Journalists say that getting any information out of the country is extremely difficult. Potassium bearing minerals are typically found in areas where ancient inland seas have evaporated leaving behind their minerals. .goog-te-banner-frame {display:none !important;} Shallowest known evaporite deposit globally. could rise to almost 944,000 tonnes if Danakali decides to go ahead with a The company expects to start full commercial production in mid-December 2022. 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. inequalities, climate action, peace, justice and strong institutions and Reminders. 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. The country only has one preferential trade agreement in force (with Italy) and is not a member of the World Trade Organisation. The production of other agricultural and salt products, including Rock Salt, Kieserite, Gypsum and Magnesium Chloride, is also possible from the Colluli resource. Danakali Limited is a resource company focused on the Colluli SOP (Sulphate of Potash) Project in Eritrea, East Africa. 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. DANAKALI focuses on developing the Colluli potash project in Eritrea, which is wholly owned by Colluli Mining Share Company . endobj 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. Your email address will not be published. <>/ExtGState<>/Font<>/ProcSet[/PDF/Text/ImageB/ImageC/ImageI] >>/MediaBox[ 0 0 594.96 842.04] /Contents 4 0 R/Group<>/Tabs/S/StructParents 0>> MiningOther CommoditiesIndustrial Minerals, Danakali (50%) and Eritrean National Mining Corporation (ENAMCO, 50%). Internal industry and services contribute the majority of the remaining GDP, while agriculture accounts for only 13% (despite employing 80% of the population). finished in June, will take the company a step closer to the construction phase Colluli Potash Project is a 50:50 Joint Venture between Danakali Limited and the Eritrean National Mining Company (ENAMCO). 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. The construction works for the Colluli potash mine are expected to be started in 2021 with the start of production expected in 2022. 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. At a SOP price of US$650/tonne, annual production would generate revenue equivalent to . 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 port development at Anfile Bay could assist in unlocking this potential. stream Danakali explored the use of filtered seawater at Colluli. Apart from SOP, the salt composition at the deposit also allows for the production of other potash products including sulphate of potash-magnesia (SOP-M) and muriate of potash (MOP). Australia's Danakali (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. There is also potential for kieserite and mag chloride to be commercialized with minimal further processing required. It also contains other fertilizer products, such as muriate of potash (MOP) and gypsum, along with rock salt. Italy created the colony of Eritrea in the 19th century around Asmara and gave it its current name. The cost curve of SOP production as of 2018, from the same source as Fig. The Colluli potash project is expected to commence production in 2022. In some cases, depending on the ambient conditions, this process can take over two years. Below, let's look at Danakali Ltd. (DNK.ASX) (OTCPK:SBMSF) (OTCPK:DNKLY), which operates in Eritrea. 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. In the long run, potash consumption is expected to continue to grow as a result of population expansion. In turn the well-defined geological features support our ability to maximise the potential from this the multi salt deposit. Colluli is located in the Danakil Depression . Colluli is obviously a tier-1 asset, boasting the lowest-costs in the world and >200 years of mine life. The Danakil Depression is located in the Southern region of Eritrea and extends over 300km into Eastern Ethiopia. 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 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. 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. Eritrea has one of the world's most brutal dictatorships, but could a huge potash mine be an economic game changer? 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. He is one of the world's most brutal and paranoid dictators and has repressed the population for many decades. Eritrea has huge tourism potential, but it is hard for foreign visitors to obtain a visa. They are in deep need. My References:Danakali Ltd:https://www.danakali.com.au/ Interested in supporting this channel: Paypal: PayPal . This article lost credibility in characterizing the country of Eritrea as most oppressive regime. What are my chances of getting my money back? Posted by Daniel Gleeson on 21st August 2020. Colluli, owned 50:50 by Danakali and the Eritrean National Mining Corporation, has a JORC-2012 compliant measured, indicated and inferred resource of 1,289 Mt at 11% K20 equivalent and 7% kieserite. 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% . It assesses a wide range of econometric data and includes findings . 