7,855



$
6,685Items increasing (decreasing) reported shareholders equityManufacturing cost
    variances(a)



(14
)



Share of earnings of equity-accounted
    investees(b)



41




42Major repairs and
    maintenance(c)



(64
)



(52
)Borrowing
    costs(c)



32




25Asset impairment, writedowns and
    recoveries(d)



(257
)



(256
)Depreciation and
    amortization(e)



100




95Exploration
    costs(f)



(15
)



(14
)Pension and other post-retirement
    benefits(g)



13




13Stripping
    costs(j)



(57
)



(62
)Asset retirement
    obligations(k)



90




79Constructive
    obligations(k)



5




5Deferred income taxes relating to the above
    adjustments(l)



14




12Income taxes related to US GAAP effective income tax
    rate(m)



(45
)



(47
)Deferred income taxes on share-based
    compensation(n)



(143
)



(148
)Uncertain income tax
    positions(o)



39




33Income taxes related to intragroup
    transactions(p)



3




6Shareholders equity  US GAAP


$
7,597



$
6,416    References relate to differences
    between IFRS and US GAAP described above.
  Supplemental US
    GAAP Disclosures
  Disclosures
    About Derivative Instruments and Hedging Activities
    Fair Values of
    Derivative Instruments in the Condensed Consolidated Statements
    of Financial Position
  June 30,


December 31,Derivative Instrument Assets
    (Liabilities)(1)


Statements of Financial Position
    Location

2011


2010Derivatives designated as hedging instruments:Natural gas derivatives


Prepaid expenses and other current assets

$
1


$
Natural gas derivatives


Other assets


1



Natural gas derivatives


Current portion of derivative instrument liabilities


(54
)


(75
)Natural gas derivatives


Derivative instrument liabilities


(184
)


(204
)Total derivatives designated as hedging instruments





(236
)


(279
)Derivatives not designated as hedging instruments:Foreign currency derivatives


Prepaid expenses and other current assets


5



5Total derivatives not designated as hedging instruments




$
5


$
5    (1) All
    fair value amounts are gross and exclude netted cash collateral
    balances.
  19 PotashCorp
    2011 Second Quarter Quarterly Report on Form 10-Q




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##### Table of Contents



The Effect of
    Derivative Instruments on the Condensed Consolidated Statements
    of Income for the Three Months Ended June 30
  Amount of LossAmount of Loss




Recognized inReclassified




Incomefrom




(IneffectiveAmount of Loss




Accumulated


Location of Loss

PortionRecognized in


Location of

OCI


Recognized in Income

and AmountOCI


Loss Reclassified

into Income


(Ineffective Portion

Excluded fromDerivatives in Cash


(Effective


from Accumulated

(Effective


and Amount

EffectivenessFlow Hedging


Portion)


OCI into Income

Portion)


Excluded from

Testing)Relationships


2011



2010


(Effective Portion)

2011


2010


Effectiveness Testing)

2011


2010Natural gas derivatives


$
(21
)


$
(18
)

Cost of goods sold

$
(22
)

$
(23
)

Cost of goods sold

$



$
    Amount of Gain (Loss)Recognized inIncomeDerivatives Not Designated as Hedging Instruments


Location of Gain (Loss) Recognized in Income

2011


2010Foreign currency derivatives


Other income (expenses)

$
8


$
(7
)    The Effect of
    Derivative Instruments on the Condensed Consolidated Statements
    of Income for the Six Months Ended June 30
  Amount of LossAmount of Loss




Recognized inReclassified




Incomefrom




(IneffectiveAmount of Loss




Accumulated


Location of Loss

PortionRecognized in


Location of

OCI


Recognized in Income

and AmountOCI


Loss Reclassified

into Income


(Ineffective Portion

Excluded fromDerivatives in Cash


(Effective


from Accumulated

(Effective


and Amount

EffectivenessFlow Hedging


Portion)


OCI into Income

Portion)


Excluded from

Testing)Relationships


2011



2010


(Effective Portion)

2011


2010


Effectiveness Testing)

2011


2010Natural gas derivatives


$




$
(103
)

Cost of goods sold

$
(44
)

$
(38
)

Cost of goods sold

$



$
    Amount of Gain (Loss)Recognized inIncomeDerivatives Not Designated as Hedging Instruments


Location of Gain (Loss) Recognized in Income

2011


2010Foreign currency derivatives


Other income (expenses)

$
11


$
(9
)    PotashCorp 2011 Second Quarter
    Quarterly Report on Form 10-Q  20




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##### Table of Contents



Financial
    Instruments and Related Risk Management
  Financial
    Risks
    Credit
    Risk
      Liquidity
    Risk
      Market
    Risk
    Foreign Exchange
    Risk
    Price
    Risk
    21 PotashCorp
    2011 Second Quarter Quarterly Report on Form 10-Q




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##### Table of Contents



Fair
    Value
  point-in-time
    June 30, 2011


December 31, 2010Carrying Amount



Fair Value


Carrying Amount


Fair Valueof Asset (Liability)



of Asset (Liability)


of Asset (Liability)


of Asset (Liability)Derivative instrument assetsNatural gas derivatives


$
2



$
2


$



$
Foreign currency derivatives



5




5



5



5Investments in ICL and Sinofert



3,474




3,474



3,842



3,842Derivative instrument liabilitiesNatural gas derivatives



(238
)



(238
)


(279
)


(279
)Long-term debtSenior notes



(3,750
)



(3,983
)


(4,350
)


(4,525
)Other



(7
)



(7
)


(8
)


(8
)          Fair Value Measurements at Reporting Date Using:Quoted Prices in






SignificantActive Markets for



Significant Other


UnobservableCarrying Amount of



Identical Assets



Observable Inputs


InputsDescription


Asset (Liability)



(Level 1)



(Level 2)


(Level 3)June 30, 2011Derivative instrument assetsNatural gas derivatives


$
2



$




$



$
2
(1)Foreign currency derivatives



5









5
(1)


Investments in ICL and Sinofert



3,474




3,474
(1)







Derivative instrument liabilitiesNatural gas derivatives



(238
)








(33
)(1)


(205
)(1)December 31, 2010Derivative instrument assetsForeign currency derivatives


$
5



$




$
5


$
Investments in ICL and Sinofert



3,842




3,842








Derivative instrument liabilitiesNatural gas derivatives



(279
)








(55
)


(224
)   (1) During
    the period ending June 30, 2011, there were no transfers
    between Level 1 and Level 2, or into or out of
    Level 3. Company policy is to recognize transfers at the
    end of the reporting period.
  PotashCorp 2011 Second Quarter
    Quarterly Report on Form 10-Q  22




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##### Table of Contents



Fair
    Value Measurements Using Significant Unobservable Inputs
    (Level 3)
  Natural Gas Hedging DerivativesSix Months



Twelve MonthsEnded



EndedJune 30,



December 31,2011



2010Balance, beginning of period


$
(224
)


$
(119
)Total losses (realized and unrealized) before income taxesIncluded in earnings (cost of goods sold)



(13
)



(36
)Included in other comprehensive income



17




(126
)Settlements



17




46Transfers out of Level 3








11Balance, end of period


$
(203
)


$
(224
)    Pension
    and Other Post-Retirement Expenses
  Three Months Ended June 30



Six Months Ended June 30Defined Benefit Pension Plans


2011



2010



2011



2010Service cost


$
6



$
5



$
12



$
10Interest cost



12




11




24




23Expected return on plan assets



(13
)



(11
)



(26
)



(23
)Net amortization



6




6




12




13Net expense


$
11



$
11



$
22



$
23    Three Months Ended June 30



Six Months Ended June 30Other Post-Retirement Plans


2011



2010



2011



2010Service cost


$
2



$
2



$
4



$
4Interest cost



4




4




8




8Net amortization













(1
)



(1
)Net expense


$
6



$
6



$
11



$
11      Uncertainty
    in Income Taxes
    23 PotashCorp
    2011 Second Quarter Quarterly Report on Form 10-Q




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##### Table of Contents



Guarantees
    back-to-back
    agreed-upon
        PotashCorp 2011 Second Quarter
    Quarterly Report on Form 10-Q  24




---



##### Table of Contents



Recent Accounting
    Pronouncements
  Fair
    Value Measurements
    Comprehensive
    Income
    13.
    Transition
    to IFRS    Changes in
    Accounting Policies
  Form 10-Q. Form 10-Q
  AccountingPolicy Area


Differences from Previous Canadian GAAP(a) Employee Benefits


Actuarial gains and losses will be recognized directly in other
    comprehensive income rather than through profit or loss.IAS 19 requires the past service
    cost element of defined benefit plans to be expensed on an
    accelerated basis, with vested past service costs expensed
    immediately and unvested past service costs recognized on a
    straight-line basis until the benefits become vested. Under
    Canadian GAAP, past service costs were generally amortized on a
    straight-line basis over the average remaining service period of
    active employees expected under the plan.Under Canadian GAAP, certain gains
    and losses which were unrecognized at the time of adopting the
    current Canadian accounting standard were permitted to be
    amortized over a period under transitional provisions of the
    current standards. Those amounts must be recognized on
    transition to IFRS.  25 PotashCorp
    2011 Second Quarter Quarterly Report on Form 10-Q




