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Exhibit 99(b)




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(PICTURE)
  ABOUT POTASHCORP
    Our Goal
Our goal is to be the partner of choice,
providing superior value to all our
stakeholders. We strive to be the
highest quality low-cost producer and
sustainable gross margin leader in the
products we sell and the markets we
serve.
We link our financial performance with
areas of extended responsibility that
include safety, the environment and all
those who have a social or economic
interest in our business.
Our Strategy
Committed to seeking earnings growth and
to minimizing volatility, we employ a
Potash First strategy, focusing our
capital  internally and through
investments  to build on our unmatched
potash assets and meet the growing
global demand for this vital nutrient.
By investing in potash capacity while
producing to meet market demand, we
create the opportunity for significant
growth while limiting downside risk.
We complement our potash operations with
focused nitrogen and phosphate businesses
that emphasize the production of
high-margin products with stable and
sustainable earnings potential.




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##### 



(BACKGROUND)
 BUILDING A PLATFORM FOR LONG-TERM GROWTH
  1
    
    Unparalleled potash position
With unrivaled potash resources and the majority of the worlds excess capacity, we have the
unique ability to increase production to quickly and cost-effectively meet rising demand.2
    
    Access to key global markets
With large low-cost potash operations in Canada, an extensive global distribution network
and strategic investments in Jordan, Israel, Chile and China, we benefit from growth in
all key world markets.3
    
    Targeted strengths in nitrogen and phosphate
Long-term, lower-cost natural gas contracts in Trinidad and geographic proximity provide unique
advantages in serving the US, the worlds largest nitrogen importer. Superior-quality phosphate
rock enables us to produce higher-margin feed and industrial products, including purified acid.4
    
    Clear vision and skilled management
Our management teams ability to develop and execute focused, long-term strategies 
proven in changing market conditions over nearly two decades  helps us capitalize on our
unique strengths.5
    
    Commitment to sustainability and core values
We promote the long-term viability and value of our company by monitoring our economic,
environmental and social performance, and by living by our core values of safety, integrity,
listening, sharing, accountability and continuous improvement.6
    
    Strong cash flow
Our strong cash flow enables us to grow our business, choosing from options that
include bringing back idled capacity, plant expansions and extending our global enterprise
via investments.7
    
    High-quality earnings
Our emphasis on potash, Trinidad nitrogen and industrial phosphates  almost 80 percent
of our gross margin  delivers earnings growth with less dependence on volatile
agricultural cycles.
  
 UNLOCK MORE WITH KEYWORDS
 The
»  symbol indicates that
more informationis available online at www.PotashCorp2006AR.com
 All financial data in this report are stated in US dollars.
 CONTENTS
 Overview
    
    
    2Letter to Shareholders
    
    
    6Business Environment
    
    
    10Sustainability
    
    
    24Financial Overview
    
    
    28Board and Senior Management
    
    
    34Shareholder Information
    
    
    36Glossary
    
    
    38




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2 OVERVIEW / POTASHCORP 2006 SUMMARY ANNUAL REPORT
  WHY POTASH?
  █ Demand for potash is increasing
 
    
    Growing offshore economies are improving diets.
    
    Rising global populations and expanding urbanization are shrinking the per-capita
agricultural land base.
    
    The need for alternative energy sources is creating new markets for crops.
 █ Potash supply is tightening
 
    
    Most producers are operating at or near capacity.
 █ Crop prices are rising, encouraging maximum production
 
    
    Prices for corn, wheat and other crops are reaching levels not experienced in the past
decade.
 █ The environment is favorable
 
    
    The potash industry has relatively few competitors, minimal government involvement and high
barriers to entry.
    
    Significant new competitive production appears unlikely in the next five years due to the rarity
of deposits and the high cost and long lead time to develop a greenfield mine.
 (PICTURE)
    
    (PICTURE)
    
    (PICTURE)POTASH
    
    NITROGEN
    
    PHOSPHATEFertilizer
    
    Fertilizer
    
    Fertilizer  strengthens plant roots and improves water retention, contributing to greater yields and disease resistance
    
      a building block for proteins and enzymes; speeds growth and improves yield and quality
    
      critical to energy reactions in plants; speeds maturity and reproduction and increases yieldsFeed supplements
    
    Feed supplements
    
    Feed supplements  aids animal growth and milk production
    
      essential to RNA, DNA and cell maturation
    
      energizes animal muscles; aids growthIndustrial
    
    Industrial
    
    Industrial  used in TV screens, soaps and de-icers
    
      used in plastics, resins and adhesives
    
      used in soft drinks, food and metal treatment
 Our Business Segments
  WORLD POSITION BY CAPACITY
 COMPETITIVE STRENGTHS
 STRATEGIES
 Facilities, Investments and Key Markets
  FACILITIES
 K POTASH
    
    N NITROGEN1 Allan SK
    
    1 Augusta GA2 Cory SK
    
    2 Geismar LA3 Esterhazy SK1
    
    3 Lima OH4 Lanigan SK
    
    4 Point Lisas, Trinidad5 Patience Lake SK6 Rocanville SK7 Sussex NB
  inv INVESTMENTS
 1
 2
 3
 4




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POTASHCORP 2006 SUMMARY ANNUAL REPORT / OVERVIEW 3
 POTASH
    
    NITROGEN
    
    PHOSPHATE13.5 million
    
    58%
    
    27%Tonnes of potash capacity
by the end of 2010
    
    Percentage of nitrogen
gross margin from Trinidad
    
    Increase in phosphate
gross margin year-over-year1st
    
    4th
    
    3rd   Low-cost producer with 22 percent
of world capacity and majority
of world excess capacity
   Access to key markets through
Canadian operations, a global
distribution network and strategic
offshore investments
   High barriers to entry
    
       Majority of ammonia produced in
Trinidad with long-term access to lower-cost natural gas
   Proximity of Trinidad production to the US,
the worlds largest nitrogen importer
   US-produced ammonia sold primarily
to stable industrial customer base
    
       Unique, high-quality phosphate
rock can be processed into diversified higher-margin products
   Long-term competitive cost advantage for
phosphate rock in North America given proximity of
mines to processing facilities
   Significant reserves   Use low-cost excess capacity to
respond to growing world demand
   Produce only what the market needs
   Seek internal and global opportunities
to add low-cost, high-quality capacity
    
       Maximize Trinidad ammonia production
under existing natural gas contracts
   Focus on less-cyclical industrial
products at US-based plants
    
       Maximize benefits of superior rock to
produce diverse phosphate products that are less
cyclical and more profitable
  
 1




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4
    
    OVERVIEW / POTASHCORP 2006 SUMMARY ANNUAL REPORT
 2006 KEY FIGURES
 $632 million
    
    $941 million
    
    20%2006 Earnings
(third consecutive record year)
    
    2006 Cash flow
prior to working capital changes1
    
    5 Year EBITDA1CAGR2
  2006 Financial Highlights
 
    
    Delivered earnings of $632 million  a record for the third straight year  even as annual
potash shipments to China and India declined by 40 percent because of extended price
negotiations
    
    Achieved record cash flow prior to working capital changes1of $941 million
    
    Realized a year-over-year share price increase of 79 percent, and a 368-percent increase
since the beginning of 2002
    
    Reached potash gross margin of $561 million, second only to the 2005 record of $707 million
    
    Generated more than $300 million in nitrogen gross margin for a second straight year
    
    Increased phosphate gross margin 27 percent year-over-year despite a reduction in solid
fertilizer margins
 2006 Operating Highlights
 
    
    Advanced projects to bring back 400,000 tonnes of idled potash capacity at Allan in 2007 and
1.5 million tonnes at Lanigan in 2008
    
    Concluded a two-year, 294,000-tonne expansion of ammonia
capacity at Trinidad and an expansion of 82,000 tonnes P2O5
in purified acid capacity at Aurora
    
    Purchased an additional 10 percent of Sinofert, bringing our ownership in Chinas largest
fertilizer importer and distributor to 20 percent
    
    Acquired additional interest in SQM in Chile, a producer of specialty fertilizers, and APC in
Jordan, one of the two lowest-cost potash suppliers to Mediterranean and Asian markets
    
    Received recognition as Canadas best corporate reporter, earning the Overall Award of
Excellence in Corporate Reporting from the Canadian Institute of Chartered Accountants for an
unprecedented third consecutive year
   NET INCOME(BAR CHART)
    
    GROSS MARGIN(BAR CHART)
    
    EBITDA1(BAR CHART)
    
    CASH FLOW
RETURN 1(BAR CHART)Despite constrained potash
shipments for seven months of 2006, we achieved our highest
net income ever and earned a
record $5.95 per share (diluted).
    
    Record second-half potash sales
and strong contributions from
nitrogen and phosphate produced the
second highest gross margin in
our history.
    
    2006 EBITDA was consistent with
record 2005 despite a temporary
disruption in potash demand,
verifying the effectiveness of
our business strategy.
    
    An indicator of shareholder value
created, our cash flow return
exceeded weighted average cost of
capital by more than 5 percent.




