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. A United Nations report published in 2019suggested that Colluli could significantly boost the economy of Eritrea. 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 economy expanded by 2.9% in 2021 and is forecast to surge by 4.8% this year, according to the International Monetary Fund. The production of other agricultural and salt products, including Rock Salt, Kieserite, Gypsum and Magnesium Chloride, is also possible from the Colluli resource. We are confident in RA Internationals capabilities to deliver a high-quality product and service.. It is estimated that 49% of the population is Christian and a further 49% is Sunni Muslim. .goog-te-banner-frame {display:none !important;} ( source):Danakalihttps://www.danakali.com.au/You can play an important role in investing in a truly once in a lifetime business opportunity. Fertiliser is a key component to ensure world food security in the future. development of the project, and the expected significant boost to royalties, 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. 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 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. 4). 5. In the long run, potash consumption is expected to continue to grow as a result of population expansion. Simplified process flow for the production of SOP from the Colluli resource, from this source. Under the terms of the agreement, EuroChem will take, pay, market, and distribute up to 100% of the Colluli sites SOP fertiliser production over a 10-year term, from the Projects date of commissioning. Send Me Updates. 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. 86% of retail CFD accounts lose money. %PDF-1.7 Mobile data does not exist. 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. Adjusted net income of $0.52 beat the consensus estimate of $0.43. 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). Upon accepting the notice, the ministry, Danakali said, also showed support for the financing of the Colluli project by: The independent study, commissioned and funded by the UN Development Program (UNDP), assesses a wide range of econometric data and includes . It also provides off-takers with additional confidence on Project certainty and fundability, supporting the finalisation of binding bankable offtake agreements. World potash demand has grown at an average rate of 2.5-3.0% per year since 2000 (Fig. Niels Wage, CEO of Danakali, said: I am pleased to announce the appointment of RA International as our preferred accommodation and support services contractor. Fig. Potash is an important fertiliser. body {top:0 !important;} SOP - a premium grade fertilizer - usually grabs a higher price at US$500-650/t (see here). Danakali (DNK) - Technical Analysis. Danakali (ASX: DNK) is the 50% owner of the Colluli Potash Project located in Eritrea. 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. 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. The total measured, indicated and inferred SOP mineral resources at the deposit are estimated to be 1.29 billion tonnes grading 11% K2O. .goog-te-menu-value:hover {text-decoration:none !important;} 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. Development Goals (SDGs). 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. A big economic change will come to eritrea, proud to be an nseritrea. Sign up HERE today to benefit from Laurentian Research's in-depth research and the TNRH platform right away! There is also potential for kieserite In the initial phase of operations, the mine would produce more than 472,000 tonnes a year of sulphate of potash (SOP), a premium grade fertilizer. It is actually resistant to the wests oppression in the most pure sense of the term. Therefore, the Eritrean government has a strong incentive to see the project be built, in production, and run successfully. 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. Please. taxation and exports, and from jobs and skills and economic development of the Italy created the colony of Eritrea in the 19th century around Asmara and gave it its current name. 3). 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. Potassium bearing minerals are typically found in areas where ancient inland seas have evaporated leaving behind their minerals. Colluli is without peer on capital intensity and production capacity with the ability to expand rapidly. 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 Colluli potash project is considered one of the worlds most significant and lowest-cost sources of sulphate of potash (SOP), a premium grade fertilizer. Economic resources for Sulphate of Potash (SOP) production are scarce, and Colluli is favourably positioned to supply the worlds fastest-growing SOP markets. stream as being forecasted back in 2015 has been removed from the supply side (Fig. The Danakil Depression is an emerging potash province in Eritrea and Ethiopia. The FEED results and the recent completion of test work and additional verification provide a higher level of financial certainty to project financiers, further de-risking the investment proposition. 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. Potassium is one of three key fertiliser macro-nutrients essential for healthy soil and plant growth. The UN says forced labour and detention without trial are common. Information about Eritrea and the Horn of Africa. I think you should research about th e author. and then onto production in 2022, Danakali said. Eritrea has huge tourism potential, but it is hard for foreign visitors to obtain a visa. 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 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. Pilot tests from the Colluli salts have generated product samples for marketing purposes which are now being distributed to prospective customers. It has had a border war with Ethiopia and a clash along the border with Djibouti. A United Nations reportpublished last yearsuggested that Colluli could significantly boost Eritreas economy. 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 (. Artists impression of the plant at the Colluli project. (. Potash, an important fertiliser, is found in abundance in certain parts of Ethiopia and Eritrea. The project will be developed in multi-modules, with Module I serving as a platform for future growth. 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. Below, let's look at Danakali Ltd. (DNK.ASX) (OTCPK:SBMSF) (OTCPK:DNKLY), which operates in Eritrea. Eritrean troops are fighting on the Ethiopian government's side (Eritrea borders Tigray to the north). About 55% of the Eritrean population is Tigrinya while 30% is Tigre, but there are a number of other smaller ethnicities including Saho and Kunama. 