inequalities, climate action, peace, justice and strong institutions and It then plans to distribute 90% of the net proceeds to shareholders and will continue as a listed company to identify new projects and potential new alternative growth opportunities. Despite funding setbacks last year, Danakali says that Colluli, a 50:50 joint venture between Danakali and the Eritrean National Mining Corporation (ENAMCO), is on track for production in 2022. According to the article below the mine will require 1,115 workers during the construction phase and 600 thereafter. It has a geographic area of 117,600km2, making it slightly larger than Bulgaria. taxation and exports, and from jobs and skills and economic development of the The project also involves the construction of a heavy fuel oil-based power plant on-site to meet the electricity requirement. 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. The shortfall of projected and actual global potash capacity, from this source. The above advantageous features combine to make Colluli the lowest-cost SOP producer outside of China (Fig. In food production, potassium is removed from the soil in harvested crops and must be replaced in order to maintain future crop growth. 2. endobj Eritrea Archives - International Mining In comparison, Tessenderlo (OTCPK:TSDOF) and Compass Minerals (CMP) have a P/FCF multiple of 10.0X and 20.9X, respectively. Danakali (DNK) - Technical Analysis. So, as a mining jurisdiction, it has got nothing but ticks in all the right boxes.". Danakali to use filtered sea water at Colluli potash mine 4. 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. 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. . SOP - a premium grade fertilizer - usually grabs a higher price at US$500-650/t (see here). We use them to give you the best experience. Colluli is the premier greenfield development project globally. keyValue[2].split('/')[2] : null;} "In the beginning, things were fine, but gradually it became clear to President Isaias [Afwerki], who led the independence struggle for 30 years, that things were not going the way he expected them to," said Martin Plaut, the former Africa Editor of the BBCs World Service, in an interview in 2019. 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. A comparison of Colluli with vertically-integrated SOP producing competitors, from the same source as Fig. It has had a border war with Ethiopia and a clash along the border with Djibouti. providing 10,000 direct and indirect local jobs. Fertilizer potash is needed in the sustainable production of grains, oilseeds, fruits, and vegetables. Our services are intended for corporate subscribers and you warrant that the email address submitted is your corporate email address. 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 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. Sign up HERE today to benefit from Laurentian Research's in-depth research and the TNRH platform right away! Invest in t. 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). Potash, an important fertiliser, is found in abundance in certain parts of Ethiopia and Eritrea. Colluli has a JORC-2012 compliant Measured, Indicated and Inferred Mineral Resource estimate of 1,289Mt @11% K20. Two articles indicate the rapid progress towards the development of a vast potash mine in the Danakil desert. Profit was boosted by higher metal grades and prices. 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. The decline is mainly due to a drop in production expected at Barrick Gold's Somilo/Gounkoto mine and B2Gold's Fekola mine. Thank you for your comment. World Class Potash Project In Eritrea Moves Closer To Development - Forbes The Colluli potash project is a low-cost, long-life sulphate of potash (SOP) project under development in Eritrea, Eastern Africa. (3) various tools to aid your investment decision making, (4) trade alerts and multiple thematic weekly newsletters and. In turn the well-defined geological features support our ability to maximise the potential from this the multi salt deposit. The deposit is the only one in the world world where SOP can be made from an open-cut mine due to its extreme shallowness. The FEED economic estimates, from the same source as Fig. Flour was awarded the FEED contract for the Colluli potash project in January 2017. Extraction of the salts in solid form is a crucial positive differentiator of Colluli. 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). growth and decent work, industry, innovation and infrastructure, reduced The miner said it would use the remaining cash about $12 million to identify new projects and potential new alternative growth opportunities.. I am not receiving compensation for it (other than from Seeking Alpha). Agnico Eagle's EPS beat expectations; guidance maintained. The front-end engineering and design (FEED) study for the project was completed in January 2018. 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. Over the next three decades, almost 95% of the population growth will occur in Africa, India, and South-East Asia. The Colluli potash project is a low-cost, long-life sulphate of potash (SOP) fertiliser project under development by the Colluli Mining Share Company, a 50-50 joint venture partnership between the Australian start-up Danakali and the Eritrean National Mining Corporation. Potassium bearing minerals are typically found in areas where ancient inland seas have evaporated leaving behind their minerals. stream The owner and developer of the project is the Colluli Mining Share Company (CMSC), a 50:50 joint-venture between Danakali and the Eritrean National Mining Company (ENAMCO). Colluli is positioned very close to vital potash markets. Colluli Potash Project, Danakil - Mining Technology In November 2020, a conflict broke out in the mountainous region of Ethiopia, called Tigray, between Tigrayan forces and the Ethiopian federal troops. Posted by Daniel Gleeson on 21st August 2020. They have significant experience in executing projects of the scale and quality required for the Colluli project. The benefits of this means we generate cash flow much earlier and more predictably relative to solution mining or brine operations. <>/Metadata 306 0 R/ViewerPreferences 307 0 R>> In the initial phase of operation, Wage said, Colluli would development of the project, and the expected significant boost to royalties, 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. 