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POTASHCORP 2006 SUMMARY ANNUAL REPORT / OVERVIEW 5
 $15
billion
    
    $2.8 billion
    
    79%Total market capitalization
at year-end
    
    Market value of
equity investments
(book value of $1.1 billion)
    
    Share price increase
year-over-year
 2006 Financial Highlights
 ($ millions, except per-share data and percentages)
    

2006
    
    
    Change
    
    2005
    
    
    Change
    
    2004
    
    
    5-Year
    
    10-YearYOY3
    
    
    
    
    YOY3
    
    
    
    
    CAGR2
    
    CAGR2Financial ResultsSales
    
    $
    3,766.7
    
    
    
    -2
    %
    
    $
    3,847.2
    
    
    
    19
    %
    
    $
    3,244.4
    
    
    
    10
    %
    
    
    9
    %Net sales1
    
    $
    3,376.8
    
    
    
    -3
    %
    
    $
    3,475.6
    
    
    
    20
    %
    
    $
    2,901.4
    
    
    
    10
    %
    
    
    9
    %Gross margin
    
    $
    1,002.0
    
    
    
    -11
    %
    
    $
    1,125.0
    
    
    
    65
    %
    
    $
    681.4
    
    
    
    20
    %
    
    
    10
    %Net income
    
    $
    631.8
    
    
    
    16
    %
    
    $
    542.9
    
    
    
    82
    %
    
    $
    298.6
    
    
    
    39
    %
    
    
    12
    %Net income per share  diluted
    
    $
    5.95
    
    
    
    22
    %
    
    $
    4.89
    
    
    
    81
    %
    
    $
    2.70
    
    
    
    39
    %
    
    
    10
    %EBITDA1
    
    $
    1,117.9
    
    
    
    -2
    %
    
    $
    1,135.0
    
    
    
    50
    %
    
    $
    754.3
    
    
    
    20
    %
    
    
    11
    %Additions to
property, plant and
equipment
    
    $
    508.6
    
    
    
    33
    %
    
    $
    382.7
    
    
    
    74
    %
    
    $
    220.5Dividends per share
    
    $
    0.60
    
    
    
    
    
    
    $
    0.60
    
    
    
    9
    %
    
    $
    0.55Financial PositionTotal Assets
    
    $
    6,217.0
    
    
    
    16
    %
    
    $
    5,357.9
    
    
    
    5
    %
    
    $
    5,126.8Net debt1
    
    $
    1,589.7
    
    
    
    12
    %
    
    $
    1,417.1
    
    
    
    57
    %
    
    $
    903.5Cash flow prior to
working capital
changes1
    
    $
    940.8
    
    
    
    9
    %
    
    $
    860.3
    
    
    
    60
    %
    
    $
    538.3Cash provided by
operating activities
    
    $
    696.8
    
    
    
    -19
    %
    
    $
    865.1
    
    
    
    31
    %
    
    $
    658.3
 1
    
    See reconciliation and description of certain non-GAAP measures on Page 332
    
    Compound annual growth rate expressed as a percentage3
    
    Year-over-year
 For
a complete list of financialperformance indicators, see our online
Annual Report, Keyword »




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6
    

LETTER
TO SHAREHOLDERS / POTASHCORP 2006 SUMMARY ANNUAL REPORT
   LETTER TO SHAREHOLDERS
 
 In 2006, PotashCorp achieved record earnings despite disruptions in potash demand.This provided an opportunity to demonstrate our ability to deliver growth with reduced volatility.We entered 2007 with the factors that drive our success aligned better than ever before.
 William J. Doyle President and Chief Executive Officer
       
    
    growth in offshore economies where people have higher
expectations for better diets;
    
    rising world population (primarily in
these offshore markets) and a limited agricultural land base, making
fertilizer use more important to farmers working to increase yields and
improve food quality;
    
    a quest for alternative energy sources, such as
ethanol and biodiesel, that is creating a growing market for key crops;
    
    historically low global grain inventories; and
    
    strong farm
economics, including higher prices for many crop commodities, that
encourage farmers to maximize production.




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POTASHCORP 2006 SUMMARY ANNUAL REPORT / LETTER TO SHAREHOLDERS 7
  Growing Markets for Food, Feed, Fuel and Fiber
       Meeting Growing Potash Demand
 Growing global demand for food and biofuels is adding to the pressure on farmers to grow more
grain, driving up the need for fertilizers.
 Potash demand is expected to grow 10 percent in 2007 and 3-4 percent per year through 2011.
 PotashCorp can bring back unused capacity more quickly and at a lower cost than greenfield
production.
 Greater volumes, lower costs and higher prices give us triple leverage in potash.




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8 LETTER TO SHAREHOLDERS / POTASHCORP 2006 SUMMARY ANNUAL REPORT
  Nitrogen and phosphate generated record combined gross margin in 2006.Strategic offshore investments extend our global potash enterprise.
 Playing to Our Strengths
   2 5
 Broadening Our Global Reach
    █ Increasing Capacity to Meet Long-Term Potash Demand Growth




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POTASHCORP 2006 SUMMARY ANNUAL REPORT / LETTER TO SHAREHOLDERS 9
  Performing at All Levels
      Built for Long-Term Success
        
 William
J. Doyle, President and Chief Executive OfficerFebruary 20, 2007
 Our financial success is tied to our commitment to all stakeholder groups.
 We report on our performance in all areas of our business.
 For almost two decades, weve been preparing for the conditions we see today.
 By enriching the land and the food grown on it, we will enrich our shareholders.




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10
    
    BUSINESS ENVIRONMENT / POTASHCORP 2006 SUMMARY ANNUAL REPORT
  BUSINESS ENVIRONMENT
  With more people to feed, the worlds farmers must produce more food.Our products help farmers increase yields by replenishing essential nutrients in their soil.
 Six Keys to Understanding Our Business
 1
    
    The world needs more fertilizer2
    
    Potash is the core of our business3
    
    Our strategies emphasize earnings growth and quality4
    
    We are uniquely prepared to meet growing potash demand5
    
    The factors that drive our success are aligning6
    
    We are transparent and accountable
 For a complete analysis of our businessenvironment, see our online AnnualReport, Keyword »
    (BUSINESS)
   
  Offshore Markets Are DrivingRising Demand for Food
  World Population Rising
 Offshore Economies Growing
 Fertilizer Application RatesAre Growing
  Fertilizer Growth Potential
 
 China and India could achieve recommended nutrient levels by each applying about 30 million more
tonnes of KCl, N and P 2 O 5 annually. Soybeans, Brazils major crop, draw
nitrogen from the air but are hungry for potash.




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Production of Biofuels Is Increasing
 Biofuels Creating New Demand
 Global Potash Supply Is Tightening
   Global Grain Stocks Falling
 Wheat and Coarse Grains
 
 More grain has been consumed than
produced in most recent years, reducing
the stocks-to-use ratio to the lowest
level ever recorded.
 Crop Prices Are Rising
  Higher Crop Prices




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12 BUSINESS ENVIRONMENT / POTASHCORP 2006 SUMMARY ANNUAL REPORT
 
  PotashCorp Gross Margin by Nutrient  2006
 Potash First Maximizes
Growth Potential and Gross Margin
 Largest Potash Company  2006
 
   █
 █
 █
 █
   
 Nitrogen and Phosphate Provide Balance and Stability
   Trinidad Advantage in Nitrogen
 Stability and Diversity in Phosphate




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POTASHCORP 2006 SUMMARY ANNUAL REPORT / BUSINESS ENVIRONMENT 13
 
  Peers in Our Industry
 
   Peer
Performance Summary
 
  Comparability of Peer Information
 Sources:
 1
    
    Capital expenditures = additions to property, plant and equipment2
    
    Year ended December 31, 20063
    
    Last four quarters ended November 30, 20064
    
    Last four quarters ended September 30, 20065
    
    Mosaics last four-quarter net income
includes $287.6 million (pre-tax) and $285.6
million (after-tax), respectively, in phosphate
division writedowns.6
    
    Agriums year-ended December 31, 2006
net income includes $136.0 million (pre-tax) and
$95.0 million (after-tax), respectively, in
phosphate division writedowns. As Agriums
year-ended December 31, 2006 statement of cash
flows was not provided by time of print, last
four quarters ended September 30, 2006 were used
in determining cash flow from operations and
capital expenditures.7
    
    Yara net income, cash flow from operations
and capital expenditures translated at 1 USD = NOK
6.3826, average exchange rate for 2006 as provided
from company reports.8
    
    K+S net income, cash flow from operations
and capital expenditures translated by quarter at:
Q4 2005 1 USD = EUR 0.8408; Q1 2006 1 USD = EUR
0.8310; Q2 2006 1 USD = EUR 0.7951; and Q3 2006 1
USD = EUR 0.7846; average exchange rate in each
quarter per Bloomberg.




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14 BUSINESS ENVIRONMENT / POTASHCORP 2006 SUMMARY ANNUAL REPORT
 
 █
    
    Potash  Meet rising world demand█
    
    Nitrogen  Reduce volatility by focusing on our Trinidad asset█
    
    Phosphate  Enhance stability with industrial and feed production
 Our
Highest Margin Businesses  Year Ended December 31, 2006
 RISK MITIGATION SUPPORTS STRATEGIES
   █
    
    Markets/Business Risk█
    
    Distribution Risk█
    
    Operational Risk█
    
    Financial/Information Technology Risk█
    
    Regulatory Risk█
    
    Integrity/Empowerment Risk
  
 
   Pursuing the Best Position
 (PICTURE)PotashCorps
Trinidad nitrogen facility
    
    We focus on areas of our business where we have cost advantages and lower competitive
pressures, which allows us to maximize gross margin. We strive to build on the parts of our
business that fit in the top right quadrant of our strategic positioning profile.
 