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##### Table of Contents



AccountingPolicy Area


Differences from Previous Canadian GAAP(b) Provisions (including
    Asset Retirement Obligations)


IAS 37, Provisions, Contingent Liabilities and Contingent
    Assets, requires a provision to be recognized when: there
    is a present obligation (legal or constructive) as a result of a
    past transaction or event; it is probable that an outflow of
    resources will be required to settle the obligation; and a
    reliable estimate can be made of the obligation.
    Probable in this context means more likely than not.
    Under Canadian GAAP, constructive obligations were recognized
    only if required by a specific standard, and the criterion for
    recognition in the financial statements was likely,
    which is a higher threshold than probable.
    Therefore, it is possible that there may be some contingent
    liabilities not recognized under Canadian GAAP which would
    require a provision under IFRS.Other differences between IFRS and
    Canadian GAAP exist in relation to the measurement of
    provisions, such as the methodology for determining the best
    estimate where there is a range of equally possible outcomes
    (IFRS uses the mid-point of the range whereas Canadian GAAP used
    the low end), and the requirement under IFRS for provisions to
    be discounted where material.In relation to asset retirement
    obligations, measurement under IFRS will be based on
    managements best estimate, while measurement under
    Canadian GAAP was based on the fair value of the obligation
    (which takes market assumptions into account). Under IFRS, the
    full asset retirement obligation will be remeasured each period
    using the current discount rate. Under Canadian GAAP, cash flow
    estimates associated with asset retirement obligations were
    discounted using historical discount rates. Changes in the
    discount rate alone did not result in a remeasurement of the
    liability. Changes in estimates that decreased the liability
    were discounted using the discount rate applied upon initial
    recognition of the liability. When changes in estimates
    increased the liability, the additional liability was discounted
    using the current discount rate.IFRS require the companys
    asset retirement obligations to be discounted using a risk-free
    rate. Under Canadian GAAP, asset retirement obligations were
    discounted using a credit-adjusted risk-free rate.Under IFRS, the increase in the
    measurement of an asset retirement obligation due to the passage
    of time (unwinding of the discount) will be classified as a
    finance expense. Under Canadian GAAP, this amount was classified
    as an operating expense.(c) Investments


Under IFRS, jointly controlled entities will be accounted for
    using the equity method. Under Canadian GAAP, joint ventures
    were accounted for using proportionate consolidation.Certain of the companys
    equity-accounted investees adopted IFRS earlier than PotashCorp,
    resulting in certain IFRS 1 elections being made, particularly
    related to use of fair value as deemed cost on certain items of
    property, plant and equipment and related to the use of the
    business combinations exemption. As a result, the company will
    recognize its share of such elections as an adjustment to its
    opening retained earnings and its investments in
    equity-accounted investees.(d) Property, Plant and Equipment


Under IFRS, where part of an item of property, plant and
    equipment has a cost that is significant in relation to the cost
    of the item as a whole, it must be depreciated separately from
    the remainder of the item. Canadian GAAP was similar in this
    respect; however, the componentization concept was not often
    applied to the same extent due to practicality and/or
    materiality.Under IFRS, the cost of major
    overhauls on items of property, plant and equipment will be
    capitalized as a component of the related item of property,
    plant and equipment and amortized over the period until the next
    major overhaul. Under Canadian GAAP, these costs were expensed
    in the year incurred.(e) Borrowing Costs


Under IFRS, borrowing costs will be capitalized to assets which
    take a substantial time to develop or construct using a
    capitalization rate based on the weighted average interest rate
    on all of the companys outstanding third-party debt. Under
    the companys Canadian GAAP policy, the interest
    capitalization rate was based only on the weighted average
    interest rate on third-party long-term debt.(f) Inventories


Under IFRS, at interim periods, price, efficiency, spending and
    volume variances of a manufacturing entity will be recognized in
    income to the same extent that those variances will be
    recognized in income at financial year-end. Under IFRS, deferral
    of variances that are expected to be absorbed by year-end is not
    appropriate because it could result in reporting inventory at
    the interim date at more or less than its portion of the actual
    cost of manufacture. Under Canadian GAAP, variances that were
    planned and expected to be absorbed by the end of the year were
    ordinarily deferred at the end of an interim period. Net income
    and equity for annual periods will not be affected.  PotashCorp 2011 Second Quarter
    Quarterly Report on Form 10-Q  26




---



##### Table of Contents



AccountingPolicy Area


Differences from Previous Canadian GAAP(g) Impairment of
    Assets


IAS 36, Impairment of Assets, uses a one-step
    approach for both testing for and measurement of impairment,
    with asset carrying values compared directly with the higher of
    fair value less costs to sell and value in use (which uses
    discounted future cash flows). Canadian GAAP generally used a
    two-step approach to impairment testing, first comparing asset
    carrying values with undiscounted future cash flows to determine
    whether impairment exists, and then measuring any impairment by
    comparing asset carrying values with fair values. This
    difference may potentially result in more impairments where
    carrying values of assets were previously supported under
    Canadian GAAP on an undiscounted cash flow basis, but could not
    be supported on a discounted cash flow basis.In addition, IAS 36 requires the
    reversal of any previous impairment losses (to the amounts the
    assets would now be carried at had depreciation continued) where
    circumstances have changed such that the impairments have been
    reduced. Canadian GAAP prohibited reversal of impairment losses.(h) Share-Based Payments


IFRS 2, Share-Based Payments, requires that
    cash-settled share-based payments to employees be measured (both
    initially and at each reporting date) based on fair value of the
    awards. Canadian GAAP required that such payments be measured
    based on intrinsic value of the awards. This difference is
    expected to impact the accounting measurement of some of the
    companys cash-settled employee incentive plans, such as
    its performance unit incentive plan.IFRS 2 requires an estimate of
    compensation cost to be recognized in relation to performance
    options for which service has commenced but which have not yet
    been granted. The compensation cost recognized would then be
    trued up once options have been granted. Under Canadian GAAP,
    compensation cost was first recognized when the options were
    granted. This will create a timing difference between IFRS and
    Canadian GAAP in terms of when compensation cost relating to
    employee service provided in the first quarter of the year is
    recognized. In relation to stock option costs in 2010, net
    income will decrease in the first quarter and increase in the
    second quarter by $13. Net income and equity for annual periods
    will not be affected.(i) Income Taxes


Under IFRS, the guidance in IAS 12, Income Taxes,
    will be used to determine the benefit to be received in relation
    to uncertain tax positions. This differs from the methodology
    used under Canadian GAAP.Under IFRS, deferred tax assets
    recognized in relation to share-based payment arrangements (for
    example, the companys employee stock option plan in the
    US) will be adjusted each period to reflect the amount of future
    tax deductions that the company expects to receive in excess of
    stock-based compensation recorded in the consolidated financial
    statements based on the current market price of the shares. The
    benefit of such amounts will be recognized in contributed
    surplus and never impacts net income. Under the companys
    Canadian GAAP policy, tax deductions for its employee stock
    option plan in the US were recognized as reductions to tax
    expense, within net income, in the period that the deduction was
    allowed.Under IFRS, deferred tax assets
    associated with share-based compensation recorded in the
    consolidated financial statements as an expense in the current
    or previous period should be reviewed at each statement of
    financial position date and amended to the extent that it is no
    longer probable that the related tax benefit will be realized.
    Under Canadian GAAP, this income tax benefit was calculated
    without estimating the income tax effects of anticipated
    share-based payment transactions.Under IFRS, adjustments relating to
    a change in tax rates will be recognized in the same category of
    comprehensive income in which the original amounts were
    recognized. Under Canadian GAAP, such adjustments were
    recognized in net income, regardless of the category in which
    the original amounts were recognized. In addition, foreign
    exchange gains on deferred income tax liabilities would be
    recorded in other comprehensive income under IFRS, but were
    recorded in net income under Canadian GAAP.Under IFRS, deferred income taxes
    will be classified as long-term. Under Canadian GAAP, future
    income taxes were separated between current and long-term on the
    statement of financial position.Under IFRS, unrealized profits
    resulting from intragroup transactions will be eliminated from
    the carrying amount of assets, but no equivalent adjustment will
    be made for tax purposes. The difference between the tax rates
    of the two entities will impact net income. This differs from
    Canadian GAAP, where the current tax payable in relation to such
    profits was recorded as a current asset until the transaction
    was realized by the group.   27 PotashCorp
    2011 Second Quarter Quarterly Report on Form 10-Q




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##### Table of Contents



Reconciliations
    from Canadian GAAP to IFRS
  Reconciliation
    of Net Income
  Three Months


