Danakali Ltd begins the preliminary works program for the Colluli Potash project with an ongoing reverse osmosis plant

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“The RO plant, which will make fresh water available at the site, is an essential part of the project and the preliminary work program,” said the president.

() () () (FRA: SO3) instructed WEC Projects in South Africa to complete reverse osmosis (RO) plant fabrication and function tests ready to ship to Colluli Potash project of society in Eritrea.

WEC has confirmed that the manufacturing of the RO plant will be completed and it will be ready to ship to Massawa, Eritrea in 3-4 months.

The total contract value for the RO plant is US $ 1.6 million.

“Essential element of the preliminary work program”

The project is 100% owned by the Colluli Mining Share Company (CMSC), a 50/50 joint venture between Danakali and the Eritrean National Mining Corporation (ENAMCO).

Danakali Executive Chairman Seamus Cornelius said: “I am very happy to confirm that the manufacturing of the RO plant is underway.

“Everyone involved in Colluli, including our partners, ENAMCO and our shareholders, want to see progress and the RO plant, which will make fresh water available on site, is an essential part of the project and the program of the first works.

Potential of the Colluli project

Mineralization within the Colluli resource begins at just 16 meters, making it the shallowest known potash deposit in the world.

The resource lends itself to surface mining, which allows for better overall resource recovery, is generally safer than underground mining, and is very beneficial for modular growth.

The company has completed a Front Engineering Design (FEED) for the production of Potassium Sulfate or Potash Sulfate (SOP).

One of the main advantages of the resource is that the salts are present in solid form (unlike the production of SOPs from brines), which reduces infrastructure costs and significantly reduces the time required to reach full capacity. of production.

Financial outlook

A binding take or payment agreement has been confirmed with EuroChem Trading GmbH (EuroChem) for a maximum of 100% (minimum 87%) of the production of Colluli Module I SOP.

Development finance institutions, the African Finance Corporation (AFC) and the African Import-Export Bank (Afreximbank), have obtained formal credit approval to provide CMSC with US $ 200 million in senior debt financing.

The credit documentation was executed in December 2019, allowing the withdrawal of CMSC’s senior debt upon satisfaction of the usual conditions precedent – which represents the majority of the financing required for the development and construction of the Colluli project.



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