This year is set to be an important and transformational year for ASX-listed South Boulder Mines, the developer of the Colluli potash project – the world’s first, modern, open pit potash mine, located in the Danakil Depression region of Eritrea, in east Africa.
South Boulder expects to complete all pre-feasibility study (PFS) work streams in anticipation of the publication of the PFS economics in Q1.
The emerging potash developer also aims to complete a high quality definitive feasibility study (DFS) in Q3, Chairperson Seamus Cornelius announced in a statement on Monday.
South Boulder is focused on developing the Colluli potash project in cooperation with its partners, the Eritrean National Mining Company (ENAMCO), through a 50/50 joint venture known as Colluli Mining Share Company (CMSC).
The JORC/NI43-101-compliant mineral resource estimate for the flagship Colluli potash project now stands at 1.08-billion t @ 18% KCl for 194 Mt of contained potash.
The PFS is being managed by South Boulder MD Paul Donaldson and his team along with consultants Lycopodium, Global Potash Solutions, AMC Consultants, PRDW, Knight Piesold, and MBS Environmental, who are busy completing and compiling the PFS report.
Extensive work has been done over the past 2 years at the Colluli potash deposit since starting the PFS/DFS work program in April 2014. “This work has greatly increased our understanding of the deposit and how it should be developed to generate maximum benefit for stakeholders,” says Cornelius.
Colluli has a unique composition of potassium bearing salts in solid form, suitable for the production of both potassium sulphate (SOP) and potash of magnesia (SOPM). These are premium potassium fertilisers used in the agriculture industry with limited primary production globally, due to resource scarcity.
Moreover, the considerable size, shallow depth (starting at 16 m) and consistency of the deposit make Colluli highly amenable to economically viable low capex open cut mining.
The resource is also in close proximity to the Red Sea coast, allowing easy access to the company’s already identified end markets.
South Boulder is confident that its plan for the development of Colluli, which is underpinned by extensive and rigorous work, both scientific and practical in nature at PFS and DFS level, will be implemented.
“As we have stated consistently over the past year, the development plan will be based on the principles of modularity, risk mitigation, simplicity, compatibility with local circumstances and full resource utilisation. I am confident that we have an exceptionally talented and well-balanced team in place to support the work we are undertaking.” Says Cornelius.
He goes on to say that as module 1 at Colluli will produce the premium potash products SOP and potentially SOPM, it should not really be compared to any of the more common emerging muriate of potash projects. Naturally in a competitive market for capital, comparisons will be made.
“We are confident, however, that our plan for Colluli will compare very favourably from any perspective be it capital expenditure, operating costs, mine life, product range, infrastructure requirements or profitability.”
After the key PFS information is published, South Boulder intends to make progress on a number of key commercial and corporate fronts that will support the development of Colluli and clearly demonstrate a significant level of major investor, infrastructure developer and end user interest in Colluli.
South Boulder is to hold an AGM, before May 31, 2015, in which it will remind shareholders that the financial year-end for South Boulder was changed from 30 June to 31 December to better aligns the STB year-end with that of CMSC and STB Eritrea and to ask shareholders to approve a name change for the company to better reflect its activities as an emerging producer of premium potash and agricultural chemicals from the Colluli resource.