AMN - ETHIOPIA: Danakil to be world-class potash project

Circum Minerals has announced the results of the optimized Definitive Feasibility Study for its potash project in the Danakil Basin in Ethiopia. This improves a number of the project parameters set out in the original Definitive Feasibility Study completed in August 2015.

The optimized Definitive Feasibility Study confirms that the Danakil project is expected to be a world-class project in terms of size and could potentially become the world’s lowest cost potash producer and a major supplier to the Asia Pacific markets.

Project highlights

-          Measured, Indicated and Inferred Resources of 4.9 billion tonnes at 18.1% KCl

-          Seismic data suggests a potential total resource of 12 to 14 billion tonnes

-          Proven and Probable Reserves of 107.8 million tonnes of KCl equivalent

-          Expected annual production of 2 million tonnes of MOP and 750,000 tonnes of SOP for Phase I

-          Reserves support 26 year mine life for Phase I, including a three year ramp-up period

-          Development capital for Phase I of $2.3 billion (including contingency) with peak funding of $1.8 billion due to early revenue from initial production

-          Low capital intensity per tonne of annual production at $838/tonnes

-          Lowest quartile mine gate cash costs of $38/tonnes of MOP and $112/tonnes of SOP

-          Total operating costs (FOB Djibouti) of $81/t of MOP and $156/tonnes of SOP

-          Substantial transportation advantages to India, Southeast Asia and China

-          After-tax NPV of $2.1 billion, at a 10% real discount rate

-          After-tax nominal IRR of 25.8%.

Circum has identified a number of strategic and financial parties interested in being involved in various aspects of the worldclass Danakil project's development, given its importance to the potash industry and the Asia Pacific markets.

www.circumminerals.com

News courtesy of International Mining