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. It is actually resistant to the wests oppression in the most pure sense of the term. ,and the value is around 67,000.00 . This post has been syndicated from a third-party source. Therefore, the Eritrean government has a strong incentive to see the project be built, in production, and run successfully. It also provides off-takers with additional confidence on Project certainty and fundability, supporting the finalisation of binding bankable offtake agreements. The report also identified how the mine could help Eritrea The decline is mainly due to a drop in production expected at Barrick Gold's Somilo/Gounkoto mine and B2Gold's Fekola mine. The shortfall of projected and actual global potash capacity, from this source. There is also potential for kieserite and mag chloride to be commercialized with minimal further processing required. A United Nations reportpublished last yearsuggested that Colluli could significantly boost Eritreas economy. The project has the worlds largest JORC compliant reserve at 1.1 billion tonnes. What Are the Best Fertilizer Stocks? I am not receiving compensation for it (other than from Seeking Alpha). The mine will put Eritrea among the top ten potash producers in the world and impact the global supply chain of high-quality fertiliser. The SOP quality spectrum, from the same source as Fig. 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 analysis of direct impacts of Colluli potash project and its potential contributions to the sustainable development agenda in Eritrea is focused on five main areas," the report states. A number of unique characteristics make Colluli one of the world's largest and lowest-cost deposits of SOP. Due to this change if you are seeing this message for the first time please make sure you reset your password using the Forgot your password Link. 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). You are talking about the garbage written by Plaut ? The country also has 486,200 refugees, including 123,413 living in Sudan, 172,750 in Ethiopia and 18,976 in Egypt. Fig. 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. Invest in t. 10. It thus follows we should keep an eye on emerging potash producers. I have taken a starter position and plan to build a position of meaningful size in the next couple of years. 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. Climate Change and its Impact on Insurance Market - Thematic Ukraine PESTLE Insights - A Macroeconomic Outlook Report, Germany PESTLE Insights - A Macroeconomic Outlook Report. 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). Image courtesy of Danakali. Fig. I'd like to emphasize that the articles contributed by these authors are the product of their respective independent research and analysis. The Danakil Depression is an emerging potash province in Eritrea and Ethiopia. Some 7 Mt of potash capacity as being forecasted back in 2015 has been removed from the supply side (Fig. 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. By. Simplified process flow for the production of SOP from the Colluli resource, from this source. Information about Eritrea and the Horn of Africa. and mag chloride to be commercialized with minimal further processing required. Image courtesy of Danakali. Danakali has a 50% interest in a JV with the Eritrean National Mining Corporation (or ENAMCO), which operates the Colluli project. 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. Discover how your business could benefit from a base in Masdar Citys economic free zone, download this free whitepaper. 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. endobj 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. 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. The underapplication of SOP in developing regions where the highest rates of population growth are expected, from this source. The United Nations Development Programme (UNDP) has indicated Colluli has the potential to significantly boost the Eritrean economy and have a substantial positive impact on the Sustainable Development Agenda of Eritrea. The Colluli potash project is a low-cost, long-life sulphate of potash (SOP) project under development in Eritrea, Eastern Africa. 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. 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. 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. providing 10,000 direct and indirect local jobs. It has had a border war with Ethiopia and a clash along the border with Djibouti. Eritrea one of the worlds most repressive and secretive states, known as the North Korea of Africa is poised to disrupt the global supply chain of fertiliser. In November 2020, a conflict broke out in the mountainous region of Ethiopia, called Tigray, between Tigrayan forces and the Ethiopian federal troops. 5. 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. "There is a supportive business environment because mining there is a very strategic industry. The company is yet to secure an additional US$52 million of capital. The Project has unrivalled potash product versatility. 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. Potash products including SOP, MOP, and SOP-M all have the potential to be produced at Colluli. The border lands mostly arable are unusable for farming purposes, because of unexploded land mines left over from the war of independence. The Australian company Danakali is developing the Colluli potash project in Eritrea and expects to bring it into production in 2022. 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. The above advantageous features combine to make Colluli the lowest-cost SOP producer outside of China (Fig. The Report was undertaken during 2018 by senior economists on behalf of the UNDP. 6. With planned production of 1m tonnes/year of SOP, it will put Eritrea among the topten potash producers in the world. However, the country is home to one of the world's biggest potash deposits which straddles the border with Ethiopia. Colluli has significant multi-commodity potential presenting major additional value upside. "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. Fig. 