We use them to give you the best experience. Danakali is developing the tier-1 Colluli potash project, Eritrea, which boasts the world's lowest costs and >200 years of mine life. The project has a 200-year lifecycle and is expected to start operating in 2022. products, such as Sulphate of PotashMagnesium (SOP-M), muriate of potash Danakali, an Australian company that has been developing the Colluli potash project in Eritrea, was recently granted permission by the Eritrean Ministry of Energy and Mines to commence commercial production at Colluli. Sadly, Eritrea looks set to remain a failed state as long as he is in office. Many Eritreans hoped that the peace deal with Ethiopia would create economic opportunities for the country, but there is little sign of that happening yet. These authors includeSilver Coast Research, , among others. endobj The JORC-2012 compliant ore reserve estimate at Colluli is estimated at 1,100 Mt at 10.5% K2O for 203 Mt of contained SOP equivalent (Fig. Some people have been in national conscription for more than 20 years. . If you have an ad-blocker enabled you may be blocked from proceeding. Colluli is the premier greenfield development project globally. Prime Minister Abiy Ahmed accused the Tigrayans of attacking a military camp and attempting to loot military assets. It nosedived again in 2017, this time by -10%, before jumping by 13% in 2018. The appointment of RA International is testament to sound execution of our growth strategy, highlighting continued new business momentum with another significant award in the mining sector., Your email address will not be published. As a matter of fact, Zijin Mining (OTCPK:ZIJMF) acquired Nevsun Resources along with its Bisha zinc-copper mine in Eritrea on December 28, 2018. The Australian company Danakali is developing the Colluli potash project in Eritrea and expects to bring it into production in 2022. The front-end engineering design (FEED), expected to be The project has the world's. 1). He is an alone, he is DICTATORSHIP! Surface mining allows controlled extraction, predictable production rates and efficient stockpiling of additional economic salts know to us. Eritrean troops are fighting on the Ethiopian government's side (Eritrea borders Tigray to the north). As a natural resources industry expert with years of successful investing experience, I conduct in-depth research to generate alpha-rich, low-risk ideas for the member of The Natural Resources Hub (TNRH). 9). A port development at Anfile Bay could assist in unlocking this potential. Finance > M-a. The UN sanction was lifted by the UN in November 2018 under Resolution 2444, by the EU in the following month, and by the U.S. in May 2019. DRA Global was selected as the engineering, procurement, construction and management (EPCM) contractor for the project in September 2018. Fig. After the Second World War, it was annexed to Ethiopia. In November 2021, Eritrea also signed a memorandum of understanding with China to join its Belt and Road Initiative. 11). It also has access to solar, wind and geothermal energy systems the East African rift. The agreement can be further extended by three years if mutually agreed upon. All land is considered state-owned and property rights are non-existent. Profit was boosted by higher metal grades and prices. And how is that relevant here, the government has not changed since Dankalis involvement so it was certainly a government worth doing business with at some time. Colluli is only 75km from the Red Sea coast, 87km from a port planned at the Anfile Bay, and 230km from the existing Port of Massawa, making it the SOP deposit closest to a coastline and giving it an advantage over competing projects in neighboring Ethiopia, such as the Yara Dallol project of Yara International ASA (. 5). Bloomberg News | December 23, 2022 | 7:38 am Premium Nickel aims to re-open Selebi mine in Botswana The Selebi south deposit has a resource of 11.28 million tonnes grading 0.98% nickel and 1.9% . The Danakil salt basin, in Eritrea, is a positively unique example as it is one of only very few known potash deposits where kainite, a sulphate bearing mineral key for potassium sulphate production, is found in solid form. body {top:0 !important;} Mineral & Phosphate Mining in the US industry outlook (2022-2027) poll Average industry growth 2022-2027: x.x lock Purchase this report or a membership to unlock the average company profit margin for this industry. development of the project, and the expected significant boost to royalties, "We have found Eritrea to be very transparent and consistent across the board," Seamus Cornelius, Danakali's executive chairman, said in an interview. By downloading this Whitepaper, you acknowledge that we may share your information with our white paper partners/sponsors who may contact you directly with information on their products and services. The shortfall of projected and actual global potash capacity, from this source. A Front-End Engineering Design (FEED) study confirmed an advanced stage and economically attractive Project. Below, let's look at Danakali Ltd. (DNK.ASX) (OTCPK:SBMSF) (OTCPK:DNKLY), which operates in Eritrea. PowerMiningOil & Gas >, MiningIndustrial MineralsMajor Commodities, Lithium Americas starts construction at Thacker Pass lithium project, Advance Lithium, LitioMx in talks to establish joint venture, Jindalee unveils updated mineral resource estimate at Mcdermitt Lithium Project, Advertise with us Advertising enquiries: Roy Morris, roy.morris@progressivemediainternational.com, +44 (0) 20 7406 6613. In June 2018, Danakali reached a binding take-or-pay offtake agreement with EuroChem Trading GmbH (EuroChem). We are confident in RA Internationals capabilities to deliver a high-quality product and service.. I have no business relationship with any company whose stock is mentioned in this article. 