Six MonthsEnded


EndedJune 30,


June 30,2010


2010Net Income  Canadian GAAP


$
472


$
921IFRS adjustments to net income:Policy choicesEmployee benefits  Actuarial gains and
    losses(a)



7



13OtherProvisions  Changes in asset retirement
    obligations(b)



(24
)


(25
)Property, plant and
    equipment(d)



8



8Borrowing
    costs(e)



(4
)


(6
)Manufacturing cost variances at interim
    periods(f)



6



15Employee benefits  Past service
    costs(a)



(1
)


(1
)Impairment of
    assets(g)



(2
)


(1
)Share-based
    payments(h)



14



(1
)Income taxes  Tax effect of above differences



1



1Income tax-related
    differences(i)



3



Net Income  IFRS


$
480


$
924    References relate to items
    described in the Changes in Accounting Policies table above.
  Reconciliation
    of Shareholders Equity
  June 30,2010Shareholders Equity  Canadian GAAP










$
6,569IFRS adjustments to shareholders equity:Policy choicesEmployee benefits  Actuarial gains and
    losses(a)











(352
)OtherProvisions  Changes in asset retirement
    obligations(b)











(90
)Investments(c)











(45
)Property, plant and
    equipment(d)











27Borrowing
    costs(e)











(20
)Manufacturing cost variances at interim
    periods(f)











15Employee benefits  Past service costs and Canadian
    GAAP transition
    amounts(a)











12Impairment of
    assets(g)











6Constructive
    obligations(b)











(2
)Share-based
    payments(h)











1Income taxes  Tax effect of above differences











153Income tax-related
    differences(i)











128Shareholders Equity  IFRS










$
6,402    References relate to items
    described in the Changes in Accounting Policies table above.
  PotashCorp 2011 Second Quarter
    Quarterly Report on Form 10-Q  28




---



##### Table of Contents



Reconciliation
    of Comprehensive Income
  Three Months


Six MonthsEnded


EndedJune 30,


June 30,2010


2010Comprehensive Income  Canadian GAAP


$
(375
)

$
155IFRS adjustments to comprehensive income:Differences in net income



8



3Comprehensive Income  IFRS


$
(367
)

$
158    References relate to items
    described in the Changes in Accounting Policies table above.
  29 PotashCorp
    2011 Second Quarter Quarterly Report on Form 10-Q




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##### Table of Contents



Item 2. Managements
    Discussion and Analysis of Financial Condition and Results of
    Operations
  Form 10-K,
  Adoption
    of International Financial Reporting Standards (IFRS)
  Form 10-Q Form 10-Q,
  Form 10-Q Form 10-Q
    PotashCorp
    and Our Business Environment
        PotashCorp
    Strategy
        PotashCorp 2011 Second Quarter
    Quarterly Report on Form 10-Q  30




---



##### Table of Contents



Key
    Performance Drivers  Performance Compared to Goals
    Representative


PerformanceGoal


2011 Annual Target


to June 30, 2011Achieve no harm to people.


Reduce total site severity injury rate by 35 percent from
    2008 levels by the end of 2012.


Total site severity injury rate was 40 percent below the
    2008 annual level for the first six months of 2011. It was
    58 percent below the 2008 annual level for the first six
    months of 2010 and 62 percent below the 2008 annual level
    by the end of 2010.Achieve no damage to the environment.


Reduce total reportable releases, permit excursions and spills
    by 10 percent from 2010 levels.


Annualized total reportable releases, permit excursions and
    spills were down 20 percent during the first six months of
    2011 compared to 2010 annual levels. Compared to the first six
    months of 2010, total reportable releases, permit excursions and
    spills during the same period of 2011 were down 33 percent.Create superior long-term shareholder value.


Exceed total shareholder return performance for our sector and
    the DAXglobal Agribusiness Index for 2011.


PotashCorps total shareholder return was 11 percent
    in the first six months of 2011 compared to our sectors
    weighted average return (based on market capitalization) of
    1 percent and the DAXglobal Agribusiness Index weighted
    average return (based on market capitalization) of NIL percent.    Financial
    Overview
  Form 10-Q.
  Form 10-Q.
  Earnings
    Guidance  Second Quarter 2011
  Company Guidance

Actual ResultsEarnings per share


$0.70  $0.90

$0.96    Overview of
    Actual Results
  Three Months Ended June 30



Six Months Ended June 30Dollars (millions) 










%












%except per-share amounts

2011


2010


Change


Change



2011


2010


Change


ChangeSales

$
2,325


$
1,437


$
888



62



$
4,529


$
3,151


$
1,378



44Gross Margin


1,168



585



583



100




2,264



1,314



950



72Operating Income


1,175



679



496



73




2,200



1,345



855



64Net Income


840



480



360



75




1,572



924



648



70Net Income per Share  Diluted


0.96



0.53



0.43



81




1.79



1.01



0.78



77Other Comprehensive Loss


(94
)


(847
)


753



(89
)



(340
)


(766
)


426



(56
)    31 PotashCorp
    2011 Second Quarter Quarterly Report on Form 10-Q




---



##### Table of Contents



PotashCorp 2011 Second Quarter
    Quarterly Report on Form 10-Q  32




---



##### Table of Contents



Balance
    Sheet
  
  Available-for-sale
  10-year
    Operating Segment
    Review
     33 PotashCorp
    2011 Second Quarter Quarterly Report on Form 10-Q




---



##### Table of Contents



and/or
  Potash
  Three Months Ended June 30Dollars (millions)


Tonnes (thousands)


Average per
    Tonne(1)2011


2010


% Change


2011


2010


% Change


2011


2010


% ChangeSales

$
1,121


$
641



75Freight, transportation and distribution


(70
)


(51
)


37Net sales

$
1,051


$
590



78Manufactured productNet salesNorth America

$
409


$
213



92



831



575



45


$
492


$
370



33Offshore


640



375



71



1,690



1,329



27


$
379


$
282



341,049



588



78



2,521



1,904



32


$
416


$
309



35Cost of goods sold


(256
)


(185
)


38














$
(101
)

$
(97
)


4Gross margin


793



403



97














$
315


$
212



49Other miscellaneous and purchased productNet sales


2



2



Cost of goods sold


(2
)


6



n/mGross margin






8



(100
)Gross Margin

$
793


$
411



93














$
315


$
216



46    (1)

    Rounding differences may occur due to the use of whole dollars
    in per-tonne calculations.    Six Months Ended June 30Dollars (millions)


Tonnes (thousands)


Average per
    Tonne(1)2011


2010


% Change


2011


2010


% Change


2011


2010


% ChangeSales

$
2,230


$
1,533



45Freight, transportation and distribution


(153
)


(147
)


4Net sales

$
2,077


$
1,386



50Manufactured productNet salesNorth America

$
875


$
663



32



1,923



1,841



4


$
455


$
360



26Offshore


1,195



717



67



3,386



2,527



34


$
353


$
284



242,070



1,380



50



5,309



4,368



22


$
390


$
316



23Cost of goods sold


(536
)


(445
)


20














$
(101
)

$
(102
)


(1
)Gross margin


1,534



935



64














$
289


$
214



35Other miscellaneous and purchased productNet sales


7



6



17Cost of goods sold


(5
)






n/mGross margin


2



6



(67
)Gross Margin

$
1,536


$
941



63














$
289


$
215



34    (1)

    Rounding differences may occur due to the use of whole dollars
    in per-tonne calculations.    PotashCorp 2011 Second Quarter
    Quarterly Report on Form 10-Q  34




---



##### Table of Contents



Potash gross margin
    variance attributable to:
  Three Months Ended June 30



Six Months Ended June 302011 vs. 2010



2011 vs. 2010Change in











Change inPrices/Costs











Prices/CostsChange in



Net



Cost of







Change in



Net



Cost ofDollars (millions)


Sales Volumes



Sales



Goods Sold



Total



Sales Volumes



Sales



Goods Sold



TotalManufactured productNorth America


$
75



$
105



$
(3
)


$
177



$
24



$
183



$
11



$
218Offshore



79




164




(29
)



214




186




235




(39
)



382Change in market mix








(1
)








(1
)



27




(25
)



(3
)



(1
)Total manufactured product


$
154



$
268



$
(32
)


$
390



$
237



$
393



$
(31
)


$
599Other miscellaneous and purchased product


















(8
)


















(4
)Total

















$
382


















$
595    
  
   35 PotashCorp
    2011 Second Quarter Quarterly Report on Form 10-Q




---



##### Table of Contents



Three Months Ended June 30



Six Months Ended June 302011



2010



Change



% Change



2011



2010



Change



% ChangeAsia (excluding China and India)



51




47




4




9




48




49




(1
)



(2
)Latin America



32




18




14




78




30




18




12




67China



14




8




6




75




15




12




3




25India








20




(20
)



(100
)



3




14




(11
)



(79
)Oceania, Europe and Other



3




7




(4
)



(57
)



4




7




(3
)



(43
)100




100














100




100    (1)
  (1)

    Direction of arrows refers to impact on gross margin.  Net Sales Prices



Sales Volumes



Cost of Goods Soldá

Prices continued to move higher as previously announced
    increases began to be reflected in results, with our average
    second-quarter realized price climbing $107 and up $50 per tonne
    from first-quarter 2011.