   1




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POTASHCORP 2006 SUMMARY ANNUAL REPORT / BUSINESS ENVIRONMENT 15
   POTASH:
 Meet Rising World Demand
 █
    
    Use our excess capacity to fill rising world demand.With our competitors operating at or near their maximum capabilities, we are uniquely able to
meet demand increases and capture a disproportionate share of market growth. Further, as we bring
on this excess capacity, we have triple leverage  higher sales volumes at higher prices, with
lower fixed costs per tonne.
 PotashCorp ProductionDriven by Demand
 
 █
    
    Produce only what the market requires. If demand does not materialize, we will not use our
excess capacity. For almost two decades, we have matched production to market demand, minimizing
inventory overhang. This has enabled us to maximize the value of our potash, preserving our unused
capacity for periods with rising demand and higher prices.█
    
    Maximize our internal capacity. Although we have opportunities for the development of a greenfield
mine when growth in global demand makes that necessary, our shareholders benefit most from our
ability to debottleneck or expand our capacity at our existing facilities. We can do this more
quickly and at less cost than the five to seven years and approximately $1.6 billion needed for a
greenfield mine. By reducing the time and cost of achieving more capacity, we reduce risk to our
shareholders.█
    
    Extend our global potash enterprise through strategic investments. In addition to investing in our
internal potash assets, we focus our capital on strategic global investments. Our investments in
profitable and growing companies like SQM, APC, ICL and Sinofert add to our bottom line and, more
importantly, provide strategic value by extending our global reach.
 NITROGEN:
 Reduce Volatility by Focusing on Our Trinidad Asset
 █
    
    Leverage our proximity and long-term natural gas contracts in Trinidad to supply nitrogen to the US.
Close access to the United States, combined with lower-cost gas contracts indexed to ammonia
prices, provides a distinct advantage and more stable margins in a high-cost US gas environment.█
    
    Concentrate our US production on industrial sales that provide gross margin stability.Industrial
products shelter us from the volatility of agricultural cycles. We use our US nitrogen
production, with direct pipeline links from our production facilities, to supply this stable
customer base. In a high-cost US gas environment, we rely on our hedge program to stabilize costs
and, if necessary, reduce operating rates to minimize margin volatility.
  PHOSPHATE:
 Enhance Stability with Industrial and Feed Production
 █
    
    Leverage our high-quality, low-impurity phosphate rock to maintain a diversified and higher
margin product line.High-quality rock enables us to economically produce diversified industrial
and feed products that are less affected by cyclicality and deliver better margins than phosphate
fertilizers.
 For a complete overview of our businessstrategies, see our online Annual Report,Keyword »
    (STRATEGIES)




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16 BUSINESS ENVIRONMENT / POTASHCORP 2006 SUMMARY ANNUAL REPORT
 
  █
    
    Maximizing capacity to have potash available when neededPrimarily by bringing back idled capacity, we expect to have 13.5 million tonnes of operational capacity by
the end of 2010.We believe other expansions in Saskatchewan and New Brunswick could raise our capacity to 15.7
million tonnes by 2015. Only then would we need to rely on a greenfield project.█
    
    Adding compaction capability to improve the flexibility of our product mixCompaction allows us to produce premium granular product, which is in demand in North American
markets and increasingly in offshore markets. It commands $10 to $20 per tonne more than
standard-grade potash. We are adding an additional 1.25 million tonnes of compaction capability
at Allan and Lanigan which will enable us to move toward the product mix that tomorrows potash
markets will demand.
 █
    
    Broadening our offshore investmentsWe are continuing to strengthen our global enterprise by increasing ownership interests in key
offshore potash businesses. This gives us greater reach to markets that are experiencing
accelerating growth.
 
 In 2006 we raised our ownership in:
 
    
    Sinofert, from 10 percent to 20 percent. This gives us a strategic foothold in China, the
worlds largest fertilizer market. Sinofert distributes 60 percent of imported fertilizers in
China and generates more than half its total gross margin through potash sales;
    
    SQM, a specialty potash, iodine and lithium producer in Chile, from 25 percent to 32 percent; and
    
    APC, a leading potash producer and key supplier to Mediterranean and Asian markets.
 █
    
    Investing in our distribution chainTo capitalize on the growth opportunity in potash markets, it is important that our transportation
and distribution system is prepared for increased volumes.In 2006, we:
 
    
    participated in the development of two terminals in Brazil; and
    
    added terminals in the US on a variable-cost basis where we pay only when we use them.
 Canpotex, the offshore marketing company for all Saskatchewan potash producers, is strengthening
its capabilities by:
 
    
    evaluating the addition of approximately 500 railcars per year over the next few years to
transport product from Saskatchewan to West Coast ports;
    
    increasing capacity at its Portland, Oregon terminal by 1 million tonnes; and
    
    exploring alternatives for expansion or construction at West Coast port facilities that serve
offshore markets.
   
 Expanding Our Trinidad Advantage
 █
    
    Over the past two years, we expanded our Trinidad ammonia production. This gives us greater
ability to meet rising US demand for ammonia while using our lowest-cost nitrogen facility.
 Building on Phosphate Strengths
 █
    
    In 2006, we completed another purified phosphoric acid expansion at Aurora that will enable
us to better serve higher-margin industrial markets.




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POTASHCORP 2006 SUMMARY ANNUAL REPORT / BUSINESS ENVIRONMENT 17
 UNDERSTANDING
POTASH For
more information about potash, see our online Annual Report, Keyword
»
 
 STRATEGIES
    
    RISKS
    
    MITIGATION
    
    CAPABILITY TO DELIVERUse excess capacity to fill rising demand
    
     Insufficient capacity
available in time to meet growing demand
    
     Pace internal growth to ensure production is available when needed
    
     ~ 75 percent of global excess capacity in 2007 and 13.5 million tonnes capacity by end of decade Inadequate distribution
capability to supply markets
    
     Invest in distribution chain
    
     Capacity at terminals in
North America and Brazil is
being raisedProduce only what the market requires
    
     Short-term reduction in demand
    
     Limit production in periods
of lower demand
    
     Production curtailed
historically, including 2006, to
prevent inventory overhangExtend global potash enterprise
    

 Competitor greenfield developments change
market fundamentals
    
     Restore and expand capacity
at a fraction of the cost and
time of greenfield projects
    
     Lower-cost capacity up to
15.7 million tonnes before a
greenfield mine is required




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18 BUSINESS ENVIRONMENT / POTASHCORP 2006 SUMMARY ANNUAL REPORT
 UNDERSTANDING NITROGEN
    
    More nitrogen information is at our online Annual Report, Keyword »
(NITROGEN)
 
 STRATEGIES
    RISKS
    MITIGATION
    CAPABILITY TO DELIVERLeverage benefits of lower-cost Trinidad production
     Abundant low-cost gas supply in developing countries can lead to oversupply
     Protect Trinidads cost advantage and ability to deliver through gas contracts and vessel leases
     Multi-year, lower-cost gas contracts provide cost advantage and long-term vessel leases secure deliveryConcentrate US production on industrial sales
     Nitrogen fertilizers subject to volume and price volatility
     Emphasize sales to stable industrial customer base
     About 85 percent of US manufactured ammonia is sold to industrial customers, some linked directly by pipeline




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POTASHCORP 2006 SUMMARY ANNUAL REPORT / BUSINESS ENVIRONMENT 19
 UNDERSTANDING
PHOSPHATE For
more on phosphate, see our online Annual Report, Keyword »
 (PICTURE)STRATEGIES
    RISKS
    MITIGATION
    CAPABILITY TO DELIVERLeverage high-quality
phosphate rock to supply
higher-margin product lines
     Changes in environmental
or permitting requirements
     Engage with local
communities and stakeholders
to better understand and
address their needs
     2006 survey of community
leaders affirmed strong support for
operations Less competitive in solid
fertilizers given higher
delivered ammonia costs,
coupled with potential long-term oversupply of DAP
     Develop long-term plans to
reduce exposure or rationalize
production away from solid
phosphate fertilizers
     Long-term solid phosphate
fertilizer alternatives are under
evaluation(BAR GRAPHS AND PIE CHARTS)




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20 BUSINESS ENVIRONMENT / POTASHCORP 2006 SUMMARY ANNUAL REPORT
 
 Growing Demand + Tight Supply = Promising Outlook
    █
    
    Long-term demand for fertilizer, especially potash, is growing as:
 
    
    More of the worlds growing populationwants  and can afford  nutritious food
    
    Renewable alternative energy sources are creating new demand for many crops
 █
    
    Potash supply is tight, with competitors operating at or near their capacities█
    
    Prices for crop commodities are rising█
    
    Our excess potash capacity will be available, as needed, to support this growing market.
  For a more detailed outlook,see our online Annual Report,Keyword »
    (OUTLOOK)




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POTASHCORP
2006 SUMMARY ANNUAL REPORT / BUSINESS ENVIRONMENT 21
 
  The Fertilizer Outlook for 2007 Is Promising
   Potash
    Nitrogen
  Phosphate
 World N, P and K Sales Growth Forecast
 
 World Potash Sales Growth Forecast
 
 US DAP Exports




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22 BUSINESS ENVIRONMENT / POTASHCORP 2006 SUMMARY ANNUAL REPORT
 
 Goals & TargetsOur business goals are linked to the vision and strategy guiding the company.
    
    l ACHIEVED¤ PARTIALLY ACHIEVED¦ DID NOT ACHIEVEEach year we set targets linked to our goals, holding ourselves publicly accountable for our performance.
 Shareholder Value
 █  To continue to outperform our sector and other basic materials companies in total shareholder return.2006 Targets
    2006 Results
    
    2007 TargetsExceed total shareholder return performance for our sector and companies on the DJUSBM1for 2006.
    l Total shareholder return of 79.6 percent surpassed our sector at 53.5 percent and the DJUSBM at 17.6 percent.
    
    1Exceed total shareholder return performance for our sector and companies on the DJUSBM for 2007.Non-cash operating working capital to be less than 10 percent of net sales.2
    ¦ PotashCorps non-cash operating working capital was approximately 13 percent of net sales.
    
    2Cash flow return to exceed weighted average cost of capital by 600 basis points.Cash flow return2to exceed weighted average cost of capital by 800 basis points.
    ¤ Cash flow return exceeded weighted average cost of capital by more than 500 basis points.
    
    3Carry a higher multiple than the average of other fertilizer companies on both earnings and cash flow.Carry a higher multiple than the average of other fertilizer companies on both earnings and cash flow.
    l PotashCorp multiples were higher than the average of other fertilizer companies based on earnings and cash flow.
    
    4Gross margin compound annual growth rate (CAGR) of 15 percent over next five years.Exceed 2005 gross margin by 20 percent.
    ¦ Gross margin was 11 percent lower than in 2005.
 Cost Management
 █  To be the low-cost supplier on a delivered basis in our industry through ongoing cost reduction management.2006 Targets
    2006 Results
    
    2007 TargetsAchieve 5-percent reduction in per-tonne potash conversion costs on a Canadian dollar basis.
    ¦ Canadian dollar potash conversion costs rose by 27 percent due to production curtailment.
    