5. Additionally, it will provide comprehensive camp services incorporating catering, cleaning, laundry, pest and vector control, grounds keeping and waste management. Potash products including SOP, MOP, and SOP-M all have the potential to be produced at Colluli. Since then, potash price has fallen from the neighborhood of US$600/t MOP to as low as USS$200/t MOP by 2017, and has since been fluctuating between US$200/t and US$270/t. The FEED economic studies envisage the production of 472 Ktpa in module I for development capital of US$302 million and another 472 Ktpa in module II beginning year 6 for additional investment of US$202 million. Fig. Under the terms of the agreement, EuroChem will take, pay, market, and distribute up to 100% of the Colluli sites SOP fertiliser production over a 10-year term, from the Projects date of commissioning. Colluli is 75km from the Red Sea coast, providing unrivalled future logistics potential. Under the terms of the agreement, EuroChem will take, pay, market, and distribute up to 100% of the module I SOP production over a 10+3 year term from the project commissioning. Earth Moving Worldwide (EMW) was selected to provide mining services for the Colluli potash project in December 2019. of Eritrea and Ethiopia, which officially declared peace in July 2018. The country with an estimated $2.48bn economy and 3.6 million inhabitants has been ruled with an iron fist by its dictator President Isaias Afwerki, now aged 75 since he led it to independence from Ethiopia in 1993. The project is on the Eritrean side of the border, giving Colluli a significant advantage relative to the other potash development projects in the Danakil Depression, which need to ship from the Tadjoura Port in Djibouti over 790km by road from the closest project on the Ethiopian side of the border. The company's strategy targets the development of a world-class potash project that will become pivotal for global and African agriculture. The best energy and mining stock ideas with multibagger potential. Apart from SOP, the salt composition at the deposit also allows for the production of other potash products including sulphate of potash-magnesia (SOP-M) and muriate of potash (MOP). What Are the Best Fertilizer Stocks? second phase of development, as the project has a possible 200-year plus Last Updated on: 01 December 2022. The agreement encourages the maximisation of netback pricing of SOP produced in the Colluli, which will become the first Africa-based fertiliser provider in the supply chain of EuroChem. After all considerations and government taxes, Danakali said it expects to receive approximately $121m. However, the country is home to one of the world's biggest potash deposits which straddles the border with Ethiopia. % The Colluli Potash Project (Project, Colluli ) is 100%. Eritrea has historically struggled to attract large investments because of its unfavourable business climate. The Eritrean government, through ENAMCO, has a 50% interest in the Colluli project. Climate Change and its Impact on Insurance Market - Thematic Ukraine PESTLE Insights - A Macroeconomic Outlook Report, Germany PESTLE Insights - A Macroeconomic Outlook Report. Danakali is just one of many deep-value natural resources ideas covered by Laurentian Research. Fig. A comparison of the Colluli and competing greenfield SOP development projects in terms of the distance to the export port, from the same source as Fig. Morgan Leighton. A comparison of Colluli with vertically-integrated SOP producing competitors, from the same source as Fig. The miner said it would use the remaining cash about $12 million to identify new projects and potential new alternative growth opportunities.. The operating environment weighed heavily on Danakalis decision, as Eritrea is ruled by one of the worldsmost oppressive regimes and was until 2018 on the UNs sanctions list. Located in the Horn of Africa, prolonged periods of conflict and severe drought have had a catastrophic impact on the Eritrean economy and the country is one of the worlds poorest, with income per head estimated at $678 in 2022 (up from $501 in 2010). To the southeast of the teeming herds of wildlife in the Okavango Delta inBotswana, an offshoot of the Lundinminingdynasty is extending its search for the worlds biggestdiamonds. The company expects to start full commercial production in mid-December 2022. 6. Posted by Daniel Gleeson on 21st August 2020. Colluli is a major sulphate of potash (SOP) project located in Eritrea, Eastern Africa. Over 6Bt of potassium bearing salts suitable for the production of potash fertilisers have been identified in the region to date. Eritrea one of the least accessible countries for humanitarian organisations, Searches, Arrests, and Tension in Eritrea, Eritreas jailed journalist exhibition opens in UK Parliament, Dispute over Patriach splits Norwegian Orthodox church in two, Twenty one years after being jailed, Eritreas independent journalists are remembered in the British Parliament. The project has now obtained all licenses and permits within the license area and has also been granted all required permits, licences and authorisations for infrastructure construction and development outside the Colluli mining license area. keyValue[2].split('/')[2] : null;} The project's potential profitability is helped by soaring potash prices they jumped by 300% during 2021, sitting at above $700 per tonne (CFR Brazil Spot) at the end of October 2021. With a growing world population, demand for food will increase, while the availability of arable land is expected to shrink. Profit was boosted by higher metal grades and prices. However, China has set its sights on the country and perhaps it will receive large amounts of Chinese FDI in the future. During the long struggle, the people of Eritrea managed to forge a common national consciousness but, with peace established, they faced the task of overcoming their ethnic and religious differences in order to raise the country from poverty made worse by years of drought, neglect and war. Fig. To open fire on your own disabled [people] is pretty appalling.". 