ááá

Strong sales were due to highly supportive agricultural economics around the world.Canpotex shipments were higher to almost all offshore markets with the exception of India, which did not have a contract in the second quarter of 2011. The strongest demand came from Asian countries (other than China and India) and from Latin America.North American volumes were up on strong farmer demand and a lower comparative figure in the second quarter of 2010 as shipments slowed following record demand in the first quarter of 2010.

áââââ

No shutdown costs incurred in 2011 (five weeks taken in 2010) as facilities operated at or near their full capabilities.The Canadian dollar strengthened relative to the US dollar.Royalty costs rose due to higher sales prices.Personnel costs higher due to additional staffing.Offshore cost of goods sold negative variance was greater than North America due to relatively high offshore product coming from our higher-cost mines.    PotashCorp 2011 Second Quarter
    Quarterly Report on Form 10-Q  36




---



##### Table of Contents



(1)
  (1)
  Net Sales Prices



Sales Volumes



Cost of Goods Soldáá

Higher average realized prices reflected new pricing levels announced in late 2010 and early 2011 in both offshore and North American spot markets.Canpotex signed an agreement with China for the first half of 2011 at prices approximately $50 per tonne higher than the 2010 China contract.

áá

Record Canpotex shipments to offshore markets were the result of strong demand for potash due to high crop commodity prices and limited customer inventories at the start of the year.Canpotexs increased shipments to Latin America, Asia (excluding China and India) and China exceeded the decline in sales to India, which did not have a contract in the second quarter of 2011.

áââáâáâ

No shutdown costs incurred in 2011 (18 weeks taken in 2010) as facilities operated at or near their full capabilities.The Canadian dollar strengthened relative to the US dollar.Saskatchewan royalties increased due to higher prices.New Brunswick royalties were lower as inventories sold in 2010 included royalties based on higher 2009 average sales prices.Depreciation costs increased due to higher asset levels associated with our mine expansion activity.North American cost of goods sold variance was positive as a relatively higher percentage of products produced at lower-cost mines, or using lower-cost processes, was sold.Offshore cost of goods sold variance was negative due to more of that product coming from our higher-cost mines as compared to last year.          37 PotashCorp
    2011 Second Quarter Quarterly Report on Form 10-Q




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##### Table of Contents



Phosphate
  Three Months Ended June 30Dollars (millions)


Tonnes (thousands)


Average per
    Tonne(1)2011


2010


% Change


2011


2010


% Change


2011


2010


% ChangeSales

$
633


$
364



74Freight, transportation and distribution


(40
)


(28
)


43Net sales

$
593


$
336



76Manufactured productNet salesFertilizer  liquids

$
158


$
81



95



298



219



36


$
529


$
372



42Fertilizer  solids


234



98



139



398



215



85


$
588


$
456



29Feed


82



68



21



153



146



5


$
536


$
464



16Industrial


112



82



37



164



139



18


$
682


$
591



15586



329



78



1,013



719



41


$
578


$
458



26Cost of goods sold


(423
)


(284
)


49














$
(417
)

$
(395
)


6Gross margin


163



45



262














$
161


$
63



156Other miscellaneous and purchased productNet sales


7



7



Cost of goods sold


(4
)


(3
)


33Gross margin


3



4



(25
)Gross Margin

$
166


$
49



239














$
164


$
68



141    (1)

    Rounding differences may occur due to the use of whole dollars
    in per-tonne calculations.  Six Months Ended June 30Dollars (millions)


Tonnes (thousands)


Average per
    Tonne(1)2011


2010


% Change


2011


2010


% Change


2011


2010


% ChangeSales

$
1,182


$
765



55Freight, transportation and distribution


(83
)


(63
)


32Net sales

$
1,099


$
702



57Manufactured productNet salesFertilizer  liquids

$
328


$
162



102



647



467



39


$
507


$
349



45Fertilizer  solids


391



224



75



653



508



29


$
598


$
440



36Feed


153



139



10



288



313



(8
)

$
531


$
444



20Industrial


213



164



30



318



291



9


$
669


$
565



181,085



689



57



1,906



1,579



21


$
569


$
437



30Cost of goods sold


(776
)


(584
)


33














$
(407
)

$
(371
)


10Gross margin


309



105



194














$
162


$
66



145Other miscellaneous and purchased productNet sales


14



13



8Cost of goods sold


(7
)


(5
)


40Gross margin


7



8



(13
)Gross Margin

$
316


$
113



180














$
166


$
72



131    (1)

    Rounding differences may occur due to the use of whole dollars
    in per-tonne calculations.  PotashCorp 2011 Second Quarter
    Quarterly Report on Form 10-Q  38




---



##### Table of Contents



Three Months Ended June 30



Six Months Ended June 302011 vs. 2010



2011 vs. 2010Change in











Change inPrices/Costs











Prices/CostsChange in



Net



Cost of







Change in



Net



Cost ofDollars (millions)


Sales Volumes



Sales



Goods Sold



Total



Sales Volumes



Sales



Goods Sold



TotalManufactured productFertilizer  liquids


$
17



$
46



$
(23
)


$
40



$
37



$
102



$
(59
)


$
80Fertilizer  solids



39




56




(30
)



65




30




104




(44
)



90Feed



2




12




(7
)



7




(5
)



25




(7
)



13Industrial



9




15




(18
)



6




11




33




(23
)



21Change in market mix



3




(2
)



(1
)








12




(11
)



(1
)



Total manufactured product


$
70



$
127



$
(79
)


$
118



$
85



$
253



$
(134
)


$
204Other miscellaneous and purchased product


















(1
)


















(1
)Total

















$
117


















$
203    
  
  39 PotashCorp
    2011 Second Quarter Quarterly Report on Form 10-Q




---



##### Table of Contents



(1)
  (1)
  Net Sales Prices



Sales Volumes



Cost of Goods Soldááá

Realized prices for liquid and solid fertilizers were up as the prices of these products reflected the strength in global demand and the tight supply.Prices for feed products were up, responding less rapidly than fertilizer prices as a result of challenging livestock economics.Industrial prices rose, but not as much as fertilizers, as they are influenced by certain longer-term contracts that lag market conditions.

áá á

Strong agricultural fundamentals drove higher demand for fertilizer products  both liquids and solids  resulting in a larger allocation of sales volumes to these products.Solid products were further supported by increased spot sales.Industrial demand reflected increased US manufacturing activity.

ââ

Costs were impacted by higher sulfur costs (up 56 percent).Solid fertilizer costs also reflected higher ammonia costs (up 47 percent).  (1)
  (1)
  Net Sales Prices



Sales Volumes



Cost of Goods Soldáá

Prices for phosphate products were higher due to strong crop economics, historically low inventories at the start of 2011 and higher input prices.The largest price increases were evident in liquid and solid fertilizers, which rose on strong agricultural fundamentals and higher input costs.

áâ

Fertilizer volumes grew as we allocated more production to capitalize on the higher-margin opportunity in these product lines.Demand for feed products was impacted by higher grain prices which increased the use of substitute feed ingredients.

ââ â

Costs were impacted by higher sulfur costs (up 62 percent).Solid fertilizer costs also reflected higher ammonia costs (up 35 percent).Fertilizer costs were higher than feed and industrial costs due to a higher allocation of fixed costs (a result of fertilizer production volumes increasing more significantly than volumes for the other products).    PotashCorp 2011 Second Quarter
    Quarterly Report on Form 10-Q  40




---



##### Table of Contents



Nitrogen
  Three Months Ended June 30Dollars (millions)


Tonnes (thousands)


Average per
    Tonne(1)2011


2010


% Change


2011


2010


% Change


2011


2010


% ChangeSales

$
571


$
432



32Freight, transportation and distribution


(22
)


(20
)


10Net sales

$
549


$
412



33Manufactured productNet salesAmmonia

$
280


$
177



58



514



461



11


$
545


$
383



42Urea


130



100



30



316



324



(2
)

$
413


$
310



33Nitrogen solutions/Nitric acid/Ammonium nitrate


110



101



9



469



532



(12
)

$
234


$
190



23520



378



38



1,299



1,317



(1
)

$
400


$
287



39Cost of goods sold


(322
)


(258
)


25














$
(248
)

$
(196
)


27Gross margin


198



120



65














$
152


$
91



67Other miscellaneous and purchased productNet sales


29



34



(15
)Cost of goods sold


(18
)


(29
)


(38
)Gross margin


11



5



120Gross Margin

$
209


$
125



67














$
161


$
95



69    (1)

