Ethiopia: Allana SOP Project at Danakhil

Toronto-headquartered Allana Potash Corp. is a junior mining company with a focus on the acquisition and development of potash assets internationally with its flagship in the Danakhil Potash property (also referred to as the Dallol Potash Project), which is a previously explored potash property in northeastern Ethiopia. Now Allana has announced the results from an independent preliminary economic assessment (PEA) of production of SOP (sulphate of potash), a premium potash product widely used on chloride sensitive crops such as tobacco, fruits and vegetables, as well as nuts. In 2014 world production was of some 2.7 million tonnes K2O. China is the largest consumer. SOP production would be a separate mining operation producing about 1 million metric tons per year over an estimated 77- year operating life through solution mining of brine followed by solar evaporation. The Danakhil Project area is the one of hottest places on earth, which allows for the use of solar evaporation after solution mining and should bring significant cost savings. It has been reported that Ethiopia is the cheapest place to extract potash after Jordan, because the deposits are only 100 meters below the surface, compared with about 1,000 meters in Brazil and Canada where the grade is similar. Total operating costs, including production, transportation, port storage and loading, and sustaining capital expenditures, are estimated at $130/mt of SOP. The payback period from the start of production is estimated at four years.

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