    1Achieve 3-percent reduction in per-tonne potash conversion costs on a Canadian dollar basis.Improve energy efficiency in Trinidad by 10 percent from 2005.
    ¤ Energy efficiency in Trinidad was improved by 3 percent from 2005.
    
    2Improve energy efficiency in Trinidad by 3 percent from 2006.Achieve rock costs at Aurora and White Springs 3 percent below 2005.
    ¦ Rock costs were 5 percent above 2005, with power and reagent cost increases well above expectations.
    
    3Achieve rock costs at Aurora and White Springs 1 percent below 2006.Achieve conversion costs for P2O5 production 9 percent better than 2005.
    ¤ P2O5 conversion costs were 3 percent better than 2005.
    
    4Maintain cash conversion costs for P2O5 at 2006 levels.Reduce/avoid transportation and distribution expenses to achieve a level 3 percent below market rates.
    l Transportation and distribution costs were 7 percent below market rates.
    
    5Reduce/avoid transportation and distribution expenses to achieve a level 3 percent below market rates.
 1Dow Jones US Basic Materials index
    
    2See reconciliation and description of certain non-GAAP measures on Page 33




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POTASHCORP 2006 SUMMARY ANNUAL REPORT / BUSINESS ENVIRONMENT 23
   Sales and Marketing
 █  To remain the leader and preferred supplier of potash, nitrogen and phosphate products worldwide.2006 Targets

2006 Results
    

2007 TargetsIncrease North American realized prices for potash by 10 percent.
    ¤ North American realized potash prices increased by 7 percent.
    
    1Potash gross margin to exceed $800 million, more than 40 percent above 2006.Increase offshore potash sales volumes by 5 percent.
    ¦ Offshore potash volumes declined by 12 percent due to extended price negotiations.
    
    2Phosphate gross margin to be up by 50 percent from 2006.Increase North American realized feed prices by 20 percent.
    l North American realized feed prices increased by 25 percent.
    
    3Nitrogen gross margin to exceed $325 million.Increase realized nitric acid prices by 5 percent.
    l Realized prices for nitric acid increased by 6 percent.
    
    4Outperform competitors on quality and service as measured by customer surveys.
 Sustainability
 █ To move closer to our goal of no harm to people, no accidents, no damage to the environment.█ To have motivated and productive employees committed to our long-term goals.█ To improve the socio-economic well-being of our communities.█ To be a leader in corporate governance.2006 Targets

2006 Results
    

2007 TargetsReduce recordable injury rate by 30 percent from 2005.
    ¤ Achieved a record low recordable injury rate, representing a 23-percent reduction from 2005.
    
    1Reduce recordable injury rate by 15 percent from 2006.Reduce lost-time injury rate by 30 percent from 2005.
    ¦ Lost-time injury rate was 8 percent above 2005.
    
    2Reduce lost-time injury rate by 40 percent from 2006.Reduce reportable releases and permit excursions by 30 percent from 2005.
    l Releases and permit excursions were reduced by 45 percent.
    
    3Reduce reportable releases and permit excursions by 10 percent from 2006.Achieve total compliance on environmental, safety and security audit action items.
    l 100-percent compliance was achieved.
    
    4Fill at least 75 percent of senior staff openings with internal candidates.Fill at least 75 percent of senior staff openings internally.
    ¤ Filled 72 percent of senior staff openings with internal candidates.
    
    5Improve employee engagement, as measured by surveys, by 10 percent from 2006.Maintain or improve employee engagement as measured by surveys.
    N/A A new survey format used in 2006 made prior survey results incomparable. The new survey will serve as a baseline for future engagement surveys.
    
    6Achieve a 10-percent increase in individual participation in the matching gift program and a 20-percent increase in total donations.Stabilize employee turnover at Trinidad operations.
    l Employee turnover at Trinidad was reduced from 2005.
    
    7Remain in the top quartile of governance practices as measured by predetermined external reviews.Continue to be engaged with community support projects at our plants and offices.
    l Our company and people were engaged in volunteer efforts, cash donations and relationship-building activities.Achieve a 10-percent increase in individual participation in the matching gift program and a 20-percent increase in total donations.
    ¦ Not achieved due to significant 2005 donations directed to Asian tsunami and Hurricane Katrina relief efforts. Excluding these two events, participation and donations exceeded 2005.Remain in the top quartile of governance practices as measured by external reviews.
    l Governance practices placed ninth among 204 S&P/TSX companies evaluated by Report on Business.




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24
    
    SUSTAINABILITY / POTASHCORP 2006 SUMMARY ANNUAL REPORT
 CONNECTING SUSTAINABILITY WITH LONG-TERM SHAREHOLDER VALUE
 PotashCorps commitment to sustainability does more than measure financial, social and
environmental performance. It brings our vision and values to the forefront when decisions are
made. Ultimately, it improves the way we operate for all stakeholders, giving us greater strength
for the future and building long-term shareholder value.
    

To hear audio interviews with senior management on key sustainability topics, see our online
annual report,Our sustainability committee has identified five key platforms that are important to our ongoing
operational and financial success:
    

Keyword »

(SUSTAINABILITY Q&A)SAFETY
    
    DIVERSITY
    
    (PHOTO OF JOHN HUNT)
(PHOTO OF JANE IRWIN)
(PHOTO OF DAVID DELANEY)
(PHOTO OF JIM DIETZ)A safety-driven culture reduces the
likelihood of accidents, injuries and death.
While the well-being of employees and
contractors is our main goal, the company
also realizes operating efficiencies from
fewer disruptions to work flow and lower
insurance premiums.
In 2006, our focus on safety led to a
record low recordable injury rate.
    
    Employees identified workplace diversity
as an important factor in their engagement
with PotashCorp. Diversity also gives us
ideas and insights that are important for
a company with global operations,
investments and customers.

To maximize
the contribution of our broad
workforce and focus on the strength
we gain through diversity, we completed
in-person and online diversity training with
all our employees in 2006.STAKEHOLDER ENGAGEMENT
    
    ENVIRONMENT
    
    PHILANTHROPYOur long-term performance is directly
related to our ability to understand
stakeholder expectations and make
decisions that position us to meet the
needs of the people who depend on us.

In 2006, we completed surveys with key
customer groups, our investor base and
community leaders at five locations. The
results help shape decisions made by our
Board of Directors and senior
management team.
    
    By restoring fertility to the worlds
agricultural land, PotashCorps products are
inherently beneficial to the environment.
We strive to minimize the environmental
impact of our operations and improve our
energy efficiency.

Over the past five years,
our energy efficiency per tonne has
improved by over 10 percent, resulting
in significant savings.
    
    A strong company can help build a
healthy community. We contribute to
organizations and events that improve
the quality of life in the areas where we
work and live.
During the year, we continued to deliver
significant support  in cash and through
volunteer efforts  to various groups that
improve our communities. By partnering
with our employees through the
matching gift program, we maximize
the total value of our donations to a
range of community partners.(PICTURE)
    
    n  CEO DOYLE HEADS IFA SUSTAINABILITY INITIATIVEPotashCorp has taken a leadership role in our industry and has stepped to the forefront on issues
of sustainability and transparency.
In 2006, President and CEO Bill Doyle was elected by members of the International Fertilizer
Industry Association (IFA) to be the organizations first-ever Vice President for Sustainable
Development. This position was created to strengthen the industrys ability to address
environmental issues and to promote the widespread adoption of sustainable business practices
among the Associations members.




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POTASHCORP 2006 SUMMARY ANNUAL REPORT / SUSTAINABILITY 25
  PROVIDING LEADERSHIPAT THE BOARD LEVEL
 (PHOTO OF DALLAS HOWE)
    
    Dallas HoweChair, PotashCorp Board of Directors
    Core Values and Code of Conduct
 (PHOTO)
    
    
    SETTING A  NEW STANDARD  FOR SAFETY
   Accident Prevention
 Tracking Compliance
 Safety Attitudes
 Contractor Safety
  Reducing Our Recordable Injury Rate




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26 SUSTAINABILITY / POTASHCORP 2006 SUMMARY ANNUAL REPORT
 LISTENING TO POTASHCORP STAKEHOLDERS
    Fertilizer
 
 Feed
 
 Industrial Nitrogen
 
 Purified Phosphate
 Customers
    Fertilizer
 
    
    PotashCorp received the industrys highest ranking for
reliability of supply, one of the most important criteria for
customers.
    
    Our sales representatives were recognized as the most
knowledgeable in the industry, which provides a significant
advantage in maintaining strong relationships with
customers.
    
    Ratings of our delivery and truck-loading capabilities suggest improvement is needed.
 Feed
 
    
    Product quality issues are important to feed customers.
PotashCorp earned the highest marks in this category.
    
    Phytase enzymes and alternative products are gaining
traction with customers and are areas to be watched.
 Industrial Nitrogen
 
    
    Availability of supply, quality and on-time delivery are
important for industrial nitrogen customers. PotashCorp earned
93 of a possible 100 points for reliability of long-term supply and 95
for product quality. Customers were not asked to rate companies
for on-time delivery.
    
    We earned the highest ratings for product quality, with
customers most important measure of quality being the
ability to meet product specifications.
    
    Rising costs for energy, raw materials and transportation
are of importance to industrial
nitrogen customers.
 Purified Phosphate
 
    
    Product quality is the key criterion for purified
phosphate customers. PotashCorp is consistently ranked
as the industry leader in this category.
    
    Our scores on order entry and invoicing suggest these are areas where we can improve.




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POTASHCORP 2006 SUMMARY ANNUAL REPORT / SUSTAINABILITY 27
   Investors
 ▲ l
  
    
    Potash is considered the biggest value
driver for our company, with emerging
markets desire for food as the key factor
of influence.
    
