colluli potash project in eritrea 2022

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. DRA Global was selected as the engineering, procurement, construction and management (EPCM) contractor for the project in September 2018. To ensure this doesnt happen in the future, please enable Javascript and cookies in your browser. If you continue using our website, we'll assume that you are happy to receive all cookies on this website. endobj 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. <> 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. This article lost credibility in characterizing the country of Eritrea as most oppressive regime. 6. Commonly, Potash refers to Potassium Chloride or Muriate of Potash (MOP), however, a number of other potash variants exist with premium potash types containing micro-nutrients as well as macro nutrients such as potassium sulphate, potassium magnesium sulphate and potassium nitrate. 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. The company is yet to secure an additional US$52 million of capital. In 2019, the country received only $67.1m in foreign direct investment (FDI) inflows against $61m in 2018, according to the World Bank. I bought many shares @ 67 Cents per share, total of 240.000.00 Now the share is under 20 Cents. with the move towards diplomatic relations between the once feuding countries The Colluli potash project is expected to commence production in 2022. The Company is developing Colluli in partnership with the Eritrean National Mining Corporation (ENAMCO). In June 2018, Danakali reached a binding take-or-pay offtake agreement with EuroChem Trading GmbH (EuroChem). The Colluli Potash Project (Project, Colluli ) is 100%. The project has been largely derisked with regard to geopolitics, infrastructure, off-take, and financing. 4 0 obj Colluli Potash Project, Eritrea. The Colluli potash mine is estimated to hold 1.1 billion tonnes of SOP ore reserves grading 10.5% potassium oxide (K2O). Pilot tests from the Colluli salts have generated product samples for marketing purposes which are now being distributed to prospective customers. Fig. 3. Eritrea's north-eastern and eastern parts have an extensive coastline along the Red Sea, strategically located along the Maritime Silk Road. 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. The Eritrean government, through ENAMCO, has a 50% interest in the Colluli project. Fig. region, chief executive Niels Wagetold MINING.COM last year. With planned production of 1m tonnes/year of SOP, it will put Eritrea among the topten potash producers in the world. In 2023, Botswana expects diamond output to decline by 1%. You are talking about the garbage written by Plaut ? 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. 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. Italy created the colony of Eritrea in the 19th century around Asmara and gave it its current name. Some 7 Mt of potash capacity as being forecasted back in 2015 has been removed from the supply side (Fig. Your email address will not be published. Shallowest known evaporite deposit globally. Enter your email below to receive updates on your featured companies right to your inbox. Artists impression of the plant at the Colluli project. Danakali has a 50% interest in a JV with the Eritrean National Mining Corporation (or ENAMCO), which operates the Colluli project. Colluli is located about 75 kilometres from the Red Sea coast, making it among the most accessible premium potash deposits globally. 4. They have significant experience in executing projects of the scale and quality required for the Colluli project. So, as a mining jurisdiction, it has got nothing but ticks in all the right boxes.". My References:Danakali Ltd:https://www.danakali.com.au/ Interested in supporting this channel: Paypal: PayPal . Eritrea had been under UN sanction per Security Council Resolution 1907 since December 23, 2009, for the government's role in aiding Al-Shabaab in Somalia and refusing to withdraw troops from its disputed border with Djibouti following a conflict in 2008. 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. According to the UNDP report entitled "Analysis of the potential contribution of Colluli potash project to sustainable development goals in Eritrea," Colluli is estimated to attract US$614 million of direct capital investment, generate 3% of Eritrean GDP once module I is up running, and account for 50% of Eritrean Exports by when module II is on stream. 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 (. Only 12% of the total land area is suitable for farming in part due to the countrys rocky and mountainous terrain but also due to a persistent drought that afflicts much of the remaining countryside. The stock seems to be agitating for a breakout in recent weeks (Fig. 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). 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 Danakil Depression is an emerging potash province in Eritrea and Ethiopia. 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. This geographical advantaged is unique. According to Reporters Without Borders, only North Korea has less press freedom. 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. The country also boasts impressive marine tourist sites, a wide range of flora and fauna, and scenic terrain. Information about Eritrea and the Horn of Africa. Finance > M-a. Send Me Updates. 