If you continue using our website, we'll assume that you are happy to receive all cookies on this website. The decline is mainly due to a drop in production expected at Barrick Gold's Somilo/Gounkoto mine and B2Gold's Fekola mine. Danakali to cash out of Colluli. 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. As inflation falls, what can be expected from the Bank of England in the months to come? 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. As the commodity supercycle unfolds, you are invited to join The Natural Resources Hub today to take advantage of a slew of generational opportunities alongside Laurentian Research. Required fields are marked *. 2 0 obj Therefore, the Eritrean government has a strong incentive to see the project be built, in production, and run successfully. . education, gender equality, clean water and sanitation, sustainable economic Reminders. The project has the worlds largest JORC compliant reserve at 1.1 billion tonnes. 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. 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. 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. 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 (. and then onto production in 2022, Danakali said. 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. as being forecasted back in 2015 has been removed from the supply side (Fig. 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. In July 2013, major producer Belaruskali broke up with former Belarusian Potash Company cartel partner Uralkali, and in a move to grab market share, signed a potash sales contract for the Chinese market at US$315/t MOP. It also contains other fertilizer products, such as muriate of potash (MOP) and gypsum, along with rock salt. I have no business relationship with any company whose stock is mentioned in this article. After the Second World War, it was annexed to Ethiopia. Eritrea has historically struggled to attract large investments because of its unfavourable business climate. The cost curve of SOP production as of 2018, from the same source as Fig. Earth Moving Worldwide (EMW) was selected to provide mining services for the Colluli potash project in December 2019. Sign up HERE today to benefit from Laurentian Research's in-depth research and the TNRH platform right away! Our 3 Top Picks. It also has access to solar, wind and geothermal energy systems the East African rift. Image courtesy of Danakali. I have taken a starter position and plan to build a position of meaningful size in the next couple of years. Two articles indicate the rapid progress towards the development of a vast potash mine in the Danakil desert. Eritrea has one of the world's most brutal dictatorships, but could a huge potash mine be an economic game changer? Notify me of follow-up comments by email. In some cases, depending on the ambient conditions, this process can take over two years. function GTranslateGetCurrentLang() {var keyValue = document['cookie'].match('(^|;) ?googtrans=([^;]*)(;|$)');return keyValue ? Have the local Afar people been displaced and supplies to their communities cut to allow access to the site? It has a geographic area of 117,600km2, making it slightly larger than Bulgaria. Danakali has a 50% interest in a JV with the Eritrean National Mining Corporation (or ENAMCO), which operates the Colluli project. body {top:0 !important;} My References:Danakali Ltd:https://www.danakali.com.au/ Interested in supporting this channel: Paypal: PayPal . Colluli is the premier greenfield development project globally. Abu Dhabi has established a growing reputation as a source of innovation due to forward-thinking projects across sectors including energy, infrastructure, sport, culture and tourism. Colluli will be a simple open-cut mining operation utilising truck and shovel methods complemented by continuous surface miners. Danakali has reported a 1.1 billion ore reserve with a mine life of almost 200 years. The asset has the potential to produce other fertilizer Eritrea is an ancient civilisation dating back thousands of years and was inhabited by early humans. One-third of the country's GDP is made up of remittances sent home by Eritreans living in Europe and other developed countries. Demand for fertiliser is driven by population and economic growth which directly translates to food demand. 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. 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 company expects to start full commercial production in mid-December 2022. Colluli is positioned very close to vital potash markets. 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). The Colluli project is a 5050 joint venture between South Boulder Mines and the government-owned Eritrean National Mining Corporation. The stock chart of Danakali, modified from this source. Please. DRA Global was selected as the engineering, procurement, construction and management (EPCM) contractor for the project in September 2018. Producer of ColluliMining Share company (CMSC,) a 50:50 Joint Venture between Danakali Limited (DNK) and Eritrean National Mining Corporation (ENAMCO) Codes: ASX: DNK, SO3-FRA, SO3-BER. 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. 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. 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? Das wrde mich fr Eritrea sehr freuen und hoffe das es den Menschen dort zugute kommt.Ich liebe dieses Land zumal meine Tochter einen eritreischen Vater hat.. The company expects to start full commercial production in mid-December 2022. 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. ( source):Danakalihttps://www.danakali.com.au/You can play an important role in investing in a truly once in a lifetime business opportunity. 1). The project also involves the construction of a heavy fuel oil-based power plant on-site to meet the electricity requirement. 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. it is promising future.for our country and people .Thank God. The SOP quality spectrum, from the same source as Fig. Additionally, it will provide comprehensive camp services incorporating catering, cleaning, laundry, pest and vector control, grounds keeping and waste management. But when [Afwerki] discovers that his authority is being questioned after independence, he begins reacting in the same way. 