http://www.proactiveinvestors.com.au/companies/news/171640/danakali-s-shares-continue-to-push-fresh-12-month-highs-171640.html
Danakali's shares continue to push fresh 12 month highs
16 Jan 2017
Danakali's share price is up 130% over the past 12 months.
Danakali (ASX:DNK) shares are up 28% year to date and the company has just appointed Global Potash Solutions to join the front end engineering design (FEED) and optimisation team for the Colluli Potash Project located in Eritrea.
Global Potash Solutions will join globally recognised, multi-national engineering and construction firm, Fluor, who is leading the FEED process.
The appointment of Fluor has seemingly been a catalyst for demand and interest in Colluli, which bodes well for Danakali.
Paul Donaldson, managing director, commented: “We are delighted to continue our working relationship with Global Potash Solutions, and look forward to their continued contribution to the technical and operational elements of the project.
“Their extensive technical knowledge and operational experience has been of immense value to the project to date, and we look forward building on this as we advance to construction.”
Global Potash Solutions (GPS)
GPS has extensive technical and operational experience in the global potash industry, supporting projects in the U.S, Canada, South America, Middle East, North Africa and Australia.
It has provided expertise and technical support to Arab Potash Corporation, Potash Corp., BHP Billiton (ASX:BHP) and Karnalyte Resources, as well as completing third party due diligence on potash projects for a number of engineering firms.
GPS oversaw the metallurgical test program, process flowsheet development and initial optimisation work for the Colluli potash project throughout the pre-feasibility and definitive feasibility study phases of the project.
The initial process optimisation work resulted in a reduction in process water requirements of over 70% between the study phases.
Background
The definitive feasibility study on Colluli was completed in November 2015 and the project is currently awaiting mining license approvals.
Danakali has a 50% equity interest in Colluli through a joint venture with the Eritrean National Mining Company.
The study forecast the project to have industry leading capital intensity, bottom quartile operating costs and an ore reserve of 1.1 billion tonnes.
Recent milestones at Colluli include the bidding process for the power generation, the appointment of Fluor and approval of the social and environmental impact assessment (SEIA).
Fluor is a highly reputable, globally recognised engineering and construction firm with extensive experience in potash and Africa.
Approval of the SEIA for the project was given by the Ministry of Land, Water and Environment in December 2016 and the award of the Mining Agreement and Mining License for the project is well progressed.
Analysis
The appointment of GPS is further evidence of development activity at Colluli, which signifies the project’s value and growing momentum.
Colluli is one of the most advanced greenfield sulphate of potash (SOP) developments in the world, and demonstrates outstanding economics.
This includes industry leading capital intensity, bottom quartile operating costs, close proximity to coast and key markets and unrivalled product diversification potential.
The share price is up 130% over the past 12 months, currently priced at $0.615.
Received on Mon Jan 16 2017 - 11:16:04 EST