    Many investors believe the agriculture
environment will be even more positive within
three years.
    
    Over three-quarters of investors view the
potash sector as a long-term investment
while nitrogen and phosphate are seen as
more short-term and cyclical.
    
    Most investors place priority on growth
and advocate strategic investment in
assets.
 Community Leaders
   
    
    our community involvement;
    
    our business practices, specifically in the areas of
safety, health and environment; and
    
    our impact on local economies.
  Community Involvement
    
    
    4.3/5Business Practices
    
    
    4.3/5Economic Value
    
    
    4.4/5Overall Rating
    
    
    4.3/5
 █
    
    IMPROVING OUR COMMUNITIES
   
 
    
    took an active role in sponsoring community events,including the PotashCorp
Vanier Cup in Saskatoon (Canadas university football championship) and the
Cricket World Cup in Trinidad;
    
    increased awareness of our matching gift programand made improvements that
reduced the minimum and increased the maximum contribution levels; and
    
    was named the Top Corporate Citizenby the North Suburban United Way, a chapter of
the Metropolitan United Way of Chicago. We also received the Campaign Chairs Choice
Award from the United Way of Saskatoon and Area for the best overall performance
by a workplace campaign, which reflected record employee contributions at the
local minesites and the corporate office.
   █
    
    INVOLVING BUSINESS PARTNERS IN
SUSTAINABILITY
   
 Suppliers
 Customers www.enriching.com




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28
    
    FINANCIAL OVERVIEW / POTASHCORP 2006 SUMMARY ANNUAL REPORT
 FINANCIAL OVERVIEW
 Get inside the numbersThe condensed consolidated financial
statements in this Summary Annual Report
provide an overview of PotashCorps
performance. For complete consolidated
financial statements, notes and our
Managements Discussion & Analysis,go to Keyword »
    (FINANCIALS)
  █
    
    MANAGEMENTS RESPONSIBILITYFOR FINANCIAL REPORTING
     W. Doyle
 W. Brownlee
 █
    
    REPORT OF INDEPENDENT REGISTERED CHARTERED ACCOUNTANTSTO THE SHAREHOLDERS OF POTASH CORPORATION OF SASKATCHEWAN INC.
    Independent Registered Chartered Accountants




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POTASHCORP 2006 SUMMARY ANNUAL REPORT / FINANCIAL OVERVIEW 29
 CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
 as at December 31
    in millions of US dollars except share amounts2006
    
    
    2005Assets
    
    
    
    
    
    
    
    
    
    Managements Discussion (unaudited)Current assets
    
    
    
    
    
    
    
    
    

Property, plant and equipment
Additions of $508.6 million
in 2006 include $216.7
million to bring back idled
potash capacity at our Allan
and Lanigan operations.Cash and cash equivalents
    
    $
    325.7
    
    
    $
    93.9Accounts receivable
    
    
    442.3
    
    
    
    453.3Inventories
    
    
    501.3
    
    
    
    522.5Prepaid expenses and other current assets
    
    
    40.9
    
    
    
    41.11,310.2
    
    
    
    1,110.8Property, plant and equipment
    
    
    3,525.8
    
    
    
    3,262.8Other assets
    
    
    1,254.7
    
    
    
    852.8
    
    
    Other assets
With further investments in
Sinofert ($126.3 million), APC
($3.7 million) and SQM ($235.0
million), the market value of
our offshore investments
exceeded book value by $1,653.2 million at year-end.Intangible assets
    
    
    29.3
    
    
    
    34.5Goodwill
    
    
    97.0
    
    
    
    97.0$
    6,217.0
    
    
    $
    5,357.9LiabilitiesCurrent liabilitiesShort-term debt
    
    $
    157.9
    
    
    $
    252.2Accounts payable and accrued charges
    
    
    545.2
    
    
    
    842.7
    
    
    Accounts payable and accrued charges
Current income taxes payable declined by
$160.4 million as a result of
Canadian installments for 2006
based on expectations higher
than actual results, while the
2005 required installments were
significantly lower than taxes
accrued for that year. A
reclassification of amounts
between current and future
income tax liabilities and lower
Canadian income tax rates also
contributed to the decrease.
Hedging margin deposits were
down $150.9 million with lower
natural gas prices and reduced
volumes of derivative contracts
outstanding.Current portion of long-term debt
    
    
    400.4
    
    
    
    1.21,103.5
    
    
    
    1,096.1Long-term debt
    
    
    1,357.1
    
    
    
    1,257.6Future income tax liability
    
    
    632.1
    
    
    
    543.3Accrued pension and other post-retirement benefits
    219.6
    
    
    
    213.9Accrued environmental costs and asset
retirement obligations
    110.3
    
    
    
    97.3Other non-current liabilities and deferred credits
    
    
    14.1
    
    
    
    17.23,436.7
    
    
    
    3,225.4Shareholders EquityShare capital
    
    
    1,431.6
    
    
    
    1,379.3
    
    
    Long-term debt
The issue of $500.0 million in
30-year notes, with an interest
rate of 5.875 percent, will
provide capital to repay $400.0
million of notes, with an
interest rate of 7.125 percent,
maturing in 2007 and for general
corporate purposes.Unlimited authorization of common shares
without par value; issued and outstanding
104,801,049 and 103,593,792 at
December 31, 2006 and 2005, respectivelyContributed surplus
    
    
    62.3
    
    
    
    36.3Retained earnings
    
    
    1,286.4
    
    
    
    716.92,780.3
    
    
    
    2,132.5$
    6,217.0
    
    
    $
    5,357.9
  -s- A. Laberge
    -s- E. Robert StrombergDirector
    Director




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30 FINANCIAL OVERVIEW / POTASHCORP 2006 SUMMARY ANNUAL REPORT
 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND RETAINED EARNINGS
 for the years ended December 31
    in millions of US dollars except per-share amounts2006
    
    
    2005Sales
    
    $
    3,766.7
    
    
    $
    3,847.2
    
    
    
    
    
    
    
    Managements Discussion (unaudited)Less:
    
    Freight
    
    
    255.8
    
    
    
    249.7
    
    
    
    
    
    
    

Gross margin
Although potash shipments were
severely constrained for the
first seven months of 2006, the
decline in gross margin
was not substantial. Nitrogen
gross margin benefited from a
strong pricing environment,
while phosphate gross margin
was the highest since 1999.Transportation and distribution
    
    
    134.1
    
    
    
    121.9Cost of goods sold
    
    
    2,374.8
    
    
    
    2,350.6Gross Margin
    
    
    1,002.0
    
    
    
    1,125.0Selling and administrative
    
    
    158.4
    
    
    
    144.5Provincial mining and other taxes
    
    
    66.5
    
    
    
    137.2Foreign exchange (gain) loss
    
    
    (4.4
    )
    
    
    12.5Other income
    
    
    (94.0
    )
    
    
    (61.8
    )126.5
    
    
    
    232.4
    
    
    
    
    
    
    

Provincial mining and other taxes
Saskatchewan Potash Production
Tax declined as a result of
lower potash gross margin and
the deductibility of capital
expenditures on potash, most of
it to bring back idled
capacity.Operating Income
    
    
    875.5
    
    
    
    892.6Interest Expense
    
    
    85.6
    
    
    
    82.3Income Before Income Taxes
    
    
    789.9
    
    
    
    810.3Income Taxes
    
    
    158.1
    
    
    
    267.4
    
    
    
    
    
    
    

Other income
Dividend income and earnings
from equity investments
comprised $75.5 million of 2006
other income (2005  $61.3).
The increase was primarily
attributable to higher dividend
income from ICL and a
$3.0-million dividend from
Sinofert received in 2006.Net Income
    
    
    631.8
    
    
    
    542.9Retained Earnings, Beginning of Year
    
    
    716.9
    
    
    
    701.5Repurchase of Common Shares
    
    
    
    
    
    
    (462.5
    )Dividends
    
    
    (62.3
    )
    
    
    (65.0
    )
    
    
    
    
    
    

Income taxes
The combination of income tax
refunds received, changes in
tax rates and lower operating
income led to a reported tax
rate of approximately 20
percent in 2006 compared to 33
percent in 2005. Exclusive of
income tax refunds and the
effect of rate changes on our
future income tax liability,
our effective tax rate was 30
percent in 2006.Retained Earnings, End of Year
    
    $
    1,286.4
    
    
    $
    716.9Net Income per Share  Basic
    
    $
    6.08
    
    
    $
    5.00Net Income per Share  Diluted
    
    $
    5.95
    
    
    $
    4.89Dividends per Share
    
    $
    0.60
    
    
    $
    0.60




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POTASHCORP 2006 SUMMARY ANNUAL REPORT / FINANCIAL OVERVIEW 31
 CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOW
 for the years ended December 31
    
    
    
    
    
    in millions of US dollars2006
    
    
    
    
    
    
    2005Operating Activities
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Managements Discussion (unaudited)Net income
    
    
    
    
    
    $
    631.8
    
    
    
    
    
    
    $
    542.9
    
    

Cash
provided by operating activities
Changes provided by operating
working capital negatively
impacted cash provided by
operating activities. Operating
cash flow due to changes in
accounts payable and accrued
charges reduced cash flow from
operations during 2006 due to:
(1) reductions in income tax
payable because of paying 2005
Canadian income taxes due in
first-quarter 2006 and making
Canadian installments for 2006
based on more optimistic
expectations than actual
results;(2) a decline in
hedging margin deposits due to
falling gas prices and reduced
volumes of derivative contracts
outstanding; and(3) payments
of performance-based
compensation accruals that were
outstanding at December 31, 2005.Adjustments to reconcile net income to
cash provided by operating activitiesDepreciation and amortization
    
    
    242.4
    
    
    
    
    
    
    
    242.4Other
    
    
    66.6
    
    
    
    
    
