Danakali Limited (ASX:DNK) is focussed on the development of the Colluli Potash Project. The project is located in the Danakil region of Eritrea, East Africa and is 100% owned by the Colluli Mining Share Company (CMSC). CMSC is a 50:50 Joint Venture between Danakali Limited and the Eritrean National Mining Company (ENAMCO).
Since drilling commenced at Colluli in early 2010, over 1 billion tonnes of potassium bearing salts suitable for the production of potash have been identified. The potassium bearing salts of the Danakil have the unique capability of producing a diverse range of potash types including muriate of potash (MOP or potassium chloride), sulphate of potash (SOP or potassium sulphate), and sulphate of potash magnesia (SOP-M or potassium magnesium sulphate).
Sulphate of potash is a highly valued, chloride free, premium potash fertiliser that has limited primary production facilities globally. SOP contains both potassium and sulphur, which are essential crop nutrients.
Following the positive outcomes of a prefeasibility study (PFS) for the production of sulphate of potash (SOP) in February 2015, a definitive feasibility study (DFS) was completed in November 2015, for a two 425,000 tonne per annum SOP module development. The second module is planned for commissioning five years after the first. The DFS results exceeded expectations and the PFS results.
The Colluli deposit is the shallowest known deposit globally, is located only 75km from the Red Sea coast, and is geographically favourable relative to the key potash markets of the future. The resource is positively unique.
Danakali is now focussed on the mining license application process whilst preliminary funding discussions continue with offtakers, strategic partners and financiers in order to fund the development capital ahead of construction