It nosedived again in 2017, this time by -10%, before jumping by 13% in 2018. The 600 person camp capacity is exclusive of camp services personnel, which will have an additional camp, provided by RA, located within the overall camp boundary. These authors includeSilver Coast Research, , among others. . The Perth-basedminer noted that despite covid-19 restrictions, engineering, procurement and construction management (EPCM) activities have continued as scheduled. 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). My References:Danakali Ltd:https://www.danakali.com.au/ Interested in supporting this channel: Paypal: PayPal . 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). function googleTranslateElementInit2() {new google.translate.TranslateElement({pageLanguage: 'en',autoDisplay: false}, 'google_translate_element2');} The Colluli potash project is considered one of the world's most significant and lowest-cost sources of sulphate of potash (SOP), a premium grade fertilizer. Danakali is developing the tier-1 Colluli potash project, Eritrea, which boasts the world's lowest costs and >200 years of mine life. Plus500. Mobile data does not exist. #goog-gt-tt {display:none !important;} It has a Human Development Index of 0.42, which puts it among the ten least-developed countries on the planet. Danakali (ASX: DNK) is the 50% owner of the Colluli Potash Project located in Eritrea. Reverso Context-: Jason Mitchell is a senior editor at Investment Monitor, with a specialisation in emerging markets. 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 proximity to the coast and the established port infrastructure in the Port of Massawa gives Colluli unrivalled access to global export markets, and it also decreases logistics costs from the mine gate onto the ship estimated at US$73/t. In turn the well-defined geological features support our ability to maximise the potential from this the multi salt deposit. Fig. This long-lasting tension has led to Eritrea's militarisation. Based on what evidence? The production of other agricultural and salt products, including Rock Salt, Kieserite, Gypsum and Magnesium Chloride, is also possible from the Colluli resource. What Are the Best Fertilizer Stocks? 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. 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. Adjusted net income of $0.52 beat the consensus estimate of $0.43. With planned production of 1m tonnes/year of SOP, it will put Eritrea among the topten potash producers in the world. The Colluli Potash Project is located within the Danakil region of Eritrea, approximately 177km south-east of the capital city Asmara. The miner said it would use the remaining cash about $12 million to identify new projects and potential new alternative growth opportunities.. Please disable your ad-blocker and refresh. 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 . Surface mining allows controlled extraction, predictable production rates and efficient stockpiling of additional economic salts know to us. 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. providing 10,000 direct and indirect local jobs. These alternative producers require substantial lead times to generate their harvest salts for processing. The west really needs to let go of calling every developing nation that doesnt bend at its will oppressive. But when [Afwerki] discovers that his authority is being questioned after independence, he begins reacting in the same way. Extraction of the salts in solid form is a crucial positive differentiator of Colluli. Development is already underway with expected production in 2022. Colluli is positioned very close to vital potash markets. Copyright 2023, All Rights Reserved | Alphastox | Proudly Hosted by, Danakali to sell stake in flagship Colluli potash project in Eritrea, Canada Nickel develops new method for accelerated carbon capture, Patriot Battery Metals drills nine holes at Corvette, Metso Outotec expands digital grinding inspections with acquisition of Global Physical, Fatal accident at Ivanhoes Kamoa-Kakula mine in Congo. and then onto production in 2022, Danakali said. Demand for fertiliser is driven by population and economic growth which directly translates to food demand. Image courtesy of Danakali. 5. Earth Moving Worldwide (EMW) was selected to provide mining services for the Colluli potash project in December 2019. There are many sources of potassium, including. 6. 6. EuroChem will purchase the entire SOP output of the Colluli phase one potash project under a 10-year binding off-take agreement signed in June 2018. Foreign investment in most business sectors is heavily restricted and state-owned enterprises distort its markets. Eritrea was, until 2018, on the UNs sanctions list. Fig. Have the local Afar people been displaced and supplies to their communities cut to allow access to the site? The government will benefit from the longer-term To open fire on your own disabled [people] is pretty appalling.". Fig. We are confident in RA Internationals capabilities to deliver a high-quality product and service.. However, the country is home to one of the world's biggest potash deposits which straddles the border with Ethiopia. Danakali is just one of many deep-value natural resources ideas covered by Laurentian Research. it is promising future.for our country and people .Thank God. Finance > M-a. The Company is developing Colluli in partnership with the Eritrean National Mining Corporation (ENAMCO). The underapplication of SOP in developing regions where the highest rates of population growth are expected, from this source. One of the essential benefits of having the salts in solid form is that it takes between 2-3 weeks to mine, process and transport our SOP to Massawa Port. 1 0 obj The deposit stretches across the border into Ethiopia. There is also potential for kieserite and mag chloride to be commercialized with minimal further processing required. I am not receiving compensation for it (other than from Seeking Alpha). 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. 4). 