    
    
    75.0Subtotal of adjustments
    
    
    
    
    
    
    309.0
    
    
    
    
    
    
    
    317.4Changes in non-cash operating 
working capitalAccounts receivable
    
    
    11.0
    
    
    
    
    
    
    
    (107.6
    )Inventories
    
    
    13.9
    
    
    
    
    
    
    
    (119.9
    )Prepaid expenses and other current assets
    
    
    0.2
    
    
    
    
    
    
    
    (5.8
    )Accounts payable and accrued charges
    
    

(269.1)
    
    
    
    
    
    
    
    238.1Subtotal of changes in non-cash
operating working capital
    
    
    
    
    
    
    (244.0
    )
    
    
    
    
    
    
    4.8Cash provided by operating activities
    
    
    
    
    
    
    696.8
    
    
    
    
    
    
    
    865.1Investing ActivitiesAdditions to property, plant and equipment
    
    
    
    
    
    
    (508.6
    )
   
    
    
    
    
    
    (382.7
    )Purchase of long-term investments
    
    
    
    
    
    
    (352.5
    )
   
    
    
    
    
    
    (190.9
    )Proceeds from disposal of property,
plant and equipment and long-term investments
    
    
    
    
    
    
    22.0
    
    
    
    
    
    
    
    12.4Other assets and intangible assets
    
    
    
    
    
    
    (0.6
    )
   
    
    
    
    
    
    5.9Cash used in investing activities
    
    
    
    
    
    
    (839.7
    )
   
    
    
    
    
    
    (555.3
    )Cash before financing activities
    
    
    
    
    
    
    (142.9
    )
   
    
    
    
    
    
    309.8Repurchase of common sharesWe repurchased 9,500,000 common
shares  at an average price of less than $90 per share  during 2005 under our
normal course issuer bid. We
completed the repurchase program
by December 31, 2005 and did not
initiate a new program
in 2006.Financing ActivitiesProceeds from (repayment of) long-term debt obligations
    
    
    
    
    
    
    482.6
    
    
    
    
    
    
    
    (10.1
    )(Repayment of) proceeds from short-term debt obligations
    
    
    
    
    
    
    (94.3
    )
   
    
    
    
    
    
    158.7Dividends
    
    
    
    
    
    
    (60.9
    )
   
    
    
    
    
    
    (65.4
    )Repurchase of common shares
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (851.9
    )Issuance of common shares
    
    
    
    
    
    
    47.3
    
    
    
    
    
    
    
    93.9Cash provided by (used in) financing activities
    
    
    
    
    
    
    374.7
    
    
    
    
    
    
    
    (674.8
    )Increase (Decrease) in Cash and Cash Equivalents
    
    
    
    
    
    
    231.8
    
    
    
    
    
    
    
    (365.0
    )Cash and Cash Equivalents, Beginning of Year
    
    
    
    
    
    
    93.9
    
    
    
    
    
    
    
    458.9Cash and Cash Equivalents, End of Year
    
    
    
    
    
    $
    325.7
    
    
    
    
    
    
    $
    93.9Supplemental cash flow disclosureInterest paid
    
    
    
    
    
    $
    106.8
    
    
    
    
    
    
    $
    86.3Income taxes paid
    
    
    
    
    
    $
    226.8
    
    
    
    
    
    
    $
    141.6




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##### Table of Contents



32 FINANCIAL OVERVIEW / POTASHCORP 2006 SUMMARY ANNUAL REPORT
 5 YEAR FINANCIAL AND OPERATING DATA
 FINANCIAL DATA (in millions of US dollars except per-share amounts)
 2006
    
    
    2005
    
    
    2004
    
    
    2003
    
    
    2002SalesPotash
    
    
    1,227.5
    
    
    
    1,341.1
    
    
    
    1,056.1
    
    
    
    758.7
    
    
    
    669.0Nitrogen
    
    
    1,284.1
    
    
    
    1,368.8
    
    
    
    1,210.4
    
    
    
    1,156.4
    
    
    
    841.4Phosphate
    
    
    1,255.1
    
    
    
    1,137.3
    
    
    
    977.9
    
    
    
    883.9
    
    
    
    714.0Total sales
    
    
    3,766.7
    
    
    
    3,847.2
    
    
    
    3,244.4
    
    
    
    2,799.0
    
    
    
    2,224.4Gross marginPotash
    
    
    561.1
    
    
    
    707.4
    
    
    
    422.8
    
    
    
    203.7
    
    
    
    218.0Nitrogen
    
    
    315.6
    
    
    
    318.7
    
    
    
    242.8
    
    
    
    193.2
    
    
    
    47.4Phosphate
    
    
    125.3
    
    
    
    98.9
    
    
    
    15.8
    
    
    
    (16.5
    )
    
    
    41.9Total gross margin
    
    
    1,002.0
    
    
    
    1,125.0
    
    
    
    681.4
    
    
    
    380.4
    
    
    
    307.3Capital expendituresPotash
    
    
    293.2
    
    
    
    165.5
    
    
    
    92.2
    
    
    
    50.9
    
    
    
    35.5Nitrogen
    
    
    75.5
    
    
    
    99.3
    
    
    
    62.1
    
    
    
    39.8
    
    
    
    47.0Phosphate
    
    
    119.7
    
    
    
    109.5
    
    
    
    56.8
    
    
    
    55.3
    
    
    
    126.3Corporate/Sales
    
    
    20.2
    
    
    
    8.4
    
    
    
    9.4
    
    
    
    4.7
    
    
    
    3.4Total capital expenditures
    
    
    508.6
    
    
    
    382.7
    
    
    
    220.5
    
    
    
    150.7
    
    
    
    212.2EBITDA*
    
    
    1,117.9
    
    
    
    1,135.0
    
    
    
    754.3
    
    
    
    171.8
    
    
    
    386.0Net income (loss)
    
    
    631.8
    
    
    
    542.9
    
    
    
    298.6
    
    
    
    (126.3
    )
    
    
    53.6Net income (loss)per share  diluted
    
    
    5.95
    
    
    
    4.89
    
    
    
    2.70
    
    
    
    (1.21
    )
    
    
    0.51Cash flow provided by
operating activities
    
    
    696.8
    
    
    
    865.1
    
    
    
    658.3
    
    
    
    385.5
    
    
    
    316.4Cash flow prior to working
capital changes*
    
    
    940.8
    
    
    
    860.3
    
    
    
    538.3
    
    
    
    368.5
    
    
    
    289.2Total assets
    
    
    6,217.0
    
    
    
    5,357.9
    
    
    
    5,126.8
    
    
    
    4,567.3
    
    
    
    4,685.6Long-term debt
    
    
    1,357.1
    
    
    
    1,257.6
    
    
    
    1,258.6
    
    
    
    1,268.6
    
    
    
    1,019.9Shareholders equity
    
    
    2,780.3
    
    
    
    2,132.5
    
    
    
    2,385.6
    
    
    
    1,973.8
    
    
    
    2,092.5
 OPERATING DATA (in thousands of tonnes except employee numbers)
 2006
    
    
    2005
    
    
    2004
    
    
    2003
    
    
    2002Employees at year-end
    
    
    4,871
    
    
    
    4,879
    
    
    
    4,906
    
    
    
    4,904
    
    
    
    5,199Potash production (KCl) tonnage
    
    
    7,018
    
    
    
    8,816
    
    
    
    7,914
    
    
    
    7,094
    
    
    
    6,447Nitrogen production (N) tonnage
    
    
    2,579
    
    
    
    2,600
    
    
    
    2,558
    
    
    
    2,619
    
    
    
    2,990Phosphate production (P2O5) tonnage
    
    
    2,108
    
    
    
    2,097
    
    
    
    1,962
    
    
    
    1,861
    
    
    
    1,512Potash sales  KCl tonnes
    
    
    7,196
    
    
    
    8,164
    
    
    
    8,276
    
    
    
    7,083
    
    
    
    6,327Nitrogen sales  product tonnes
    
    
    4,820
    
    
    
    5,220
    
    
    
    5,350
    
    
    
    6,080
    
    
    
    6,391Phosphate sales  product tonnes
    
    
    4,078
    
    
    
    3,971
    
    
    
    3,793
    
    
    
    3,647
    
    
    
    2,863
 *
    
    See reconciliation and description of certain non-GAAP measures on Page 33
 FINANCIAL TERMS
 Debt
to capital
 =
    total debt / (total debt + total shareholders equity)
 Net
debt to capital
 =
    (total debt  cash and cash equivalents) / (total debt  cash and cash
equivalents + total
shareholders equity)
 Current income taxes
 =
    income tax expense
(recovery)  provision for
(recovery of) future income
tax
 Cash flow
 =
    net income or
loss + income taxes + interest  current income + depreciation and amortization
 Cash flow return
 =
    cash flow / average (total assets)
 cash and cash equivalents + accumulated depreciation and
amortization  accounts
payable and accrued charges)
 EBITDA
 =
    earnings (net income or loss)
before interest, taxes,
depreciation and amortization
 Return on assets
 =
    net income or
loss / total assets




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##### Table of Contents



POTASHCORP 2006 SUMMARY ANNUAL REPORT / FINANCIAL OVERVIEW 33
 FINANCIAL PERFORMANCE INDICATORS (in millions of US dollars)
  
 
   RECONCILIATIONS AND CALCULATIONS
 2006
    
    
    2005
    
    
    2004
    
    
    2003
    
    
    2002
    
    
    2001
    
    
    1996Net income (loss)
    
    
    631.8
    
    
    
    542.9
    
    
    
    298.6
    
    
    
    (126.3
    )
    
    
    53.6
    
    
    
    121.2
    
    
    
    209.0Income taxes
    
    
    158.1
    
    
    
    267.4
    
    
    
    131.7
    
    
    
    (20.6
    )
    
    
    30.2
    
    
    
    68.2
    
    
    
    43.7Interest expense
    
    
    85.6
    
    
    