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. <> The company's strategy targets the development of a world-class potash project that will become pivotal for global and African agriculture. RA, listed . 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. Plus500. Are the rights of those working on the site ensured, or will they be slaves forced to work on the mine as National Service conscripts? It also contains other fertilizer products, such as muriate of potash (MOP) and gypsum, along with rock salt. The Company is developing Colluli in partnership with the Eritrean National Mining Corporation (ENAMCO). The Project has unrivalled potash product versatility. 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. Anyone can write a book, as long as is a white person, you would buy it even a white homeless from NYC. Our people is poor continue!!!! Artists impression of the plant at the Colluli project. There is also potential for kieserite and mag chloride to be commercialized with minimal further processing required. In 2023, Botswana expects diamond output to decline by 1%. 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. A United Nations report published in 2019suggested that Colluli could significantly boost the economy of Eritrea. The company is yet to secure an additional US$52 million of capital. Danakali is set to sell its stake in its flagship Colluli potash project in Eritrea for US$121 million. Disclosure: Besides myself, TNRH is fortunate enough to have multiple other contributing authors who post articles for and share their views with our thriving community. 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. Colluli is located in the Danakil Depression . In the initial phase of operations, the mine would produce more than 472,000 tonnes a year of sulphate of potash (SOP), a premium grade fertilizer. The plant administration and services facilities will incorporate administration offices, medical clinic, warehouses, and workshops (see graphic above, credit: RA International). Colluli is 75km from the Red Sea coast, providing unrivalled future logistics potential. Eritrea has a command economy under the control of the sole political party, the People's Front for Democracy and Justice, led by Afwerki. 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. Afwerki's critics accuse him of using the long-standing border dispute with Ethiopia to avoid implementing Eritreas constitution which was ratified in 1997 and for postponing the first scheduled elections (which were also due in 1997). Danakali eyes finish line for Eritrea potash project The Colluli Potash Project is located within the Danakil region of Eritrea, approximately 177km south-east of the capital city Asmara. Previously, in London, he was editor of Investment Adviser and news editor of Financial Adviser, both of which belong to the Financial Times Group, Namibian Investment Promotion and Development Board, Dubais new family office rules can drive economic growth for the UAE, Opinion: New Brexit deal can only be a good thing for Northern Ireland, African FDI into mines on the rise as continent steps up its role in energy transition, How proptech is driving sustainability: Lessons from Stockholm, How Montrals unique agtech community is boosting local food production, EU to launch quest for raw materials critical for cleantech, Finding a cure: How cell and gene therapies could revolutionise medicine, China Shanghai Corporation for Foreign Economic and Technological Cooperation, Norway PESTLE Insights - A Macroeconomic Outlook Report, PESTLE Insights: Macroeconomic Outlook Report - Norway. RA International to set up camp at Colluli sulphate of potash mine 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. This geographical advantaged is unique. US Level 1 ADR's OTC-DNKLY, CUSIP.23585T101 The world's largest JORC compliant solid salt, Sulphate of . Foreign investment in most business sectors is heavily restricted and state-owned enterprises distort its markets. function GTranslateFireEvent(element,event){try{if(document.createEventObject){var evt=document.createEventObject();element.fireEvent('on'+event,evt)}else{var evt=document.createEvent('HTMLEvents');evt.initEvent(event,true,true);element.dispatchEvent(evt)}}catch(e){}} Members of The Natural Resources Hub get exclusive ideas and guidance to navigate any climate. 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. About 55% of the Eritrean population is Tigrinya while 30% is Tigre, but there are a number of other smaller ethnicities including Saho and Kunama. Jason Mitchell is a senior editor at Investment Monitor, with a specialisation in emerging markets. However, in July 2018, a peace agreement was finally reached between Afwerki and Ethiopias Prime Minister, Abiy Ahmed. To lower infrastructure uncertainties, in August and October 2020, respectively, Danakali appointed RA International Group PLC as the preferred contractor for the supply of accommodation, support services, and other infrastructure buildings, and Aggreko (AGK.LSE) as its preferred power supply contractor for its 12MW HFO power plant at Colluli under a five-year BOOT contract, removing a major infrastructure uncertainty. 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). 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.
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