Colluli has a JORC-2012 compliant Measured, Indicated and Inferred Mineral Resource estimate of 1,289Mt @11% K20. 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. and mag chloride to be commercialized with minimal further processing required. (MOP) and gypsum, along with rock salt. With a growing world population, demand for food will increase, while the availability of arable land is expected to shrink. The project has the worlds largest JORC compliant reserve at 1.1 billion tonnes. The Colluli potash project is located in the Danakil Depression region of Eritrea, in East Africa, approximately 75km away from the Red Sea coast and approximately 177km southeast of capital Asmara. x][sF~w""s)d;9>u^v0@ROcTE&Agdjyr8_N>}\O_,g|yrqKbzlwGouQB b-*dkGO?-M^e1?!;=^RxGN{t2k JSUUSx=ce :jc`s>h. US Level 1 ADR's OTC-DNKLY, CUSIP.23585T101 The world's largest JORC compliant solid salt, Sulphate of . Soraya Narfeldt, CEO of RA International, said: We are delighted to have been chosen as the preferred contractor to work with Danakali and its partners on this project which we see as globally significant. Colluli has a JORC-2012 compliant measured, indicated and inferred resource of 1,289 Mt at 11% K20 equivalent and 7% kieserite. 2 0 obj Pilot tests from the Colluli salts have generated product samples for marketing purposes which are now being distributed to prospective customers. 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 Danakil Depression is located in the Southern region of Eritrea and extends over 300km into Eastern Ethiopia. Potash products including SOP, MOP, and SOP-M all have the potential to be produced at Colluli. Our services are intended for corporate subscribers and you warrant that the email address submitted is your corporate email address. Potash, an important fertiliser, is found in abundance in certain parts of Ethiopia and Eritrea. Eritrea was, until 2018, on the UNs sanctions list. The independent study, commissioned and funded by the UN Development Program (UNDP), assesses a wide range of econometric data and includes . Please disable your ad-blocker and refresh. Thank you for your comment. Colluli has been largely de-risked in terms of geopolitics, infrastructure, off-take, and financing, with the module I scheduled to come on-stream in 2022. taxation and exports, and from jobs and skills and economic development of the Some people have been in national conscription for more than 20 years. Australias Danakali (ASX, LON:DNK) said on Thursday it was in the final stages of completing the second phase of developmentof its world-class Colluli potash project in Eritrea, Africa. In turn the well-defined geological features support our ability to maximise the potential from this the multi salt deposit. DRA Global was selected as the engineering, procurement, construction and management (EPCM) contractor for the project in September 2018. 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. of Eritrea and Ethiopia, which officially declared peace in July 2018. He is one of the world's most brutal and paranoid dictators and has repressed the population for many decades. Table 1. The Colluli potash mine could be an economic game changer for Eritrea but the country is unlikely to undergo an economic transformation as long as Afwerki is in power. 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. 2. 9). The underapplication of SOP in developing regions where the highest rates of population growth are expected, from this source. The deposit is located in the Danakil depression region of Eritrea, about 75km away from the Red Sea coast and 177km south-east of Asmara, the capital city (with a population of 960,000 people). In addition to these benefits our grade control drilling provides us to approach the open cut mine plan with a high degree of selectivity and certainty. With the first production scheduled for 2022, Danakali is well positioned to emerge as a pure-play SOP producer in the coming years, especially considering its low-cost structure (Fig. The front-end engineering design (FEED), expected to be 2022 The Colluli potash project is a low-cost, long-life sulphate of potash (SOP) project under development in Eritrea, Eastern Africa. The project has the worlds largest JORC compliant reserve at 1.1 billion tonnes. There is also potential for kieserite The Colluli project requires low upfront development costs and is highly scalable for long-life production. This geographical advantaged is unique. 8. Danakali to cash out of Colluli. endobj In food production, potassium is removed from the soil in harvested crops and must be replaced in order to maintain future crop growth. Colluli boasts a 1.1Bt Ore Reserve and almost 200-year mine life, shallow mineralisation allowing low-cost open-cut mining, simple, proven, low-cost processing, favourable logistics, expansion, diversification and multi-commodity potential. Following the agreement, Collulis position as an economically attractive SOP greenfield development project has been reinforced. Finance > M-a. 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. Italy created the colony of Eritrea in the 19th century around Asmara and gave it its current name. It has a geographic area of 117,600km2, making it slightly larger than Bulgaria. With planned production of 1m tonnes/year of SOP, it will put Eritrea among the topten potash producers in the world. Colluli is 75km from the Red Sea coast, providing unrivalled future logistics potential. However, China has set its sights on the country and perhaps it will receive large amounts of Chinese FDI in the future. Value: R 200 Million+. (as referred to in ASX announcements of 3 October 2022, 1 December 2022, and 12 January 2023), it . Afwerki has become close to Abiy and is a sworn enemy of the Tigray Peoples Liberation Front, which ruled Ethiopia when the two countries fought a border war. I bought many shares @ 67 Cents per share, total of 240.000.00 Now the share is under 20 Cents. Prime Minister Abiy Ahmed accused the Tigrayans of attacking a military camp and attempting to loot military assets. 