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. Profit was boosted by higher metal grades and prices. We need a bit of money.' (3) various tools to aid your investment decision making, (4) trade alerts and multiple thematic weekly newsletters and. Fig. The company expects to start full commercial production in mid-December 2022. The project has the world's. Colluli Potash Project, Eritrea. 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. My References:Danakali Ltd:https://www.danakali.com.au/ Interested in supporting this channel: Paypal: PayPal . Surface mining allows controlled extraction, predictable production rates and efficient stockpiling of additional economic salts know to us. It also has access to solar, wind and geothermal energy systems the East African rift. It has industry-leading capital intensity, forecast first quartile operating costs, and highly attractive economic returns. 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. It has been a Unesco World Heritage Site since 2017. To open fire on your own disabled [people] is pretty appalling.". The development of the Colluli potash projects coincides Our 3 Top Picks. On July 9, 2018, a joint declaration of peace and friendship was signed between Eritrea and Ethiopia. US Level 1 ADR's OTC-DNKLY, CUSIP.23585T101 The world's largest JORC compliant solid salt, Sulphate of . Eritrea's north-eastern and eastern parts have an extensive coastline along the Red Sea, strategically located along the Maritime Silk Road. Wall Street Bulls Look Optimistic About Nutrien (NTR): Should You Buy? The Company is developing Colluli in partnership with the Eritrean National Mining Corporation (ENAMCO). 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. This long-lasting tension has led to Eritrea's militarisation. It nosedived again in 2017, this time by -10%, before jumping by 13% in 2018. EuroChem is an outstanding partner with global reach and extensive fertiliser capabilities. Eritrea is an ancient civilisation dating back thousands of years and was inhabited by early humans. Morgan Leighton. The project has been largely derisked with regard to geopolitics, infrastructure, off-take, and financing. mine-life. These authors includeSilver Coast Research, , among others. Why isn't Europe investing more in recycling plastic. February 25, 2022. Best. In 2023, Botswana expects diamond output to decline by 1%. The stock seems to be agitating for a breakout in recent weeks (Fig. A pre-feasibility study for the project was completed in February 2015 followed by the completion of a definitive feasibility study (DFS) in November 2015, while the mining license was granted in February 2017. A United Nations report says that Eritrea's Danakali Colluli potash project has the potential to boost the economy of the country that was removed from the UN's sanctions list only two months ago. The miner said it would use the remaining cash about $12 million to identify new projects and potential new alternative growth opportunities.. Journalists say that getting any information out of the country is extremely difficult. 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. 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. 6. In addition to these benefits our grade control drilling provides us to approach the open cut mine plan with a high degree of selectivity and certainty. The shortfall of projected and actual global potash capacity, from this source. 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. This post has been syndicated from a third-party source. The JORC-2012 compliant mineral resource estimate, from this source. 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. Danakali is just one of many deep-value natural resources ideas covered by Laurentian Research. endobj Front End Engineering Design (FEED) strongly confirms Colluli as one of the worlds most economically attractive, and fundable SOP greenfield development project. endobj In 2019, the country received only $67.1m in foreign direct investment (FDI) inflows against $61m in 2018, according to the World Bank. It has a geographic area of 117,600km2, making it slightly larger than Bulgaria. The country also boasts impressive marine tourist sites, a wide range of flora and fauna, and scenic terrain. The removal of Eritrea from the sanction list opened up the country for foreign investments, thus significantly reducing geopolitical risk. Required fields are marked *. 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. To lower infrastructure uncertainties, in August and October 2020, respectively, Danakali appointed RA International Group PLC as the preferred contractor for the supply of accommodation, support services, and other infrastructure buildings, and Aggreko (AGK.LSE) as its preferred power supply contractor for its 12MW HFO power plant at Colluli under a five-year BOOT contract, removing a major infrastructure uncertainty. The stock chart of Danakali, modified from this source. 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 border with Sudan was closed until early 2019 because relations were so bad. 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 best energy and mining stock ideas with multibagger potential. Please disable your ad-blocker and refresh. 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. It also contains other fertilizer products, such as muriate of potash (MOP) and gypsum, along with rock salt. growth and decent work, industry, innovation and infrastructure, reduced <> 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. Colluli has a JORC-2012 compliant Measured, Indicated and Inferred Mineral Resource estimate of 1,289Mt @11% K20. The Colluli Potash Project (Project, Colluli) is 100% owned by Colluli Mining Share Company (CMSC,) a 50:50 Joint Venture between Danakali Limited (DNK) and Eritrean National Mining rporation (ENAMCO) Codes: ASX: DNK, SO3-FRA, SO3-BER. To ensure this doesnt happen in the future, please enable Javascript and cookies in your browser. 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. 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. I'd like to emphasize that the articles contributed by these authors are the product of their respective independent research and analysis. Fig. 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. These alternative producers require substantial lead times to generate their harvest salts for processing. In November 2021, Eritrea also signed a memorandum of understanding with China to join its Belt and Road Initiative.