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. In June 2018, Danakali reached a binding take-or-pay offtake agreement with EuroChem Trading GmbH (EuroChem). World potash demand has grown at an average rate of 2.5-3.0% per year since 2000 (Fig. The project, 50/50 owned by Australian mining company Danakali and the Eritrean Government, is rapidly progressing towards construction. The proximity to the coast and the established port infrastructure in the Port of Massawa gives Colluli unrivalled access to global export markets, and it also decreases logistics costs from the mine gate onto the ship. endobj The Colluli potash mine is estimated to hold 1.1 billion tonnes of SOP ore reserves grading 10.5% potassium oxide (K2O). 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. 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. Please. MiningOther CommoditiesIndustrial Minerals, Danakali (50%) and Eritrean National Mining Corporation (ENAMCO, 50%). 6. These circumstances have resulted in it becoming one of the most isolated states in the world. The Report was undertaken during 2018 by senior economists on behalf of the UNDP. 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. Fig. The Danakil Depression is located in the Southern region of Eritrea and extends over 300km into Eastern Ethiopia. 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? with the move towards diplomatic relations between the once feuding countries 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. To ensure this doesnt happen in the future, please enable Javascript and cookies in your browser. 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. Colluli has a JORC-2012 compliant Measured, Indicated and Inferred Mineral Resource estimate of 1,289Mt @11% K20. Eritrea is bordered by Sudan in the west, Ethiopia in the south and Djibouti in the south-east, and it has a 1,150km coastline along the Red Sea. The front-end engineering design (FEED), expected to be 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. The decline is mainly due to a drop in production expected at Barrick Gold's Somilo/Gounkoto mine and B2Gold's Fekola mine. document.getElementById( "ak_js_1" ).setAttribute( "value", ( new Date() ).getTime() ); Click to follow this blog and receive notifications of new posts by email. could rise to almost 944,000 tonnes if Danakali decides to go ahead with a .goog-te-banner-frame {display:none !important;} Agnico Eagle's EPS beat expectations; guidance maintained. Italy created the colony of Eritrea in the 19th century around Asmara and gave it its current name. GDP dropped by -0.6% in 2020 in the wake of the Covid-19 pandemic and a locust invasion. A port development at Anfile Bay could assist in unlocking this potential. The company is yet to secure an additional US$52 million of capital. 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. The asset has the potential to produce other fertilizer 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. Colluli is located about 75 kilometres from the Red Sea coast, making it among the most accessible premium potash deposits globally. The Danakil Depression, which extends over 300km into eastern Ethiopia, hosts over 6,000 Mt of potassium-bearing salts suitable for the production of potash fertilizers. The project has been largely derisked with regard to geopolitics, infrastructure, off-take, and financing. Proudly Researched by: Melanie Miles. With mineralisation commencing at just 16m, the Colluli resource is the shallowest known evaporite deposit globally and is amenable to open-cut mining. 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). A number of unique characteristics make Colluli one of the world's largest and lowest-cost deposits of SOP. On July 9, 2018, a joint declaration of peace and friendship was signed between Eritrea and Ethiopia. Potash products including SOP, MOP, and SOP-M all have the potential to be produced at Colluli. 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. 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. 9. Colluli, furthermore, boasts the shallowest evaporite mineralisation globally and consequently has significant mining, logistics and, in turn, capital and operating cost benefits over other potash development projects in the Danakil Depression and elsewhere. Colluli will be a simple open-cut mining operation utilising truck and shovel methods complemented by continuous surface miners. 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). <> It also said that all vendor and contractor packages have now been received. In the long run, potash consumption is expected to continue to grow as a result of population expansion. <>/Metadata 306 0 R/ViewerPreferences 307 0 R>> 11). 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. It also has access to solar, wind and geothermal energy systems the East African rift. The total measured, indicated, and inferred SOP mineral resources at the deposit are estimated to be 1.29 billion tonnes grading 11% K2O. A United Nations report published in 2019suggested that Colluli could significantly boost the economy of Eritrea. Reminders. 2022 The Colluli potash project is a low-cost, long-life sulphate of potash (SOP) project under development in Eritrea, Eastern Africa. 3). Sylvinite and carnallitite both produce potassium chloride, which is then combined with decomposed kainitite to form high purity potassium sulphate. According to the article below the mine will require 1,115 workers during the construction phase and 600 thereafter. Economic resources for Sulphate of Potash (SOP) production are scarce, and Colluli is favourably positioned to supply the worlds fastest-growing SOP markets. 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. Fig. #google_translate_element2 {display:none!important;} 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. DANAKALI focuses on developing the Colluli potash project in Eritrea, which is wholly owned by Colluli Mining Share Company . The report also identified how the mine could help Eritrea (. Niels Wage, CEO of Danakali, said: "We are very pleased to announce the appointment of Aggreko as our single power provider. 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. 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 project will be developed in multi-modules, with Module I serving as a platform for future growth. Danakali is developing the tier-1 Colluli potash project, Eritrea, which boasts the world's lowest costs and >200 years of mine life. 