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% . This post has been syndicated from a third-party source. Image courtesy of Danakali. The SOP quality spectrum, from the same source as Fig. Two articles indicate the rapid progress towards the development of a vast potash mine in the Danakil desert. In late 2019, the China Shanghai Corporation for Foreign Economic and Technological Cooperation began constructing part of the 500km road connecting Eritreas Massawa and Assab harbours (both have special economic zones). It also contains other fertilizer products, such as muriate of potash (MOP) and gypsum, along with rock salt. Colluli, a 50:50 joint venture between Danakali and the Eritrean National Mining Corporation (ENAMCO), has been called a game-changer for Eritreas economy, as it is expected to become one of the worlds most significant and lowest-cost sources of sulphate of potash (SOP), a premium grade fertilizer. 2023 Glacier Media Group, All Rights Reserved, Botswana mining growth seen flat amid dim diamond outlook, Harmony Gold CEO says gold sector consolidation inevitable, Quest for worlds biggest diamonds gives De Beers a headache, Mali forecasts 3.5% decline in industrial gold output in 2023, Canada injects $75 million into BHPs Jansen potash mine, Russia raises fertilizer export quota by 500,000 tonnes, World to face potash price crunchas Brazil Potash propels Autazes project toward production, Europes largest rare earths deposit found in Sweden. It has been a Unesco World Heritage Site since 2017. At a SOP price of US$650/tonne, annual production would generate revenue equivalent to . The Perth-basedminer noted that despite covid-19 restrictions, engineering, procurement and construction management (EPCM) activities have continued as scheduled. Danakali has 100% of its sales locked in for the first ten years and with the option to extend for a further three through a take-or-pay offtake agreement with EuroChem, the Swiss mineral fertiliser producer. The saleable SOP product will be trucked via road for sipping to the Massawa port which is located approximately 230km north-west of the project site. . The project is the only known source of potash that allows extraction of the fertilizer in solid form. mine-life. The FEED economic estimates, from the same source as Fig. There was a famous incident where some of the disabled tried to walk into town to complain to him, and they were met by the police and the army who opened fire on them. SOP in developing regions where the highest rates of population growth are expected, from. Ok as claimed above I dure hope the dictatorship in place will be nice enough this time around to be honest and work for the sake of the people and show the truth about the budgetary issues to the public unlike what the dictatorship did on the gold mining sector.we Eritreans cannot wait to see the benefits of the potash industry on projects that will enhance peoples living standards and create a sustainable economic growth as stipulated on the government sustainable development goals and agendatime only will tell if the dictatorship will have a changing to work for the betterment of the country but not gew clicks. 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. In 2023, Botswana expects diamond output to decline by 1%. 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. RA, listed on the London Stock Exchanges AIM board, specialises in building, operating and maintaining facilities in remote and challenging conditions across Africa, providing complex humanitarian, governmental, mining, and other commercial developments and services, Danakali says. Required fields are marked *. The water supply for the project is proposed to be met through a pipeline connecting a water desalination plant located at Anfile Bay on the Red Sea coast. It describes Eritrea as "a dictatorship in which the media has no rights". It is generally used in combination with the other two macro-nutrients, nitrogen and phosphorus, to produce a range of fertilisers, the type used being dependent on the soil to which it will be applied. Notify me of follow-up comments by email. A number of unique characteristics make Colluli one of the world's largest and lowest-cost deposits of SOP. Danakali, currently undervalued and standing for a massive re-rating upon the first production, should be considered by risk-tolerant investors with a long time horizon. I wrote this article myself, and it expresses my own opinions. countries-EritreaReverso Context-: Only four out of now 55 countries-Eritrea, Swaziland, Libya and Somalia-lack a multi-party constitution, and the last two will get one soon. MoEM has shown support for the financing of the project by granting time to begin commercial production (up to mid-December 2022) as well as . The location of the Colluli potash deposit, from this source. The Colluli deposit comprises a massive JORC-2012 compliant Ore Reserve estimate of 1,100Mt @ 10.5% K2O for 203Mt of contained SOP equivalent, providing a mine life of almost 200 years. Colluli will be a simple open-cut mining operation utilising truck and shovel methods complemented by continuous surface miners. Agnico Eagle's EPS beat expectations; guidance maintained. 4. A big economic change will come to eritrea, proud to be an nseritrea. Colluli is located in the Danakil Depression region of Eritrea and is approximately 230km by road south-east of the port of Massawa, which is Eritreas key import/export facility. Additionally, it will provide comprehensive camp services incorporating catering, cleaning, laundry, pest and vector control, grounds keeping and waste management. A pre-feasibility study for the project was completed in February 2015 followed by the completion of a definitive feasibility study (DFS) in November 2015, while the mining license was granted in February 2017. 