4. It has been a Unesco World Heritage Site since 2017. Eritrea one of the worlds most repressive and secretive states, known as the North Korea of Africa is poised to disrupt the global supply chain of fertiliser. Both are below. <>/Metadata 306 0 R/ViewerPreferences 307 0 R>> Materials handling trials have also been completed to determine the anti-caking requirements for the final SOP product. <>/ExtGState<>/Font<>/ProcSet[/PDF/Text/ImageB/ImageC/ImageI] >>/MediaBox[ 0 0 594.96 842.04] /Contents 4 0 R/Group<>/Tabs/S/StructParents 0>> DANAKALI Ltd., Eritrea - Colluli Potash Project | Aktienforum | Aktien Forum | Diskussionsboard | Community von finanzen.net In 2023, Botswana expects diamond output to decline by 1%. Image courtesy of Danakali. It also contains other fertilizer products, such as muriate of potash (MOP) and gypsum, along with rock salt.There is also potential for kieserite and mag chloride to be commercialized with minimal further processing required.A United Nations report published in 2019suggested that Colluli could significantly boost the economy of Eritrea.The project is the only known source of potash that allows extraction of the fertilizer in solid form. Phase one involving an estimated capital investment of $298m is expected to produce 472,000 tonnes (t) a year of high-quality SOP, while in phase two, the mine is expected to produce up to 944,000t of SOP from year six of the project with an additional capital investment of $202m. (3) various tools to aid your investment decision making, (4) trade alerts and multiple thematic weekly newsletters and. Potash, an important fertiliser, could be a game changer for Eritrea and other African countries. Whilst SOP demand is population growth story it is more of an economic growth story and the African continent is seen to be where the majority of the worlds economic growth will occur in the coming decades. The Colluli potash mine is estimated to hold 1.1 billion tonnes of SOP ore reserves grading 10.5% potassium oxide (K2O). What are the best countries for cryptocurrency adoption? Fig. The underapplication of SOP in developing regions where the highest rates of population growth are expected, from this source. The front-end engineering and design (FEED) study for the project was completed in January 2018. Net to Danakali's 50% interest, Module I is projected to generate NPV-10 of 242 million, on average delivering an undiscounted FCF of US$43 million per year, with a post-finance IRR of 29.7%; module I&II is projected to generate NPV-10 of 439 million, on average delivering an undiscounted FCF of US$85 million per year, with a post-finance IRR of 31.3% (Table 1). could rise to almost 944,000 tonnes if Danakali decides to go ahead with a AustraliasDanakali(ASX: DNK) is selling its 50% stake in the Colluli potash project in Eritrea, Africa, almost 13 years after partnering with the Eritrean National Mining Corporation (ENAMCO) to build the mine.Subject to conditions, the deal with Chinese company Sichuan Road and Bridge Group is expected to be finalized between March and May next year, leaving Danakali with $121 million cash, of which 90% will be distributed back to shareholders.The miner said it would use the remaining cash about $12 million to identify new projects and potential new alternative growth opportunities.The Colluli potash project is considered one of the worlds most significant and lowest-cost sources of sulphate of potash (SOP), a premium grade fertilizer.The project has the worlds largest JORC compliant reserve at 1.1 billion tonnes. At a SOP price of US$650/tonne, annual production would generate revenue equivalent to . In July 2013, major producer Belaruskali broke up with former Belarusian Potash Company cartel partner Uralkali, and in a move to grab market share, signed a potash sales contract for the Chinese market at US$315/t MOP. At Colluli, the JORC-2012 compliant mineral resource is estimated at 1,289 Mt at 11% K2O for 260 Mt of contained SOP equivalent. The JORC-2012 compliant mineral resource estimate, from this source. stream The accommodation camp, meanwhile, has been designed to accommodate 600 personnel during the production phase with the flexibility to accommodate 1,115 during the construction phase. There are 70 Subscribers monitoring this project. Eritrea has one of the most erratic economies in the world, partly due to chronic drought and highly variable agricultural output: its GDP surged by 31% in 2014 before plummeting by -20.6% in 2015. Colluli has been largely de-risked in terms of. The extracted ore will be sent to a nearby processing plant where it will undergo crushing, flotation, mixing, and drying for the production of the final SOP product. The report also identified how the mine could help Eritrea Danakali has reported a 1.1 billion ore reserve with a mine life of almost 200 years. At a forward P/FCF multiple of 2.6X for Module I (2022-) and 1.3X once Module II comes on-stream in 2028, Danakali appears to be undervalued. Potash supply has historically been controlled by production cartels, such as a German export monopoly in the early 1900s, the agreement strategies between German and French producers until 1939, and then oligopolistic competition prevailing on world markets (see here). These alternative producers require substantial lead times to generate their harvest salts for processing. Anyone can write a book, as long as is a white person, you would buy it even a white homeless from NYC. Extraction of the salts in solid form is a crucial positive differentiator of Colluli.