    Rounding differences may occur due to the use of whole dollars
    in per-tonne calculations.  Six Months Ended June 30Dollars (millions)


Tonnes (thousands)


Average per
    Tonne(1)2011


2010


% Change


2011


2010


% Change


2011


2010


% ChangeSales

$
1,117


$
853



31Freight, transportation and distribution


(45
)


(44
)


2Net sales

$
1,072


$
809



33Manufactured productNet salesAmmonia

$
524


$
324



62



1,028



891



15


$
510


$
364



40Urea


268



221



21



647



668



(3
)

$
414


$
331



25Nitrogen solutions/Nitric acid/Ammonium nitrate


222



200



11



964



1,080



(11
)

$
230


$
185



241,014



745



36



2,639



2,639






$
384


$
282



36Cost of goods sold


(621
)


(497
)


25














$
(235
)

$
(188
)


25Gross margin


393



248



58














$
149


$
94



59Other miscellaneous and purchased productNet sales


58



64



(9
)Cost of goods sold


(39
)


(52
)


(25
)Gross margin


19



12



58Gross Margin

$
412


$
260



58














$
156


$
99



58    (1)

    Rounding differences may occur due to the use of whole dollars
    in per-tonne calculations.  41 PotashCorp
    2011 Second Quarter Quarterly Report on Form 10-Q




---



##### Table of Contents



Three Months Ended June 30



Six Months Ended June 302011 vs. 2010



2011 vs. 2010Change in









Change inPrices/Costs









Prices/CostsChange in


Net


Cost of






Change in


Net


Cost ofDollars (millions)


Sales Volumes


Sales


Goods Sold


Total



Sales Volumes


Sales


Goods Sold


TotalManufactured productAmmonia


$
12


$
83


$
(39
)

$
56



$
28


$
150


$
(70
)

$
108Urea



(1
)


32



(13
)


18




(4
)


54



(19
)


31Solutions, NA, AN



(3
)


20



(14
)


3




(3
)


43



(26
)


14Hedge











1



1












(8
)


(8
)Change in market mix



(12
)


12












(22
)


22







Total manufactured product


$
(4
)

$
147


$
(65
)

$
78



$
(1
)

$
269


$
(123
)

$
145Other miscellaneous and purchased product















6
















7Total














$
84















$
152    
  
  PotashCorp 2011 Second Quarter
    Quarterly Report on Form 10-Q  42




---



##### Table of Contents



Three Months Ended June 30



Six Months Ended June 30Sales Tonnes (thousands)


Price per Tonne



Sales Tonnes (thousands)


Price per Tonne2011


2010


2011


2010



2011


2010


2011


2010Fertilizer



448



527


$
428


$
283




836



1,025


$
401


$
271Feed



8



6


$
502


$
380




16



14


$
496


$
402Industrial



843



784


$
385


$
290




1,787



1,600


$
375


$
2891,299



1,317


$
400


$
287




2,639



2,639


$
384


$
282    (1)
  (1)
  Net Sales Prices



Sales Volumes



Cost of Goods Soldá

Nitrogen fertilizer prices increased as a result of strong
    agricultural margins and limited global supplies of ammonia,
    urea and nitrogen solutions. Prices also continue to be affected
    by higher production costs in key producing regions.

áâ

Strong industrial and agricultural demand for ammonia resulted in a larger share of production being allocated to this higher-margin product.More production being allocated to ammonia limited production of nitrogen downstream products.

â

Average natural gas costs in production, including hedge,
    increased 30 percent. Natural gas costs in Trinidad
    production rose 55 percent (contract price indexed, in
    part, to ammonia prices) while our US spot costs for natural gas
    used in production increased 6 percent. Including hedge
    losses, US gas prices increased 1 percent.    (1)
  (1)
  Net Sales Prices



Sales Volumes



Cost of Goods Soldá

Realized prices increased as a result of tight global supplies
    for ammonia, urea and nitrogen solutions, higher production
    costs in Ukraine and Western Europe and stronger agricultural
    and industrial demand than in 2010.

á

Ammonia sales rose as a greater percentage of our production was
    allocated to this higher-margin product to meet strong
    industrial and agricultural demand, limiting production of
    downstream products.

â

Average natural gas costs in production, including hedge,
    increased 24 percent. Natural gas costs in Trinidad
    production rose 48 percent while our US spot costs for
    natural gas used in production decreased 10 percent.
    Including hedge losses, US gas prices decreased 2 percent.    Expenses and
    Other Income
  Three Months Ended June 30



Six Months Ended June 30Dollars (millions)


2011


2010


Change


% Change



2011


2010


Change


% ChangeSelling and administrative expenses


$
(55
)

$
(33
)

$
(22
)


67



$
(130
)

$
(93
)

$
(37
)


40Provincial mining and other taxes



(60
)


(17
)


(43
)


253




(94
)


(40
)


(54
)


135Share of earnings of equity-accounted investees



66



45



21



47




117



71



46



65Dividend income



53



114



(61
)


(54
)



53



114



(61
)


(54
)Other income (expenses)



3



(15
)


18



n/m




(10
)


(21
)


11



(52
)Finance costs



(38
)


(34
)


(4
)


12




(88
)


(65
)


(23
)


35Income taxes



(297
)


(165
)


(132
)


80




(540
)


(356
)


(184
)


52       43 PotashCorp
    2011 Second Quarter Quarterly Report on Form 10-Q




---



##### Table of Contents



10-year
  Three Months Ended June 30



Six Months Ended June 30Dollars (millions) 
    except percentage amounts


2011


2010


Change


% Change



2011


2010


Change


% ChangeLong-term debt obligations, including current portionWeighted average outstanding


$
4,258


$
3,430


$
828



24



$
4,308


$
3,477


$
831



24Weighted average effective interest rate



5.4%



5.8%



(0.4)%



(7)




5.5%



5.7%



(0.2)%



(4)Short-term debt obligationsWeighted average outstanding


$
954


$
451


$
503



112



$
1,029


$
532


$
497



93Weighted average effective interest rate



0.4%



0.5%



(0.1)%



(20)




0.3%



0.5%



(0.2)%



(40)Total debt obligationsWeighted average outstanding


$
5,212


$
3,881


$
1,331



34



$
5,337


$
4,009


$
1,328



33Weighted average effective interest rate



4.5%



5.2%



(0.7)%



(14)




4.5%



5.0%



(0.5)%



(10)      Liquidity
    and Capital Resources
  Cash
    Requirements
   Contractual
    Obligations and Other Commitments
   10-year Form 10-Q.
  PotashCorp 2011 Second Quarter
    Quarterly Report on Form 10-Q  44




---



##### Table of Contents



Capital
    Expenditures
    (1)
  ForecastedExpected
    Completion(2)

Remaining SpendingCDN Dollars (millions)


2011 Forecast


Total Forecast


Started


(Description)

(after 2011)Allan, Saskatchewan


$
260


$
550



2008


2012 (general expansion)

$
50Cory, Saskatchewan


$
190


$
1,630



2007


2012 (general expansion)

$
50Picadilly, New Brunswick


$
370


$
1,660



2007


2013 (mine shaft and mill)

$
300Rocanville, Saskatchewan


$
750


$
2,800



2008


2014 (mine shaft and mill)

$
1,230    (1)
    The expansion at each of these projects is discussed in the
    technical report for such project filed on SEDAR in accordance
    with National Instrument
    43-101
    Standards of Disclosure for Mineral Projects.(2)
    Excludes
    ramp-up
    time. We expect these projects will be fully ramped up by the
    end of 2015, provided market conditions warrant.    Sources and Uses
    of Cash
    Three Months Ended June 30



Six Months Ended June 30Dollars (millions)


2011


2010


Change


% Change



2011


2010


Change


% ChangeCash provided by operating activities


$
1,064


$
996


$
68



7



$
1,754


$
1,807


$
(53
)


(3
)Cash used in investing activities



(495
)


(535
)


40



(7
)



(936
)


(1,448
)


512



(35
)Cash used in financing activities



(559
)


(393
)


(166
)


42




(822
)


(377
)


(445
)


118      Dollars (millions) 
    except ratio amounts


June 30,
    2011


December 31, 2010


Change


% ChangeCurrent assets


$
2,316


$
2,095


$
221



11Current liabilities


$
(2,462
)

$
(3,144
)

$
682



(22
)Working capital


$
(146
)

$
(1,049
)

$
903



(86
)Current ratio



0.94



0.67



0.27



40        45 PotashCorp
    2011 Second Quarter Quarterly Report on Form 10-Q




---



##### Table of Contents



10-year
    Principal Debt
    Instruments
  June 30, 2011Total


Amount Outstanding


AmountDollars (millions)


Amount


and Committed


AvailableCredit
    facilities(1)


$
3,250


$
1,115


$
2,135Line of credit



75



23
(2)


52    (1)
    