2023 Glacier Media Group, All Rights Reserved, selling its 50% stake in the Colluli potash project, Botswana mining growth seen flat amid dim diamond outlook, Harmony Gold CEO says gold sector consolidation inevitable, BHP seeks to tighten grip on South Americas copper sector, Quest for worlds biggest diamonds gives De Beers a headache, https://www.hrw.org/world-report/2021/country-chapters/eritrea, https://www.dandc.eu/en/article/how-government-eritrea-became-one-worlds-most-repressive-regimes, https://www.hurstpublishers.com/book/understanding-eritrea-2/, 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. There are many sources of potassium, including. and mag chloride to be commercialized with minimal further processing required. 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 Australian company Danakali is developing the Colluli potash project in Eritrea and expects to bring it into production in 2022. Our 3 Top Picks. Some people have been in national conscription for more than 20 years. Fig. In July, the Eritrean Ministry of Energy & Mines paved the way for construction to start at the project after accepting the Colluli Notice of Commencement of Mine Development. 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. The report also identified how the mine could help Eritrea Earth Moving Worldwide (EMW) was selected to provide mining services for the Colluli potash project in December 2019. The UN says forced labour and detention without trial are common. 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. 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). 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. I have taken a starter position and plan to build a position of meaningful size in the next couple of years. 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 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. However, in July 2018, a peace agreement was finally reached between Afwerki and Ethiopias Prime Minister, Abiy Ahmed. 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. 3). 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. 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. Therefore, the Eritrean government has a strong incentive to see the project be built, in production, and run successfully. 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. Additionally, it will provide comprehensive camp services incorporating catering, cleaning, laundry, pest and vector control, grounds keeping and waste management. The Perth-basedminer noted that despite covid-19 restrictions, engineering, procurement and construction management (EPCM) activities have continued as scheduled. In the sprawling mining sector, potash mining is unique in that potash mines typically last decades to even centuries, thus forcing the miners to deploy capital for the long-term return, and that transportation of bulk-tonnage potash tends to lead to regional monopolies. It assesses a wide range of econometric data and includes findings . It has a Human Development Index of 0.42, which puts it among the ten least-developed countries on the planet. 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. A number of unique characteristics make Colluli one of the world's largest and lowest-cost deposits of SOP. The asset has the potential to produce other fertilizer As a tier-1 potash deposit with a number of unique advantages to its favor, the fully-permitted Colluli carries little underground geological risk. 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, [email protected], +44 (0) 20 7406 6613. It also has access to solar, wind and geothermal energy systems the East African rift. Eritrea has a command economy under the control of the sole political party, the People's Front for Democracy and Justice, led by Afwerki. "There is a supportive business environment because mining there is a very strategic industry. 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. The project, 50/50 owned by Australian mining company Danakali and the Eritrean Government, is rapidly progressing towards construction. 5. 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. Colluli is located in the Danakil Depression region of Eritrea and is approximately 230km by road southeast of the port of Massawa, which is Eritrea's key import/export facility. 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. Climate Change and its Impact on Insurance Market - Thematic Ukraine PESTLE Insights - A Macroeconomic Outlook Report, Germany PESTLE Insights - A Macroeconomic Outlook Report. 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. He is one of the world's most brutal and paranoid dictators and has repressed the population for many decades. Value: R 200 Million+. The Colluli project requires low upfront development costs and is highly scalable for long-life production. Potash historical demand trends by region, from this source. Colluli is without peer on capital intensity and production capacity with the ability to expand rapidly. Required fields are marked *. This long-lasting tension has led to Eritrea's militarisation. The SOP quality spectrum, from the same source as Fig. These authors includeSilver Coast Research, , among others. Eritrea has managed to fall out with and then mend fences with every one of its neighbouring countries. What are the best countries for cryptocurrency adoption? 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. 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. Potash is an important fertiliser. SOP - a premium grade fertilizer - usually grabs a higher price at US$500-650/t (see here). 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. Analysis of the potential contribution of Colluli potash project to sustainable development goals in Eritrea. It is estimated to have about 80,000 archaeological sites. 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. growth and decent work, industry, innovation and infrastructure, reduced I have no business relationship with any company whose stock is mentioned in this article.

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