The total measured, indicated and inferred SOP mineral resources at the deposit are estimated to be 1.29 billion tonnes grading 11% K2O. 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). Colluli is located about 75 kilometres from the Red Sea coast, making it among the most accessible premium potash deposits globally. with the move towards diplomatic relations between the once feuding countries The removal of Eritrea from the sanction list opened up the country for foreign investments, thus significantly reducing geopolitical risk. The production of other agricultural and salt products, including Rock Salt, Kieserite, Gypsum and Magnesium Chloride, is also possible from the Colluli resource. Italy created the colony of Eritrea in the 19th century around Asmara and gave it its current name. Please disable your ad-blocker and refresh. Eritreas north-eastern and eastern parts have an extensive coastline along the Red Sea, strategically located along the Maritime Silk Road. 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 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. In spite of the projected long-term growth of potash demand, the building of new production capacity has been lagging in the past few years, thanks to low potash prices. The relative location of the Colluli resource to these critical markets gives it a significant logistics advantage and unrivalled access to the potash markets of the future. The UN says forced labour and detention without trial are common. It has been a Unesco World Heritage Site since 2017. 3). 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continued new business momentum with another significant award in the mining sector., Your email address will not be published. The Colluli potash project is expected to commence production in 2022. Here Are 10 Other Analyst Forecasts For Tuesday, Berenberg Bank Sticks to Their Buy Rating for Nutrien (NTR), Registration on or use of this site constitutes acceptance of our. My References:Danakali Ltd:https://www.danakali.com.au/ Interested in supporting this channel: Paypal: PayPal . Colluli Potash Project, Eritrea. The open-cut, high-grade potash project is being developed by Colluli Mining Share Company (CMSC), a 50:50 joint venture partnership between Australia's Danakali and Eritrean National Mining Corporation (ENAMCO). 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. growth and decent work, industry, innovation and infrastructure, reduced Development Goals (SDGs). (5) a community of investors to bounce off ideas and share information with. region, chief executive Niels Wagetold MINING.COM last year. Eritreas north-eastern and eastern parts have an extensive coastline along the Red Sea, strategically located along the Maritime Silk Road. / Danakali: Colluli Potash Mining Project Eritrea of Eritrea and Ethiopia, which officially declared peace in July 2018. The Australian company Danakali is developing the Colluli potash project in Eritrea and expects to bring it into production in 2022. In November 2020, a conflict broke out in the mountainous region of Ethiopia, called Tigray, between Tigrayan forces and the Ethiopian federal troops. It also said that all vendor and contractor packages have now been received. Open-cut mining is a proven mining method for salts, and its safer and more cost-effective than underground mining which allows for better overall resource recovery. Image courtesy of Danakali. Installation of an export terminal at Anfile Bay would decrease the length of the land transport route from 230 to only 87 km, thus further lowering the logistics costs required to satisfy the multi-commodity trade in and out of Eritrea. Demand for fertiliser is driven by population and economic growth which directly translates to food demand. I have no business relationship with any company whose stock is mentioned in this article. function googleTranslateElementInit2() {new google.translate.TranslateElement({pageLanguage: 'en',autoDisplay: false}, 'google_translate_element2');} Eritrea's north-eastern and eastern parts have an extensive coastline along the Red Sea, strategically located along the Maritime Silk Road. The development of the Colluli potash projects coincides The report also identified how the mine could help Eritrea second phase of development, as the project has a possible 200-year plus 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 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. Colluli Potash Project is a 50:50 Joint Venture between Danakali Limited and the Eritrean National Mining Company (ENAMCO). RA International to set up camp at Colluli sulphate of potash mine 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. and mag chloride to be commercialized with minimal further processing required. So, as a mining jurisdiction, it has got nothing but ticks in all the right boxes.". Over the past two decades, many hundreds of thousands of Eritreans have fled military conscription and economic uncertainty in their home country and Eritrea has become a major source of migrants and refugees to Europe, in particular to Sweden, Germany and the Netherlands. Analysis of the Potential Contributions of Colluli Potash Project to In 2019, the country received only $67.1m in foreign direct investment (FDI) inflows against $61m in 2018, according to the World Bank. 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. - - | Reverso Context Danakali to cash out of Colluli. mine-life. #google_translate_element2 {display:none!important;} Infrastructure to be developed and upgraded outside the Colluli mining license area includes sea water intake and treatment at Anfile Bay; pipeline and access corridor of 87km between Bay area and the Colluli process plant and the Colluli site road of 57km connecting Colluli to Marsa Fatuma. 2 0 obj endobj If you continue using our website, we'll assume that you are happy to receive all cookies on this website. Table 1. 