    82.3
    
    
    
    84.0
    
    
    
    91.3
    
    
    
    83.1
    
    
    
    80.3
    
    
    
    44.7Depreciation and amortization
    
    
    242.4
    
    
    
    242.4
    
    
    
    240.0
    
    
    
    227.4
    
    
    
    219.1
    
    
    
    185.7
    
    
    
    90.1EBITDA1
    
    
    1,117.9
    
    
    
    1,135.0
    
    
    
    754.3
    
    
    
    171.8
    
    
    
    386.0
    
    
    
    455.4
    
    
    
    387.5Cash flow prior to working
capital changes2
    
    
    940.8
    
    
    
    860.3
    
    
    
    538.3
    
    
    
    368.5
    
    
    
    289.2Accounts receivable
    
    
    11.0
    
    
    
    (107.6
    )
    
    
    (51.9
    )
    
    
    (39.5
    )
    
    
    (11.1
    )Inventories
    
    
    13.9
    
    
    
    (119.9
    )
    
    
    (10.5
    )
    
    
    11.8
    
    
    
    (18.2
    )Prepaid expenses and other
current assets
    
    
    0.2
    
    
    
    (5.8
    )
    
    
    (6.3
    )
    
    
    11.4
    
    
    
    (3.9
    )Accounts payable and accrued charges
    
    
    (269.1
    )
    
    
    238.1
    
    
    
    188.7
    
    
    
    33.3
    
    
    
    60.4Changes in non-cash operating
working capital
    
    
    (244.0
    )
    
    
    4.8
    
    
    
    120.0
    
    
    
    17.0
    
    
    
    27.2Cash provided by operating activities
    
    
    696.8
    
    
    
    865.1
    
    
    
    658.3
    
    
    
    385.5
    
    
    
    316.4Net income (loss)
    
    
    631.8
    
    
    
    542.9
    
    
    
    298.6
    
    
    
    (126.3
    )
    
    
    53.6Total assets
    
    
    6,217.0
    
    
    
    5,357.9
    
    
    
    5,126.8
    
    
    
    4,567.3
    
    
    
    4,685.6Return on assets
    
    
    10.2
    %
    
    
    10.1
    %
    
    
    5.8
    %
    
    
    (2.8
    %)
    
    
    1.1
    %Net income (loss)
    
    
    631.8
    
    
    
    542.9
    
    
    
    298.6
    
    
    
    (126.3
    )
    
    
    53.6Income taxes
    
    
    158.1
    
    
    
    267.4
    
    
    
    131.7
    
    
    
    (20.6
    )
    
    
    30.2Interest expense
    
    
    85.6
    
    
    
    82.3
    
    
    
    84.0
    
    
    
    91.3
    
    
    
    83.1Current income taxes
    
    
    (108.1
    )
    
    
    (227.3
    )
    
    
    (105.4
    )
    
    
    
    
    
    
    (24.2
    )Depreciation and amortization
    
    
    242.4
    
    
    
    242.4
    
    
    
    240.0
    
    
    
    227.4
    
    
    
    219.1Cash flow3
    
    
    1,009.8
    
    
    
    907.7
    
    
    
    648.9
    
    
    
    171.8
    
    
    
    361.8Total assets
    
    
    6,217.0
    
    
    
    5,357.9
    
    
    
    5,126.8
    
    
    
    4,567.3
    
    
    
    4,685.6Cash and cash equivalents
    
    
    (325.7
    )
    
    
    (93.9
    )
    
    
    (458.9
    )
    
    
    (4.7
    )
    
    
    (24.5
    )Accumulated depreciation of property,
plant and equipment
    
    
    2,073.8
    
    
    
    1,927.7
    
    
    
    1,754.9
    
    
    
    1,576.2
    
    
    
    1,454.7Accumulated amortization of other
assets and intangible assets
    
    
    72.6
    
    
    
    66.4
    
    
    
    65.1
    
    
    
    70.1
    
    
    
    59.1Accumulated amortization of goodwill
    
    
    7.3
    
    
    
    7.3
    
    
    
    7.3
    
    
    
    7.3
    
    
    
    7.3Accounts payable and accrued charges
    
    
    (545.2
    )
    
    
    (842.7
    )
    
    
    (599.9
    )
    
    
    (380.3
    )
    
    
    (347.0
    )Adjusted assets
    
    
    7,499.8
    
    
    
    6,422.7
    
    
    
    5,895.3
    
    
    
    5,835.9
    
    
    
    5,835.2Average adjusted assets
    
    
    6,961.3
    
    
    
    6,159.0
    
    
    
    5,865.6
    
    
    
    5,835.6
    
    
    
    5,719.7Cash flow return3
    
    
    14.5
    %
    
    
    14.7
    %
    
    
    11.1
    %
    
    
    2.9
    %
    
    
    6.3
    %Short-term debt
    
    
    157.9
    
    
    
    252.2
    
    
    
    93.5
    
    
    
    176.2
    
    
    
    473.0Current portion of long-term debt
    
    
    400.4
    
    
    
    1.2
    
    
    
    10.3
    
    
    
    1.3
    
    
    
    3.4Long-term debt
    
    
    1,357.1
    
    
    
    1,257.6
    
    
    
    1,258.6
    
    
    
    1,268.6
    
    
    
    1,019.9Total debt
    
    
    1,915.4
    
    
    
    1,511.0
    
    
    
    1,362.4
    
    
    
    1,446.1
    
    
    
    1,496.3Cash and cash equivalents
    
    
    (325.7
    )
    
    
    (93.9
    )
    
    
    (458.9
    )
    
    
    (4.7
    )
    
    
    (24.5
    )Net debt4
    
    
    1,589.7
    
    
    
    1,417.1
    
    
    
    903.5
    
    
    
    1,441.4
    
    
    
    1,471.8Shareholders equity
    
    
    2,780.3
    
    
    
    2,132.5
    
    
    
    2,385.6
    
    
    
    1,973.8
    
    
    
    2,092.5Total debt to capital
    
    
    40.8
    %
    
    
    41.5
    %
    
    
    36.4
    %
    
    
    42.3
    %
    
    
    41.7
    %Net debt to capital4
    
    
    36.4
    %
    
    
    39.9
    %
    
    
    27.5
    %
    
    
    42.2
    %
    
    
    41.3
    %Sales
    
    
    3,766.7
    
    
    
    3,847.2
    
    
    
    3,244.4
    
    
    
    2,799.0
    
    
    
    2,224.4
    
    
    
    2,380.8
    
    
    
    1,604.9Freight
    
    
    255.8
    
    
    
    249.7
    
    
    
    238.7
    
    
    
    234.5
    
    
    
    215.2
    
    
    
    216.7
    
    
    
    144.6Transportation and distribution
    
    
    134.1
    
    
    
    121.9
    
    
    
    104.3
    
    
    
    98.7
    
    
    
    80.5
    
    
    
    83.3
    
    
    
    49.1Net sales5
    
    
    3,376.8
    
    
    
    3,475.6
    
    
    
    2,901.4
    
    
    
    2,465.8
    
    
    
    1,928.7
    
    
    
    2,080.8
    
    
    
    1,411.2
 FOOTNOTES
 1
    
    PotashCorp uses EBITDA as a
supplemental financial measure
of its operational performance.
Management believes EBITDA to
be an important measure as it
excludes the effects of items
which primarily reflect the
impact of long-term investment
decisions, rather than the
performance of the companys
day-to-day operations. As
compared to net income (loss)
according to GAAP, this measure
is limited in that it does not
reflect the periodic costs of
certain capitalized tangible
and intangible assets used in
generating revenues in the
companys business. Management
evaluates such items through
other financial measures such
as capital expenditures and
cash flow provided by operating
activities. The company
believes that this measurement
is useful to measure a
companys ability to service
debt and to meet other payment
obligations or as a valuation
measurement.2
    
    Cash flow prior to working
capital changes is defined as
the cash provided by operating
activities, exclusive of
changes in non-cash operating
working capital. PotashCorp
uses cash flow prior to
working capital changes as a
supplemental financial measure
in its evaluation of
liquidity. Management believes
that adjusting principally for
the swings in non-cash working
capital items due to
seasonality assists management
in making long-term liquidity
assessments. The company also
believes that this
measurement is useful as a measure
of liquidity or as a valuation
measurement.3
    
    PotashCorp uses cash flow and
cash flow return as
supplemental measures to
evaluate the performance of the
companys assets in terms of
the cash flow they have
generated. Calculated on the
total cost basis of the
companys assets rather than on
the depreciated value, these
measures reflect cash returned
on the total investment outlay.
The company believes these
measures are one of the best
predictors of shareholder
value. As such, management
believes this information to be
useful to investors.4
    
    Management believes that net
debt and net-debt-to-capital
ratio are useful to investors
because they are helpful in
determining the companys
leverage. It also believes
that, since the company has the
ability to and may elect to use
a portion of cash and cash
equivalents to retire debt or
to incur additional
expenditures without increasing
debt, it is appropriate to
apply cash and cash equivalents
to debt in calculating net debt
and net debt to capital.
PotashCorp believes that this
measurement is useful as a
financial leverage measure.5
    
    Management includes net sales
in its segment disclosures in
the consolidated financial
statements pursuant to Canadian
GAAP, which requires
segmentation based upon the
companys internal organization
and reporting of revenue and
profit measures derived from
internal accounting methods.
Net sales (and related
per-tonne amounts and other
ratios) are primary revenue
measures it uses and reviews in
making decisions about
operating matters on a business
segment basis. These decisions
include assessments about
potash, nitrogen and phosphate
performance and the resources
to be allocated to these
segments. It also uses net
sales (and related per-tonne
amounts and other ratios) for
business segment planning and
monthly forecasting. Net sales
are calculated as sales
revenues less freight,
transportation and distribution
expenses. Net sales presented
on a consolidated basis rather
than by business segment is
considered a non-GAAP financial
measure.