    In March 2011, the company
    established a commercial paper program in the US. The authorized
    amount under the companys commercial paper programs in
    Canada and the US is $1,500 million in the aggregate. The
    amounts available under the commercial paper programs are
    limited to the availability of backup funds under the credit
    facilities. Included in the amount outstanding and committed is
    $1,115 million of commercial paper. Per the terms of the
    agreements, the commercial paper outstanding and committed, as
    applicable under the Canadian program, is based on the US dollar
    balance or equivalent thereof in lawful money of other
    currencies at the time of issue; therefore, subsequent changes
    in the exchange rate applicable to Canadian dollar-denominated
    commercial paper have no impact on this balance.(2)
    
    Letters of credit committed.        same-day
  Long-term Debt

Short-term DebtJun 30,

Dec 31,

Jun 30,

Dec 31,Rating (outlook)


2011

2010

2011

2010Moodys


Baa1 (positive)

Baa1 (positive)

P-2

n/aStandard & Poors


A- (stable)

A- (negative)

A-2(1)

A-2DBRS


n/a

n/a

R1 low

R1 low   (1)
    
    S&P assigned a global
    commercial paper rating of
    A-2, but
    rated our commercial paper
    A-1 (low) on
    a Canadian scale.         PotashCorp 2011 Second Quarter
    Quarterly Report on Form 10-Q  46




---



##### Table of Contents



Outstanding
    Share Data
    Off-Balance
    Sheet Arrangements
  Form 10-Q
  Quarterly
    Financial Highlights
  Dollars (millions) 


June 30,


March 31,



December 31,


September 30,


June 30,


March 31,



December 31,


September 30,except per-share amounts


2011


2011



2010


2010


2010


2010



2009(1)


2009(1)Sales


$
2,325


$
2,204



$
1,813


$
1,575


$
1,437


$
1,714



$
1,099


$
1,099Gross margin



1,168



1,096




826



550



585



729




273



345Net income



840



732




508



343



480



444




239



248Net income per share  basic



0.98



0.86




0.58



0.39



0.54



0.50




0.27



0.28Net income per share  diluted



0.96



0.84




0.56



0.38



0.53



0.49




0.26



0.27    (1)
    
    As we adopted IFRS with effect from
    January 1, 2010, our 2009 quarterly information is
    presented on a Canadian GAAP basis. Accordingly, our quarterly
    information for 2011 and 2010 may not be comparable to that
    for 2009.      Related
    Party Transactions
  Form 10-Q
  Critical
    Accounting Estimates
  Form 10-Q.
  Form 10-Q.
   47 PotashCorp
    2011 Second Quarter Quarterly Report on Form 10-Q




---



##### Table of Contents



Recent
    Accounting Changes
   Form 10-Q
  Form 10-Q.
  Risk
    Management
    and/or
  Form 10-K.
        Outlook
    PotashCorp 2011 Second Quarter
    Quarterly Report on Form 10-Q  48




---



##### Table of Contents



55-60 million
  10-10.5 million
  10-10.5 million
    pent-up
    ramp-up
    49 PotashCorp
    2011 Second Quarter Quarterly Report on Form 10-Q




---



##### Table of Contents



Forward-Looking
    Statements
  Form 10-Q, Form 10-Q, Form 10-K
 
  Item 3. Quantitative
    and Qualitative Disclosures About Market Risk
  Form 10-Q.
 
  Item 4. Controls
    and Procedures
  Securities Exchange Act of 1934
    PotashCorp 2011 Second Quarter
    Quarterly Report on Form 10-Q  50




---



##### Table of Contents



Part II.
    Other Information
  
  Item 1.
    Legal Proceedings
  Form 10-Q.
 
  Item 5.
    Other Information
  Mine Safety
    Practices
      Section 1503
    of Dodd-Frank Wall Street Reform and Consumer Protection Act:
    Reporting Requirements Regarding Coal or Other Mine
    Safety
  ,
  Aurora,


Weeping


WhiteNorth


Water,


Springs,Three Months Ended June 30,
    2011

Carolina


Nebraska


Florida(a)

the total number of alleged violations of mandatory health or
    safety standards that could significantly or substantially
    contribute to the cause and effect of a coal or other mine
    safety or health hazard under Section 104 of the Mine Safety and
    Health Act of 1977 (Act) for which a citation was
    received from the Mine Safety and Health Administration
    (MSHA);


3



1



0(b)

the total number of orders issued under section 104(b) of the
    Act;


0



0



0(c)

the total number of citations received and orders issued under
    section 104(d) of the Act for alleged unwarrantable failures of
    the company to comply with mandatory health or safety standards;


0



0



0(d)

the total number of alleged flagrant violations under section
    110(b)(2) of the Act;


0



0



0(e)

the total number of imminent danger orders issued under section
    107(a) of the Act;


1



0



0(f)

the total dollar value of proposed assessments from the MHSA
    under the Act;

$
13,306


$
2,901
*

$
1,113
**(g)

the total number of mining-related fatalities; and


0



0



0(h)

the total number of legal actions pending before the Federal
    Mine Safety and Health Review Commission as of June 30, 2011.


1



1



0         *
    
    The company has challenged this
    assessment in a legal action pending before the Federal Mine
    Safety and Health Review Commission.**
    
    In the second quarter, two
    citations at White Springs were settled for $1,743.  51 PotashCorp
    2011 Second Quarter Quarterly Report on Form 10-Q




---



##### Table of Contents



Item 6.
    Exhibits
  (a)
    Exhibits Incorporated by ReferenceExhibit






Filing Date/Period

Exhibit NumberNumber

Description of Document


Form

End Date

(if different)3(a)

Articles of Continuance of the registrant dated May 15,
    2002.



10-Q



6/30/20023(b)

Bylaws of the registrant effective May 15, 2002.



10-Q



6/30/20024(a)

Term Credit Agreement between The Bank of Nova Scotia and other
    financial institutions and the registrant dated
    September 25, 2001.



10-Q



9/30/20014(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.



10-Q



9/30/20034(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.



8-K



9/24/20044(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.



8-K



9/22/2005



4
(a)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.



10-Q



9/30/20064(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.



8-K



10/22/2007



4
(a)4(g)

Indenture dated as of February 27, 2003, between the
    registrant and The Bank of Nova Scotia Trust Company of New
    York.



10-K



12/31/2002



4
(c)4(h)

Form of Note relating to the registrants offering of
    $250,000,000 principal amount of 4.875% Notes due
    March 1, 2013.



8-K



2/28/2003



44(i)

Form of Note relating to the registrants offering of
    $500,000,000 principal amount of 5.875% Notes due
    December 1, 2036.



8-K



11/30/2006



4
(a)4(j)

Form of Note relating to the registrants offering of
    $500,000,000 principal amount of 5.25% Notes due
    May 15, 2014.



8-K



5/1/2009



4
(a)4(k)

Form of Note relating to the registrants offering of
    $500,000,000 principal amount of 6.50% Notes due
    May 15, 2019.



8-K



5/1/2009



4
(b)4(l)

Form of Note relating to the registrants offering of
    $500,000,000 principal amount of 3.75% Notes due
    September 30, 2015.



8-K



9/25/2009



4
(a)4(m)

Form of Note relating to the registrants offering of
    $500,000,000 principal amount of 4.875% Notes due
    March 30, 2020.



8-K



9/25/2009



4
(b)4(n)

Revolving Term Credit Facility Agreement between the Bank of
    Nova Scotia and other financial institutions and the registrant
    dated December 11, 2009.



8-K



12/15/2009



4
(a)4(o)

Form of Note relating to the registrants offering of
    $500,000,000 principal amount of 3.25% Notes due
    December 1, 2017.



8-K



11/29/2010



4
(a)4(p)

Form of Note relating to the registrants offering of
    $500,000,000 principal amount of 5.625% Notes due
    December 1, 2040.



8-K



11/29/2010



4
(b)      PotashCorp 2011 Second Quarter
    Quarterly Report on Form 10-Q  52




---



##### Table of Contents



Incorporated By ReferenceExhibit






Filing Date/Period

Exhibit NumberNumber

Description of Document


Form

End Date

(if different)10(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.


F-1
    (File No.
    33-31303)


9/28/1989



10(f
)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.


F-1
    (File No.
    33-31303)


9/28/1989



10(g
)10(c)

Producer Agreement dated April 21, 1978, between Canpotex
    Limited and PCS Sales.


F-1
    (File No.
    33-31303)


9/28/1989



10(h
)10(d)

Canpotex/PCS Amending Agreement, dated as of October 1,
    1992.


10-K


12/31/1995



10(f
)10(e)

Canpotex PCA Collateral Withdrawing/PCS Amending Agreement,
    dated as of October 7, 1993.


10-K


12/31/1995



10(g
)10(f)

Canpotex Producer Agreement amending agreement dated as of
    July 1, 2002.


10-Q


6/30/2004



10(g
)10(g)

Esterhazy Restated Mining and Processing Agreement dated
    January 31, 1978, between International
    Minerals & Chemical Corporation (Canada) Limited and
    the registrants predecessor.