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. However, in July 2018, a peace agreement was finally reached between Afwerki and Ethiopias Prime Minister, Abiy Ahmed. (. 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 company has completed a front-end engineering design for the production of potassium sulphate, otherwise known as sulphate of potash or SOP. I wrote this article myself, and it expresses my own opinions. A United Nations report published in 2019 suggested that Colluli could significantly boost the economy of Eritrea. 10. (as referred to in ASX announcements of 3 October 2022, 1 December 2022, and 12 January 2023), it . 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). 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 front-end engineering and design (FEED) study for the project was completed in January 2018. Information about Eritrea and the Horn of Africa. 3. All primary production of potassium sulphate from kainitite worldwide commence with low potassium content brines, which require substantial solar evaporation to generate a harvest salt for subsequent processing. Enter your email below to receive updates on your featured companies right to your inbox. Profit was boosted by higher metal grades and prices. Our people is poor continue!!!! 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. It also has access to solar, wind and geothermal energy systems the East African rift. 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. The country only has one preferential trade agreement in force (with Italy) and is not a member of the World Trade Organisation. 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). Click HERE for a free trial now. seriously, this Man is a lobbyist of TPLF A group designated as a Terrorist Organisation in Ethiopia. (MOP) and gypsum, along with rock salt. In August 2019, Danakali announced Africa Finance Corporation and African Export-Import Bank (Afreximbank) have obtained formal credit approval to provide US$200 million in senior debt finance, as part of the overall project funding package used for the construction of Colluli, with the documentation finalized on December 23, 2019. Additionally, it will provide comprehensive camp services incorporating catering, cleaning, laundry, pest and vector control, grounds keeping and waste management. As a tier-1 potash deposit with a number of unique advantages to its favor, the fully-permitted Colluli carries little underground geological risk. It has industry-leading capital intensity, forecast first quartile operating costs, and highly attractive economic returns. In 2023, Botswana expects diamond output to decline by 1%. 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. Danakali is set to sell its stake in its flagship Colluli potash project in Eritrea for US$121 million. SOP in developing regions where the highest rates of population growth are expected, from. Danakali has reported a 1.1 billion ore reserve with a mine life of almost 200 years. Eritreas north-eastern and eastern parts have an extensive coastline along the Red Sea, strategically located along the Maritime Silk Road. 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 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. Members of The Natural Resources Hub get exclusive ideas and guidance to navigate any climate. 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. There are 70 Subscribers monitoring this project. Eritrea has huge tourism potential, but it is hard for foreign visitors to obtain a visa. 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. US Level 1 ADR . 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. Fertilizer potash is needed in the sustainable production of grains, oilseeds, fruits, and vegetables. Fig. If you continue using our website, we'll assume that you are happy to receive all cookies on this website. 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. Below, let's look at Danakali Ltd. (DNK.ASX) (OTCPK:SBMSF) (OTCPK:DNKLY), which operates in Eritrea. Notify me of follow-up comments by email. 2 0 obj The above advantageous features combine to make Colluli the lowest-cost SOP producer outside of China (Fig. 86% of retail CFD accounts lose money. Colluli is located about 75 kilometres from the Red Sea coast, making it among the most accessible premium potash deposits globally. This is a report that was prepared by independent consultants and initiated and funded by the United Nations Development Programme (UNDP) on the potential contributions of Colluli to Eritrea's Sustainable Development Goals has been released. Danakali Limited is a resource company focused on the Colluli SOP (Sulphate of Potash) Project in Eritrea, East Africa. 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. The removal of Eritrea from the sanction list opened up the country for foreign investments, thus significantly reducing geopolitical risk. Its constitution has not been implemented, the parliament has been prorogued for many years, the ruling party has not held a congress for a number of years and independent media is banned. 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. 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. 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. In 2019, the country received only $67.1m in foreign direct investment (FDI) inflows against $61m in 2018, according to the World Bank. 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. Eritrea has managed to fall out with and then mend fences with every one of its neighbouring countries. Prime Minister Abiy Ahmed accused the Tigrayans of attacking a military camp and attempting to loot military assets. It also provides off-takers with additional confidence on Project certainty and fundability, supporting the finalisation of binding bankable offtake agreements. I recommend a book by Martin Plaut, a senior researcher at Londons Institute of Commonwealth Studies and former Africa Editor of the BBCs World Service called Understanding Eritrea: Inside Africas Most Repressive State (https://www.hurstpublishers.com/book/understanding-eritrea-2/). The Colluli project is located in the Danakil Depression region of Eritrea, East Africa, about 75 km from the Red Sea coast The Perth-based miner noted that despite covid-19 restrictions,.
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