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##### Table of Contents



34
    
    BOARD
AND SENIOR MANAGEMENT / POTASHCORP 2006 SUMMARY ANNUAL REPORT
 POTASHCORP BOARD OF DIRECTORS
 
  COMMITTEES
 1
    
    Executive2
    
    Corporate governance and nominating3
    
    Compensation4
    
    Safety, health and environment5
    
    Audit
 Learn more about the PotashCorp Board of Directors
 in our online Annual Report, Keyword »




---



##### Table of Contents



POTASHCORP
2006 SUMMARY ANNUAL REPORT / BOARD AND SENIOR MANAGEMENT 35
 CORPORATE OFFICERS AND KEY MANAGEMENT




---



##### Table of Contents



36
    

SHAREHOLDER
INFORMATION / POTASHCORP 2006 SUMMARY ANNUAL REPORT
 SHAREHOLDER INFORMATION
  █ ANNUAL MEETING
    █ DIVIDENDS
   █ INFORMATION FOR SHAREHOLDERS OUTSIDE CANADA
 █ INVESTOR INQUIRIES
 
  █ COMMON SHARE TRANSFER AGENT
 In Canada:
    
    In the United States:CIBC Mellon Trust Company
    
    Mellon Investor Services, L.L.C.P.O. Box 7010
    
    480 Washington BoulevardAdelaide Street Postal Station
    
    Jersey City NJ  07310-1900Toronto ON  M5C 2W9Phone:
    
    (416) 643-5500
(800) 387-0825
    
    Phone: (800) 526-0801Website: www.cibcmellon.com
    
    Website: www.mellon.com
  
 █ OWNERSHIP
  █ SHARES LISTED
 
 █ FINANCIAL REPORTS AND NEWS RELEASES
  █ NYSE CORPORATE GOVERNANCE
  █ CORPORATE OFFICESCanada:
    

US:Suite 500
    
    Suite 400122  1st Avenue
SouthSaskatoon SK  S7K 7G3Phone: (306) 933-8500
    
    1101 Skokie Boulevard
Northbrook IL  60062
Phone: (847) 849-4200




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##### Table of Contents



POTASHCORP 2006 SUMMARY ANNUAL REPORT / SHAREHOLDER INFORMATION 37
 SHAREHOLDER INFORMATION
  █ COMMON SHARE PRICES AND VOLUMES
 Toronto Stock Exchange1
    
    
    
    New York Stock ExchangeHigh
    
    
    
    Low
    
    
    
    Volume
    
    
    
    High
    
    
    
    Low
    
    
    
    Volume2006First Quarter
    
    
    113.88
    
    
    
    91.50
    
    
    
    21,008,219
    
    
    
    99.24
    
    
    
    78.15
    
    
    
    55,217,500Second Quarter
    
    
    117.00
    
    
    
    86.79
    
    
    
    18,686,817
    
    
    
    106.40
    
    
    
    78.84
    
    
    
    54,130,300Third Quarter
    
    
    118.46
    
    
    
    92.01
    
    
    
    14,141,380
    
    
    
    106.48
    
    
    
    82.03
    
    
    
    41,196,600Fourth Quarter
    
    
    170.89
    
    
    
    113.25
    
    
    
    19,487,859
    
    
    
    147.19
    
    
    
    101.50
    
    
    
    61,695,700Year 2006
    
    
    170.89
    
    
    
    86.79
    
    
    
    73,324,275
    
    
    
    147.19
    
    
    
    78.15
    
    
    
    212,240,1002005First Quarter
    
    
    113.92
    
    
    
    89.11
    
    
    
    18,297,446
    
    
    
    92.00
    
    
    
    72.91
    
    
    
    32,012,000Second Quarter
    
    
    132.11
    
    
    
    98.39
    
    
    
    13,432,009
    
    
    
    106.67
    
    
    
    79.27
    
    
    
    29,833,400Third Quarter
    
    
    137.99
    
    
    
    108.23
    
    
    
    14,451,392
    
    
    
    115.15
    
    
    
    92.85
    
    
    
    24,526,600Fourth Quarter
    
    
    108.89
    
    
    
    84.76
    
    
    
    22,180,812
    
    
    
    93.32
    
    
    
    72.77
    
    
    
    46,103,900Year 2005
    
    
    137.99
    
    
    
    84.76
    
    
    
    68,361,659
    
    
    
    115.15
    
    
    
    72.77
    
    
    
    132,475,9002004First Quarter
    
    
    57.93
    
    
    
    50.96
    
    
    
    12,670,142
    
    
    
    44.75
    
    
    
    38.13
    
    
    
    15,905,400Second Quarter
    
    
    64.87
    
    
    
    54.58
    
    
    
    12,009,046
    
    
    
    48.50
    
    
    
    39.46
    
    
    
    23,604,000Third Quarter
    
    
    81.00
    
    
    
    60.75
    
    
    
    13,237,872
    
    
    
    64.25
    
    
    
    45.78
    
    
    
    30,366,000Fourth Quarter
    
    
    104.06
    
    
    
    76.05
    
    
    
    16,211,631
    
    
    
    84.00
    
    
    
    60.65
    
    
    
    29,245,700Year 2004
    
    
    104.06
    
    
    
    50.96
    
    
    
    54,128,691
    
    
    
    84.00
    
    
    
    38.13
    
    
    
    99,121,1001Trading prices are in Cdn$
    
    
    Source: Thomson Financial
   Yearly POT Stock Price Since Inception  NYSE Composite
 
 POT Share Ownership 
Geographic
Distribution(BAR CHART)
    
    2006 Monthly POT Stock Price 
NYSE
Composite(LINE CHART)




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38
    

GLOSSARY / POTASHCORP 2006 SUMMARY ANNUAL REPORT
  █
    
    FORWARD-LOOKING STATEMENTS
 █
    
    MARKET AND INDUSTRY DATA STATEMENT
   █
    
    SOURCES, ABBREVIATIONS, TERMS AND MEASURES
 ABBREVIATED COMPANY NAMES AND SOURCES*Agrium
    
    Agrium Inc. (TSX and NYSE: AGU), CanadaAPC
    
    Arab Potash Company Ltd. (Amman: ARPT), JordanBelaruskali
    
    PA Belaruskali, BelarusCanpotex
    
    Canpotex Limited, CanadaCVRD
    
    Companhia Vale do Rio Doce, BrazilDoane
    
    Doane Agricultural Services, USAFergus/Peters
    
    Fergus/Peters Group Inc., USAFertecon
    
    Fertecon Limited and Fertecon Research Centre Limited, UKIsrael Chemicals (ICL)
    
    Israel Chemicals Ltd. (Tel Aviv: ICL), IsraelIFA
    
    International Fertilizer Industry Association, FranceIMF
    
    International Monetary Fund, USAIntrepid
    
    Intrepid Potash, USAIPNI
    
    International Plant Nutrition Institute, USAKali & Salz (K+S)
    
    Kali und Salz GmbH (Xetra: SDF), GermanyMosaic
    
    The Mosaic Company (NYSE: MOS), USANYMEX
    
    New York Mercantile Exchange, USAPIRA
    
    PIRA Energy Group, USASilvinit
    
    JSC Silvinit, RussiaSinofert
    
    Sinofert Holdings Limited (HKSE, 0297.HK), ChinaSQM
    
    Sociedad Quimica y Minera de Chile S.A. (Santiago Bolsa de Comercio Exchange, NYSE: SQM), ChileThomson Financial
    
    Thomson Financial Inc., USATSX
    
    Toronto Stock Exchange, CanadaUralkali
    
    JSC Uralkali, RussiaUSDA
    
    US Department of Agriculture, USAYara
    
    Yara International (Formerly Hydro Agri and Hydro Gas and Chemicals) (Oslo: YAR), NorwayGLOSSARY OF TERMS2006E
    
    2006 Estimated2007F
    
    2007 ForecastCanpotex
    
    An export company owned by all Saskatchewan producers of potash (PotashCorp, Mosaic and Agrium)GLOSSARY OF TERMSConsumption vs Demand
    
    Product applied vs product purchasedGreenfield
    
    New operation built on undeveloped siteNorth America
    
    The North American market includes Canada and the United StatesOffshore
    
    Offshore markets include all markets except Canada and the United StatesPotashCorp
    
    Potash Corporation of Saskatchewan Inc. (PCS) and its direct or indirect subsidiaries, individually or in any combination, as applicableSCIENTIFIC TERMSNitrogen
    
    NH3
    
    ammonia (anhydrous), 82.2% NHNO3
    
    nitric acid, 22% N (liquid)UAN
    
    nitrogen solutions, 28-32% N (liquid)Phosphate
    
    P2O5
    
    phosphoric acid (liquid)MGA
    
    merchant grade acid, 54% P2O5(liquid)DAP
    
    diammonium phosphate, 46% P2O5(solid)MAP
    
    monoammonium phosphate, 52% P2O5(solid)SPA
    
    superphosphoric acid, 70% P2O5(liquid)MCP
    
    monocalcium phosphate, 48.1% P2O5(solid)DCP
    
    dicalcium phosphate, 42.4% P2O5(solid)DFP
    
    defluorinated phosphate, 41.2% P2O5(solid)Potash
    
    KCl
    
    potassium chloride, 60-63.2% (solid)FERTILIZER MEASURESP2O5 tonne
    
    Measures the phosphorus content of fertilizers having different chemical analysesN tonne
    
    Measures the nitrogen content of fertilizers having different chemical analysesProduct tonne
    
    Standard measure of the weights of all types of potash, phosphate and nitrogen products




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POTASHCORP 2006 SUMMARY ANNUAL REPORT / POTASHCORP AT A GLANCE
 WE HAVE A STRONG FOUNDATION...
   
 ...FOR BUILDING FUTURE PERFORMANCE
  
  *
    
    See reconciliation and description of certain non-GAAP measures on Page 33




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