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,. 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. Potash, an important fertiliser, is found in abundance in certain parts of Ethiopia and Eritrea. 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. These circumstances have resulted in it becoming one of the most isolated states in the world. 6. The Colluli process is expected to generate a product with a purity of 94.5%. 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. A Front-End Engineering Design (FEED) study confirmed an advanced stage and economically attractive Project. Eritreas north-eastern and eastern parts have an extensive coastline along the Red Sea, strategically located along the Maritime Silk Road. Fertiliser is a key component to ensure world food security in the future. I am not receiving compensation for it (other than from Seeking Alpha). . 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. It also contains other fertilizer products, such as muriate of potash (MOP) and gypsum, along with rock salt. BHP officials met with Argentinian authorities this week, expressing interest in increasing investments in the San Juan province. 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. A comparison of Colluli with vertically-integrated SOP producing competitors, from the same source as Fig. As a tier-1 potash deposit with a number of unique advantages to its favor, the fully-permitted Colluli carries little underground geological risk. 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. However, in July 2018, a peace agreement was finally reached between Afwerki and Ethiopias Prime Minister, Abiy Ahmed. 2022 The Colluli potash project is a low-cost, long-life sulphate of potash (SOP) project under development in Eritrea, Eastern Africa. The project is the only known source of potash that allows extraction of the fertilizer in solid form. Value: R 200 Million+. With mineralisation commencing at just 16m, the Colluli resource is the shallowest known evaporite deposit globally and is amenable to open-cut mining. The Colluli Potash Project is located within the Danakil region of Eritrea, approximately 177km south-east of the capital city Asmara. (5) a community of investors to bounce off ideas and share information with. I have no business relationship with any company whose stock is mentioned in this article. The total measured, indicated, and inferred SOP mineral resources at the deposit are estimated to be 1.29 billion tonnes grading 11% K2O. "We have found Eritrea to be very transparent and consistent across the board," Seamus Cornelius, Danakali's executive chairman, said in an interview. Danakali to cash out of Colluli. Unlike North Korea, China or Iran, social media is mostly unregulated, but the biggest problem is access to the internet, which is unreliable and expensive. The front-end engineering design (FEED), expected to be Fig. 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. 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 resource contains kainitite, sylvinite and carnallitite ores. The total measured, indicated and inferred SOP mineral resources at the deposit are estimated to be 1.29 billion tonnes grading 11% K2O. Colluli contains three potassium-bearing salts in solid form, namely. development of the project, and the expected significant boost to royalties, 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. Disclosure: I am/we are long SBMSF, CMP. 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? Open-cut solid salt mining beats underground solid salt mining, lacustrine brine, and playa brine in operating costs. 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. Our people is poor continue!!!! 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. Eritrea has managed to fall out with and then mend fences with every one of its neighbouring countries. Danakali is just one of many deep-value natural resources ideas covered by Laurentian Research. The Colluli project is located in the Danakil Depression region of Eritrea, East Africa, about 75 km from the Red Sea coast. Masdar City Free Zone, in the United Arab Emirates capital, offers a hassle-free environment in which companies can operate. 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. Development Goals (SDGs). it is promising future.for our country and people .Thank God. Over 100kg of Colluli product was tested at Ludman Industries in the USA for product compaction behaviour. Why isn't Europe investing more in recycling plastic. 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. 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. of Eritrea and Ethiopia, which officially declared peace in July 2018. 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). 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 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. 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. There are many sources of potassium, including. 6. Eritreas 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 Colluli is without peer on capital intensity and production capacity with the ability to expand rapidly. But when [Afwerki] discovers that his authority is being questioned after independence, he begins reacting in the same way.
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