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. 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. 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 country only has one preferential trade agreement in force (with Italy) and is not a member of the World Trade Organisation. 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. 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. Information about Eritrea and the Horn of Africa. Our services are intended for corporate subscribers and you warrant that the email address submitted is your corporate email address. Australias Danakali (ASX, LON:DNK) said on Thursday it was in the final stages of completing the second phase of developmentof its world-class Colluli potash project in Eritrea, Africa. 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, roy.morris@progressivemediainternational.com, +44 (0) 20 7406 6613. Mobile data does not exist. Please disable your ad-blocker and refresh. Colluli contains three potassium-bearing salts in solid form, namely. Agnico Eagle's EPS beat expectations; guidance maintained. 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. The Danakil Depression is located in the Southern region of Eritrea and extends over 300km into Eastern Ethiopia. Front End Engineering Design (FEED) strongly confirms Colluli as one of the worlds most economically attractive, and fundable SOP greenfield development project. Potash demand is largely driven by the need to increase crop production and by improved potash application rates, particularly in developing countries such as Asia, Africa, and Latin America, where potash has been historically under-applied relative to scientifically-recommended levels (Fig. (MOP) and gypsum, along with rock salt. 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. Eritrean troops are fighting on the Ethiopian government's side (Eritrea borders Tigray to the north). What are my chances of getting my money back? "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. Potash is the common term for fertiliser forms of the element potassium (K). 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. The Colluli potash deposit is considered to be one of the worlds shallowest evaporite mineralisation with potash resources found just 16m below the surface. The document estimated that Colluli would contribute 3% of 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. 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. US Level 1 ADR's OTC-DNKLY, CUSIP.23585T101 The world's largest JORC compliant solid salt, Sulphate of . Morgan Leighton. MiningOther CommoditiesIndustrial Minerals, Danakali (50%) and Eritrean National Mining Corporation (ENAMCO, 50%). The accommodation camp, meanwhile, has been designed to accommodate 600 personnel during the production phase with the flexibility to accommodate 1,115 during the construction phase. "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. BHP officials met with Argentinian authorities this week, expressing interest in increasing investments in the San Juan province. 86% of retail CFD accounts lose money. Your email address will not be published. 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. 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 deposit contains mainly three types of potassium bearing salts including sylvinite, carnallitite, and kainitite. The front-end engineering and design (FEED) study for the project was completed in January 2018. Danakali is just one of many deep-value natural resources ideas covered by Laurentian Research. 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. Fig. Danakali Limited is a resource company focused on the Colluli SOP (Sulphate of Potash) Project in Eritrea, East Africa. Climate Change and its Impact on Insurance Market - Thematic Ukraine PESTLE Insights - A Macroeconomic Outlook Report, Germany PESTLE Insights - A Macroeconomic Outlook Report. These alternative producers require substantial lead times to generate their harvest salts for processing. The project, 50/50 owned by Australian mining company Danakali and the Eritrean Government, is rapidly progressing towards construction. The mine will put Eritrea among the top ten potash producers in the world and impact the global supply chain of high-quality fertiliser. 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. We need a bit of money.' 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 United Nations report published in 2019suggested that Colluli could significantly boost the economy of Eritrea. 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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). The plant administration and services facilities will incorporate administration offices, medical clinic, warehouses, and workshops (see graphic above, credit: RA International). In the initial phase of operation, Wage said, Colluli would The three key objectives set for the second phase of development included updating the capital estimate, project schedule and identifying key test work required to move into Phase 3. The Perth-basedminer noted that despite covid-19 restrictions, engineering, procurement and construction management (EPCM) activities have continued as scheduled. 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. the countrys GDP by 2021 and 50% of the nations exports by 2030, while Over the next three decades, almost 95% of the population growth will occur in Africa, India, and South-East Asia. This long-lasting tension has led to Eritrea's militarisation. Looking for a helping hand in the market? 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. It also provides off-takers with additional confidence on Project certainty and fundability, supporting the finalisation of binding bankable offtake agreements. Fig. The front-end engineering and design (FEED) study for the project was completed in January 2018. function googleTranslateElementInit2() {new google.translate.TranslateElement({pageLanguage: 'en',autoDisplay: false}, 'google_translate_element2');} Danakali (DNK) - Technical Analysis. Potash products including SOP, MOP, and SOP-M all have the potential to be produced at Colluli. %PDF-1.7 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. 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.
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