F-1
    (File No.
    33-31303)


9/28/1989



10(e
)10(h)

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.


10-K


12/31/1990



10(p
)10(i)

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).


10-K


12/31/1998



10(l
)10(j)

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.


10-K


12/31/1998



10(m
)10(k)

Potash Corporation of Saskatchewan Inc. Stock Option
    Plan  Directors, as amended.


10-K


12/31/2006



10(l
)10(l)

Potash Corporation of Saskatchewan Inc. Stock Option
    Plan  Officers and Employees, as amended.


10-K


12/31/2006



10(m
)10(m)

Short-Term Incentive Plan of the registrant effective
    January 1, 2000, as amended.


10-Q


9/30/200910(n)

Resolution and Forms of Agreement for Supplemental Executive
    Retirement Income Plan, for officers and key employees of the
    registrant.


10-K


12/31/1995



10(o
)10(o)

Amending Resolution and revised forms of agreement regarding
    Supplemental Retirement Income Plan of the registrant.


10-Q


6/30/1996



10(x
)10(p)

Amended and restated Supplemental Executive Retirement Income
    Plan of the registrant and text of amendment to existing
    supplemental income plan agreements.


10-Q


9/30/2000



10(mm
)10(q)

Amendment, dated February 23, 2009, to the amended and
    restated Supplemental Executive Retirement Income Plan.


10-K


12/31/2008



10(r
)  53 PotashCorp
    2011 Second Quarter Quarterly Report on Form 10-Q




---



##### Table of Contents



Incorporated By ReferenceExhibit






Filing Date/Period

Exhibit NumberNumber

Description of Document


Form

End Date

(if different)10(r)

Amendment, dated December 29, 2010, to the amended and
    restated Supplemental Executive Retirement Income Plan.


10-K


12/31/201010(s)

Form of Letter of amendment to existing supplemental income plan
    agreements of the registrant.


10-K


12/31/2002



10(cc
)10(t)

Amended and restated agreement dated February 20, 2007,
    between the registrant and William J. Doyle concerning the
    Supplemental Executive Retirement Income Plan.


10-K


12/31/2006



10(s
)10(u)

Amendment, dated December 24, 2008, to the amended and
    restated agreement, dated February 20, 2007, between the
    registrant and William J. Doyle concerning the Supplemental
    Executive Retirement Income Plan.


10-K


12/31/200810(v)

Amendment, dated February 23, 2009, to the amended and
    restated agreement, dated February 20, 2007, between the
    registrant and William J. Doyle concerning the Supplemental
    Executive Retirement Income Plan.


10-K


12/31/200810(w)

Amendment, dated February 23, 2009, to the amended and
    restated agreement dated August 2, 1996, between the
    registrant and Wayne R. Brownlee concerning the Supplemental
    Executive Retirement Income Plan.


10-K


12/31/200810(x)

Amendment, dated February 23, 2009, to the amended and
    restated agreement, dated August 2, 1996, between the
    registrant and Garth W. Moore concerning the Supplemental
    Executive Retirement Income Plan.


10-K


12/31/200810(y)

Amendment, dated December 29, 2010, to the amended and
    restated agreement, dated February 20, 2007, between the
    registrant and William J. Doyle concerning the Supplemental
    Executive Retirement Income Plan.


10-K


12/31/201010(z)

Amendment, dated December 29, 2010, to the amended and
    restated agreement, dated August 2, 1996, between the
    registrant and Wayne R. Brownlee concerning the Supplemental
    Executive Retirement Income Plan.


10-K


12/31/201010(aa)

Amendment, dated December 29, 2010, to the amended and
    restated agreement, dated August 2, 1996, between the
    registrant and Garth W. Moore concerning the Supplemental
    Executive Retirement Income Plan.


10-K


12/31/201010(bb)

Supplemental Retirement Benefits Plan for U.S. Executives dated
    effective January 1, 1999.


10-Q


6/30/2002



10(aa
)10(cc)

Amendment No. 1, dated December 24, 2008, to the
    Supplemental Retirement Plan for U.S. Executives.


10-K


12/31/2008



10(z
)10(dd)

Amendment No. 2, dated February 23, 2009, to the
    Supplemental Retirement Plan for U.S. Executives.


10-K


12/31/2008



10(aa
)10(ee)

Forms of Agreement dated December 30, 1994, between the
    registrant and certain officers of the registrant.


10-K


12/31/1995



10(p
)10(ff)

Amendment, dated December 31, 2010, to the Agreement, dated
    December 30, 1994 between the registrant and William J.
    Doyle.


10-K


12/31/201010(gg)

Form of Agreement of Indemnification dated August 8, 1995,
    between the registrant and certain officers and directors of the
    registrant.


10-K


12/31/1995



10(q
)10(hh)

Resolution and Form of Agreement of Indemnification dated
    January 24, 2001.


10-K


12/31/2000



10(ii
)10(ii)

Resolution and Form of Agreement of Indemnification
     July 21, 2004.


10-Q


6/30/200410(jj)

Chief Executive Officer Medical and Dental Benefits.


10-K


12/31/201010(kk)

Deferred Share Unit Plan for Non-Employee Directors, as amended.


10-Q


3/31/2008



10(bb
)10(ll)

U.S. Participant Addendum No. 1 to the Deferred Share Unit
    Plan for Non-Employee Directors.


10-K


12/31/2008



10(jj
)  PotashCorp 2011 Second Quarter
    Quarterly Report on Form 10-Q  54




---



##### Table of Contents



Incorporated By ReferenceExhibit






Filing Date/Period

Exhibit NumberNumber

Description of Document


Form

End Date

(if different)10(mm)

Potash Corporation of Saskatchewan Inc. 2005 Performance Option
    Plan and Form of Option Agreement, as amended.


10-K


12/31/2006



10(cc
)10(nn)

Potash Corporation of Saskatchewan Inc. 2006 Performance Option
    Plan and Form of Option Agreement, as amended.


10-K


12/31/2006



10(dd
)10(oo)

Potash Corporation of Saskatchewan Inc. 2007 Performance Option
    Plan and Form of Option Agreement.


10-Q


3/31/2007



10(ee
)10(pp)

Potash Corporation of Saskatchewan Inc. 2008 Performance Option
    Plan and Form of Option Agreement.


10-Q


3/31/2008



10(ff
)10(qq)

Potash Corporation of Saskatchewan Inc. 2009 Performance Option
    Plan and Form of Option Agreement.


10-Q


3/31/2009



10(mm
)10(rr)

Potash Corporation of Saskatchewan Inc. 2010 Performance Option
    Plan and Form of Option Agreement.


8-K


5/7/2010



10.110(ss)

Potash Corporation of Saskatchewan Inc. 2011 Performance Option
    Plan and Form of Option Agreement.


8-K


5/13/2011



10(a
)10(tt)

Medium-Term Incentive Plan of the registrant effective
    January 1, 2009.


10-K


12/31/2008



10(qq
)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.   55 PotashCorp
    2011 Second Quarter Quarterly Report on Form 10-Q




---



##### Table of Contents



Signatures
        August 5, 2011
  By:
    /s/  JOSEPH
    PODWIKA   Senior Vice President, General Counsel and Secretary
   August 5, 2011
  By:
    /s/  WAYNE
    R. BROWNLEE   Executive Vice President, Treasurer and
 Chief Financial Officer
 (Principal Financial and Accounting Officer)
  PotashCorp 2011 Second Quarter
    Quarterly Report on Form 10-Q  56




---



##### Table of Contents



EXHIBIT INDEX
  Incorporated by ReferenceExhibit






Filing Date/Period

Exhibit NumberNumber

Description of Document


Form

End Date

(if different)3(a)

Articles of Continuance of the registrant dated May 15,
    2002.



10-Q



6/30/20023(b)

Bylaws of the registrant effective May 15, 2002.



10-Q



6/30/20024(a)

Term Credit Agreement between The Bank of Nova Scotia and other
    financial institutions and the registrant dated
    September 25, 2001.



10-Q



9/30/20014(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.



10-Q



9/30/20034(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.



8-K



9/24/20044(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.



8-K



9/22/2005



4
(a)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.



10-Q



9/30/20064(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.



8-K



10/22/2007



4
(a)4(g)

Indenture dated as of February 27, 2003, between the
    registrant and The Bank of Nova Scotia Trust Company of New
    York.



10-K



12/31/2002



4
(c)4(h)

Form of Note relating to the registrants offering of
    $250,000,000 principal amount of 4.875% Notes due
    March 1, 2013.



8-K



2/28/2003



44(i)

Form of Note relating to the registrants offering of
    $500,000,000 principal amount of 5.875% Notes due
    December 1, 2036.



8-K



11/30/2006



4
(a)4(j)

Form of Note relating to the registrants offering of
    $500,000,000 principal amount of 5.25% Notes due
    May 15, 2014.