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. The above mineral reserves support 215 years of SOP production at 944 Ktpa as envisaged in modules I and II development plan. Colluli is located about 75 kilometres from the Red Sea coast, making it among the most accessible premium potash deposits globally. The total measured, indicated, and inferred SOP mineral resources at the deposit are estimated to be 1.29 billion tonnes grading 11% K2O. 3 0 obj Journalists say that getting any information out of the country is extremely difficult. Potassium is one of three key fertiliser macro-nutrients essential for healthy soil and plant growth. RA, listed . Fig. Colluli is located in the Danakil Depression region of Eritrea and is approximately 230km by road southeast of the port of Massawa, which is Eritreas key import/export facility. As a tier-1 potash deposit with a number of unique advantages to its favor, the fully-permitted Colluli carries little underground geological risk. Shallowest known evaporite deposit globally. advance its sustainable development agenda, which are 13 priority Sustainable The Eritrean government, through ENAMCO, has a 50% interest in the Colluli project. Some abridged samples of my writings are published here, while 4X as many unabridged articles are posted without delay at TNRH, a popular Seeking Alpha Marketplace service, where you also find: (1) a stream of high-alpha actionable investment ideas. 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). 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. Business intelligence for leaders in foreign direct investment. 6. 3). The Colluli Potash Project (Project, Colluli ) is 100%. Danakali is set to sell its stake in its flagship Colluli potash project in Eritrea for US$121 million. Eritreas north-eastern and eastern parts have an extensive coastline along the Red Sea, strategically located along the Maritime Silk Road. Internal industry and services contribute the majority of the remaining GDP, while agriculture accounts for only 13% (despite employing 80% of the population). The production of other agricultural and salt products, including Rock Salt, Kieserite, Gypsum and Magnesium Chloride, is also possible from the Colluli resource. Economic resources for Sulphate of Potash (SOP) production are scarce, and Colluli is favourably positioned to supply the worlds fastest-growing SOP markets. There is also potential for kieserite and mag chloride to be commercialized with minimal further processing required. 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. GDP dropped by -0.6% in 2020 in the wake of the Covid-19 pandemic and a locust invasion. 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. Potash, an important fertiliser, could be a game changer for Eritrea and other African countries. The company's strategy targets the development of a world-class potash project that will become pivotal for global and African agriculture. We have recently upgraded our technology platform. Upon accepting the notice, the ministry, Danakali said, also showed support for the financing of the Colluli project by: I focus on identifying high-quality deep values in the natural resources sector and undervalued wide-moat businesses, an investment approach that has proven to be extremely rewarding over the years. Your email address will not be published. These include: No poverty, zero hunger, quality 11). The plant administration and services facilities will incorporate administration offices, medical clinic, warehouses, and workshops (see graphic above, credit: RA International). These circumstances have resulted in it becoming one of the most isolated states in the world. Looking for a helping hand in the market? The Danakil Depression that commences in Eritrea and extends up to 300km into Ethiopia, is believed to contain more than six billion tonnes of potassium bearing salts. 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. 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). 3). On December 3, 2019, Africa Finance Corporation also agreed to make a US$50 million equity investment in two tranches at A$0.60 per Danakali share. Morgan Leighton. 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). At mine-gate production costs of US$149-165/t or total cash costs of US$242-258/t, Colluli can be profitable even at the current low SOP price of US$500-650/t. The open-cut, high-grade potash project is being developed by Colluli Mining Share Company (CMSC), a 50:50 joint venture partnership between Australias Danakali and Eritrean National Mining Corporation (ENAMCO). Danakali reports that the Colluli Mining Share Company (CMSC) has appointed RA International Group as its preferred contractor for the supply of accommodation, support services and other infrastructure buildings in support of the Colluli sulphate of potash project development, in Eritrea. Colluli, a 50:50 joint venture between Danakali and the Eritrean National Mining Corporation (ENAMCO), has been called a game-changer for Eritreas economy, as it is expected to become one of the worlds most significant and lowest-cost sources of sulphate of potash (SOP), a premium grade fertiliser. The stock chart of Danakali, modified from this source. A pre-feasibility study was completed in February 2015, followed by the completion of a definitive feasibility study in November 2015, while the mining licence was granted in February 2017. In 1993, after a brutal war of independence from Ethiopia lasting almost three decades and led by Isaias Afwerki Eritrea became a sovereign country. World potash demand has grown at an average rate of 2.5-3.0% per year since 2000 (Fig. Earth Moving Worldwide (EMW) was selected to provide mining services for the Colluli potash project in December 2019. The project has the world's. The project is the only known source of potash that allows extraction of the fertilizer in solid form. Colluli Mining Share Company secured 165m ($200m) of senior debt finance from the Africa Finance Corporation (AFC) and the African Export-Import Bank (Afreximbank) in August 2019.
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