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. Surface mining allows controlled extraction, predictable production rates and efficient stockpiling of additional economic salts know to us. Visit our privacy policy for more information about our services, how we may use, process and share your personal data, including information on your rights in respect of your personal data and how you can unsubscribe from future marketing communications. The mineralization in the Colluli deposit starts at just 16m, making it the shallowest known potash deposit in the world, and thus amenable to low-cost, open-cut mining. It hosts the youngest evaporite deposit and the largest unexploited potash basin in the world. Value: R 200 Million+. 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. The project has the world's. The project has the worlds largest JORC compliant reserve at 1.1 billion tonnes. This article lost credibility in characterizing the country of Eritrea as most oppressive regime. Fig. 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). The location of the Colluli potash deposit, from this source. To open fire on your own disabled [people] is pretty appalling.". Please. He covered foreign investment in Latin America for 13 years and for the past three years has lived in sub-Saharan Africa and written widely about the subject from that continent's perspective. The Colluli potash mine is estimated to hold 1.1 billion tonnes of SOP ore reserves grading 10.5% potassium oxide (K2O). Colluli is positioned very close to vital potash markets. Masdar City Free Zone, in the United Arab Emirates capital, offers a hassle-free environment in which companies can operate. Adjusted net income of $0.52 beat the consensus estimate of $0.43. Members of The Natural Resources Hub get exclusive ideas and guidance to navigate any climate. On the financial front, a key step was taken last month when Danakali, which has a 50-50 joint venture covering Colluli with the government of Eritrea, signed a $200 million funding mandate. A binding offtake agreement for up to 100% of Module I SOP production, and a US$200M debt financing term sheet have been executed, and all material permits are in place. It also has access to solar, wind and geothermal energy systems - the East African rift. (3) various tools to aid your investment decision making, (4) trade alerts and multiple thematic weekly newsletters and. Foreign investment in most business sectors is heavily restricted and state-owned enterprises distort its markets. "A lot of the troops that he had under his command all of whom were volunteers, all of whom were guerrilla fighters had been fighting, some of them, for 10, 15 years without pay. There is also potential for kieserite and mag chloride to be commercialized with minimal further processing required. Some people have been in national conscription for more than 20 years. Danakali (DNK) - Technical Analysis. Producer of The benefits of this means we generate cash flow much earlier and more predictably relative to solution mining or brine operations. Potash historical demand trends by region, from this source. 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. 86% of retail CFD accounts lose money. Danakali to start developing vast potash project in Eritrea 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. The Colluli project is located in the Danakil Depression region of Eritrea, East Africa, about 75 km from the Red Sea coast. Our services are intended for corporate subscribers and you warrant that the email address submitted is your corporate email address. Danakali (DNK) - Technical Analysis - Crux Investor Invest in t. Colluli has a JORC-2012 compliant measured, indicated and inferred resource of 1,289 Mt at 11% K20 equivalent and 7% kieserite. 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. Mobile data does not exist. function doGTranslate(lang_pair){if(lang_pair.value)lang_pair=lang_pair.value;if(lang_pair=='')return;var lang=lang_pair.split('|')[1];if(GTranslateGetCurrentLang() == null && lang == lang_pair.split('|')[0])return;var teCombo;var sel=document.getElementsByTagName('select');for(var i=0;i Additional details about the agreement are available in the following announcement >>. The project is the only known source of potash that allows extraction of the fertilizer in solid form. Therefore, a wide moat that's rarely seen in miners of other commodities can be found among potash miners, such as Nutrien Ltd (NTR), as discussed by fellow Seeking Alpha authors. Potassium bearing minerals are typically found in areas where ancient inland seas have evaporated leaving behind their minerals. Looking for a helping hand in the market? As inflation falls, what can be expected from the Bank of England in the months to come? Although the total productive life is estimated to be approximately 200 years, the current plan calls for the development of the mine in two stages to support an initial operational life of 60 years. The Colluli project lies in an area that saw detailed geological and geochemical work by USAID and US Geological Survey with the Eritrean Ministry of Mines and Energy. In 2019, it was estimated that the country had a total of 607,900 emigrants, including 217,472 living in Ethiopia, 188,411 in Sudan, 83,600 in Europe and 35,745 in the US, according to Migrants Refugees website. (MOP) and gypsum, along with rock salt. Business intelligence for leaders in foreign direct investment. The project, 50/50 owned by Australian mining company Danakali and the Eritrean Government, is rapidly progressing towards construction. 