8-K



5/1/2009



4
(a)4(k)

Form of Note relating to the registrants offering of
    $500,000,000 principal amount of 6.50% Notes due
    May 15, 2019.



8-K



5/1/2009



4
(b)4(l)

Form of Note relating to the registrants offering of
    $500,000,000 principal amount of 3.75% Notes due
    September 30, 2015.



8-K



9/25/2009



4
(a)4(m)

Form of Note relating to the registrants offering of
    $500,000,000 principal amount of 4.875% Notes due
    March 30, 2020.



8-K



9/25/2009



4
(b)4(n)

Revolving Term Credit Facility Agreement between the Bank of
    Nova Scotia and other financial institutions and the registrant
    dated December 11, 2009.



8-K



12/15/2009



4
(a)4(o)

Form of Note relating to the registrants offering of
    $500,000,000 principal amount of 3.25% Notes due
    December 1, 2017.



8-K



11/29/2010



4
(a)4(p)

Form of Note relating to the registrants offering of
    $500,000,000 principal amount of 5.625% Notes due
    December 1, 2040.



8-K



11/29/2010



4
(b)




---



##### Table of Contents



Incorporated By ReferenceExhibit






Filing Date/Period

Exhibit NumberNumber

Description of Document


Form

End Date

(if different)10(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.


F-1
    (File No.
    33-31303)


9/28/1989



10(f
)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.


F-1
    (File No.
    33-31303)


9/28/1989



10(g
)10(c)

Producer Agreement dated April 21, 1978, between Canpotex
    Limited and PCS Sales.


F-1
    (File No.
    33-31303)


9/28/1989



10(h
)10(d)

Canpotex/PCS Amending Agreement, dated as of October 1,
    1992.


10-K


12/31/1995



10(f
)10(e)

Canpotex PCA Collateral Withdrawing/PCS Amending Agreement,
    dated as of October 7, 1993.


10-K


12/31/1995



10(g
)10(f)

Canpotex Producer Agreement amending agreement dated as of
    July 1, 2002.


10-Q


6/30/2004



10(g
)10(g)

Esterhazy Restated Mining and Processing Agreement dated
    January 31, 1978, between International
    Minerals & Chemical Corporation (Canada) Limited and
    the registrants predecessor.


F-1
    (File No.
    33-31303)


9/28/1989



10(e
)10(h)

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.


10-K


12/31/1990



10(p
)10(i)

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).


10-K


12/31/1998



10(l
)10(j)

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.


10-K


12/31/1998



10(m
)10(k)

Potash Corporation of Saskatchewan Inc. Stock Option
    Plan  Directors, as amended.


10-K


12/31/2006



10(l
)10(l)

Potash Corporation of Saskatchewan Inc. Stock Option
    Plan  Officers and Employees, as amended.


10-K


12/31/2006



10(m
)10(m)

Short-Term Incentive Plan of the registrant effective
    January 1, 2000, as amended.


10-Q


9/30/200910(n)

Resolution and Forms of Agreement for Supplemental Executive
    Retirement Income Plan, for officers and key employees of the
    registrant.


10-K


12/31/1995



10(o
)10(o)

Amending Resolution and revised forms of agreement regarding
    Supplemental Retirement Income Plan of the registrant.


10-Q


6/30/1996



10(x
)10(p)

Amended and restated Supplemental Executive Retirement Income
    Plan of the registrant and text of amendment to existing
    supplemental income plan agreements.


10-Q


9/30/2000



10(mm
)10(q)

Amendment, dated February 23, 2009, to the amended and
    restated Supplemental Executive Retirement Income Plan.


10-K


12/31/2008



10(r
)




---



##### Table of Contents



Incorporated By ReferenceExhibit






Filing Date/Period

Exhibit NumberNumber

Description of Document


Form

End Date

(if different)10(r)

Amendment, dated December 29, 2010, to the amended and
    restated Supplemental Executive Retirement Income Plan.


10-K


12/31/201010(s)

Form of Letter of amendment to existing supplemental income plan
    agreements of the registrant.


10-K


12/31/2002



10(cc
)10(t)

Amended and restated agreement dated February 20, 2007,
    between the registrant and William J. Doyle concerning the
    Supplemental Executive Retirement Income Plan.


10-K


12/31/2006



10(s
)10(u)

Amendment, dated December 24, 2008, to the amended and
    restated agreement, dated February 20, 2007, between the
    registrant and William J. Doyle concerning the Supplemental
    Executive Retirement Income Plan.


10-K


12/31/200810(v)

Amendment, dated February 23, 2009, to the amended and
    restated agreement, dated February 20, 2007, between the
    registrant and William J. Doyle concerning the Supplemental
    Executive Retirement Income Plan.


10-K


12/31/200810(w)

Amendment, dated February 23, 2009, to the amended and
    restated agreement dated August 2, 1996, between the
    registrant and Wayne R. Brownlee concerning the Supplemental
    Executive Retirement Income Plan.


10-K


12/31/200810(x)

Amendment, dated February 23, 2009, to the amended and
    restated agreement, dated August 2, 1996, between the
    registrant and Garth W. Moore concerning the Supplemental
    Executive Retirement Income Plan.


10-K


12/31/200810(y)

Amendment, dated December 29, 2010, to the amended and
    restated agreement, dated February 20, 2007, between the
    registrant and William J. Doyle concerning the Supplemental
    Executive Retirement Income Plan.


10-K


12/31/201010(z)

Amendment, dated December 29, 2010, to the amended and
    restated agreement, dated August 2, 1996, between the
    registrant and Wayne R. Brownlee concerning the Supplemental
    Executive Retirement Income Plan.


10-K


12/31/201010(aa)

Amendment, dated December 29, 2010, to the amended and
    restated agreement, dated August 2, 1996, between the
    registrant and Garth W. Moore concerning the Supplemental
    Executive Retirement Income Plan.


10-K


12/31/201010(bb)

Supplemental Retirement Benefits Plan for U.S. Executives dated
    effective January 1, 1999.


10-Q


6/30/2002



10(aa
)10(cc)

Amendment No. 1, dated December 24, 2008, to the
    Supplemental Retirement Plan for U.S. Executives.


10-K


12/31/2008



10(z
)10(dd)

Amendment No. 2, dated February 23, 2009, to the
    Supplemental Retirement Plan for U.S. Executives.


10-K


12/31/2008



10(aa
)10(ee)

Forms of Agreement dated December 30, 1994, between the
    registrant and certain officers of the registrant.


10-K


12/31/1995



10(p
)10(ff)

Amendment, dated December 31, 2010, to the Agreement, dated
    December 30, 1994 between the registrant and William J.
    Doyle.


10-K


12/31/201010(gg)

Form of Agreement of Indemnification dated August 8, 1995,
    between the registrant and certain officers and directors of the
    registrant.


10-K


12/31/1995



10(q
)10(hh)

Resolution and Form of Agreement of Indemnification dated
    January 24, 2001.


10-K


12/31/2000



10(ii
)10(ii)

Resolution and Form of Agreement of Indemnification
     July 21, 2004.


10-Q


6/30/200410(jj)

Chief Executive Officer Medical and Dental Benefits.


10-K


12/31/201010(kk)

Deferred Share Unit Plan for Non-Employee Directors, as amended.


10-Q


3/31/2008



10(bb
)10(ll)

U.S. Participant Addendum No. 1 to the Deferred Share Unit
    Plan for Non-Employee Directors.


10-K


12/31/2008



10(jj
)




---



##### Table of Contents



Incorporated By ReferenceExhibit






Filing Date/Period

Exhibit NumberNumber

Description of Document


Form

End Date

(if different)10(mm)

Potash Corporation of Saskatchewan Inc. 2005 Performance Option
    Plan and Form of Option Agreement, as amended.


10-K


12/31/2006



10(cc
)10(nn)

Potash Corporation of Saskatchewan Inc. 2006 Performance Option
    Plan and Form of Option Agreement, as amended.


10-K


12/31/2006



10(dd
)10(oo)

Potash Corporation of Saskatchewan Inc. 2007 Performance Option
    Plan and Form of Option Agreement.


10-Q


3/31/2007



10(ee
)10(pp)

Potash Corporation of Saskatchewan Inc. 2008 Performance Option
    Plan and Form of Option Agreement.


10-Q


3/31/2008



10(ff
)10(qq)

Potash Corporation of Saskatchewan Inc. 2009 Performance Option
    Plan and Form of Option Agreement.


10-Q


3/31/2009



10(mm
)10(rr)

Potash Corporation of Saskatchewan Inc. 2010 Performance Option
    Plan and Form of Option Agreement.


8-K


5/7/2010



10.110(ss)

Potash Corporation of Saskatchewan Inc. 2011 Performance Option
    Plan and Form of Option Agreement.


8-K


5/13/2011



10(a
)10(tt)

Medium-Term Incentive Plan of the registrant effective
    January 1, 2009.


10-K


12/31/2008



10(qq
)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.