CEO of potash junior Danakali Paul Donaldson will transition from his role as CEO and MD to non-executive director, before the end of 2017.Danny Goeman, a highly experienced mining industry professional will transition from Head of Marketing to the role of CEO where he will focus on completion of the binding off-take agreements and overseeing the continuation of the debt and equity process for the development of the company's Colluli potash project - as well as the LSE listing.
Donaldson, an experienced chemical engineer and mining industry professional was responsible for redefining the product and development path and process for the Colluli project and overseeing the scoping, prefeasibility, definitive feasibility and FEED phases.
Goeman has more than 25 years of extensive experience in management, sales and marketing strategy development and high level commercial negotiations, including more than 20 years with the Rio Tinto group of companies.
He holds a Master’s Degree in Business Administration and joined the Danakali team in August 2016. The timing of the transition coincides with the final stage of the pre-construction studies.
The industry and project knowledge, skills and relationships developed by Donaldson throughout the study phases will be retained within both Danakali and the Colluli Mining Share Company as the project progresses.
Donaldson will assume chairmanship of a newly established technical review sub-committee within Danakali and join the nomination and remuneration committee.
With the FEED drawing to conclusion, Colluli remains the most advanced stage Greenfield SOP development in the world. The project has been costed to a +/-10% level of accuracy and is supported by firm operational contract bids.
The project is fully permitted and ready to immediately advance into engineering and construction upon securing funding. Social and environmental impact assessments and associated management plans have been completed to ensure consistency with the Equator Principles.
Stakeholder engagements have been completed throughout the study phases, and the project has strong support from local communities.
The SOP market has been exceptionally price resilient throughout the commodity cycle, with a significant increase in price premium being observed over the more common potash type, potassium chloride (MOP) since 2012. Economically exploitable primary resources are geologically scarce.
Off-take discussions well progressed
The company continues to advance its off-take strategy and is working with a select group of potential off-take parties to secure bankable off-take agreements. Danakali has been well supported by Norton Rose Fulbright in the development of the contract framework.
Completion of binding agreements is targeted for Q1, 2018.
Equity strategy advancing
The Danakali Board of Directors has approved applying for a secondary listing on the London Stock Exchange (LSE) which is expected to be complete by Q1, 2018.
Debt process progressing
The completion of FEED is a key milestone to advance debt funding discussions with the completion of equipment and supplier lists. The company is progressing discussions with commercial lenders, export credit agencies and development finance institutions with regard to the funding solution and is progressing ‘know your client’ (KYC) processes with a number of commercial lenders as the revised FEED economics draws to conclusion.
Strong cash position
The company currently has a strong cash position of approximately A$16 million with approximately A$3.5 million of in-the-money options with 30 March 2018 expiry.