03 October 2022. Following the agreement, Collulis position as an economically attractive SOP greenfield development project has been reinforced. We have recently upgraded our technology platform. The company expects to start full commercial production in mid-December 2022. Potash reserves among the world's largest - Economist Intelligence Unit There are 70 Subscribers monitoring this project. Muriate of potash, i.e., MOP (KCl; 0-0-60), which is used for wheat, corn, and other chloride-tolerant crops; Sulfate of potash or SOP (K2SO4; 0-0-50-18S), which also supplies both potassium and sulfur for high yields and quality; Potassium-magnesium sulfate, i.e., SOP-M (K2SO4-2MgSO4; 0-0-22-22S-11Mg) used as specialty fertilizer; Potassium thiosulfate (K2S2O3; 0-0-25-17S); and, Potassium nitrate (KNO3; 13-0-44) used for chloride sensitive crops that require additional nitrogen (see. Annual output A two-and-a-half-year border war between Ethiopia and Eritrea ended in June 2000 and was followed by about eight years of heightened tension and hostility between the two countries. Therefore, the Eritrean government has a strong incentive to see the project be built, in production, and run successfully. Colluli is located in the Danakil Depression on the Eritrean side of the Eritrea-Ethiopia border, a barren desert area ideal for large mine operations (Fig. This project has been viewed 588 times. The cost curve of SOP production as of 2018, from the same source as Fig. Send Me Updates. 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. 2). Gensource Potash : Strategic Business Relationship and Project Update, Analysts Are Bullish on Top Materials Stocks: Albemarle (ALB), Nutrien (NTR), DraftKings To Rally Around 38%? In addition to SOP, MOP, and SOP-M producible at Colluli, Danakali can also produce rock salt, kieserite, gypsum, and magnesium chloride, upon the completion of the Anfile Bay port. 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. The proposed mine is located within the Danakil Depression, part of the Great Rift Valley on the Eritrea - Ethiopia border, with export facilities on the Eritrean Red Sea coastline. Development is already underway with expected production in 2022. As part of the agreement with CMSC, owned 50:50 by Danakali and the Eritrean National Mining Corporation, RA will supply, deliver and install a mine accommodation camp as well as a plant administration and service facilities for the Colluli mine site. function GTranslateGetCurrentLang() {var keyValue = document['cookie'].match('(^|;) ?googtrans=([^;]*)(;|$)');return keyValue ? I think you should research about th e author. Under the current FEED study for Module 1 and 2, Danakali will be one of the lowest cost SOP producers and with the development of the loading facility at Anfile Bay costs will decrease further as transportation costs are reduced. 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. Colluli, which Danakali shares with the Eritrean National Mining Corporation, is scoped to produce 472,000 tons a year of potash in sulphate (SOP) in its first phase before scaling up to second phase production of 944,000 tons annually. The asset has the potential to produce other fertilizer The stock chart of Danakali, modified from this source. DRA Global was selected as the engineering, procurement, construction and management (EPCM) contractor for the project in September 2018. development of the project, and the expected significant boost to royalties, 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. 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). 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. These authors includeSilver Coast Research, , among others. All Eritreans are subject to conscription into the military and can be compelled into forced labour that the UN says effectively abuses, exploits and enslaves them for years". Required fields are marked *. 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. Colluli Potash Mine, Danakali Depression, Eritrea, Eastern Africa Select LanguageChinese (Simplified)EnglishGerman In 2023, Botswana expects diamond output to decline by 1%. Colluli - Danakali Limited Fig. 3). Wall Street Bulls Look Optimistic About Nutrien (NTR): Should You Buy? The document estimated that Colluli would contribute 3% of This geographical advantaged is unique. SOP in developing regions where the highest rates of population growth are expected, from. 4. EuroChem is an outstanding partner with global reach and extensive fertiliser capabilities. 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 (. The Colluli resource contains kainitite, sylvinite and carnallitite ores. Construction nears at Colluli potash project following Eritrea ministry There are many sources of potassium, including. 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. Morgan Leighton. document.getElementById( "ak_js_1" ).setAttribute( "value", ( new Date() ).getTime() ); Click to follow this blog and receive notifications of new posts by email. Test work on the Colluli salts has been concluded and the process flow design frozen which indicates the Colluli process using filtered sea water will produce SOP at volumes we expect and at the high-grade spec the world requires. The company is yet to secure an additional US$52 million of capital. According to the article below the mine will require 1,115 workers during the construction phase and 600 thereafter. Danakali explored the use of filtered seawater at Colluli. Installation of an export terminal at Anfile Bay would decrease the length of the land transport route from 230 to only 87 km, thus further lowering the logistics costs required to satisfy the multi-commodity trade in and out of Eritrea. keyValue[2].split('/')[2] : null;} I have no business relationship with any company whose stock is mentioned in this article. 2. The Colluli process is expected to generate a product with a purity of 94.5%. Danakali is developing the tier-1 Colluli potash project, Eritrea, which boasts the world's lowest costs and >200 years of mine life. The miner said it would use the remaining cash about $12 million to identify new projects and potential new alternative growth opportunities.. 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. 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. By clicking the Download Free Whitepaper button, you accept the terms and conditions and acknowledge that your data will be used as described in the Masdar City Free Zone privacy policy Eritrea's potash mining takes shape but questions remain Danakali rates 2022 potash target unlikely as "all options - Miningmx 10). Potash is the common term for fertiliser forms of the element potassium (K). Based on what evidence? Danakali eyes finish line for Eritrea potash project
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