C
<
http://www.shabait.com/articles/q-a-a/11275-colluli-potash-sequel-success-i
n-eritreas-mining-sector> olluli Potash: Sequel Success in Eritrea's Mining
Sector
18.1.2012
12 October 2012 11:15 | Written by Kesete Ghebrehiwet |
<
http://www.shabait.com/articles/q-a-a/11275-colluli-potash-sequel-success-i
n-eritreas-mining-sector?format=pdf> PDF
<
http://www.shabait.com/articles/q-a-a/11275-colluli-potash-sequel-success-i
n-eritreas-mining-sector?tmpl=component&print=1&layout=default&page=> Print
<
http://www.shabait.com/component/mailto/?tmpl=component&link=aHR0cDovL3d3dy
5zaGFiYWl0LmNvbS9hcnRpY2xlcy9xLWEtYS8xMTI3NS1jb2xsdWxpLXBvdGFzaC1zZXF1ZWwtc3
VjY2Vzcy1pbi1lcml0cmVhcy1taW5pbmctc2VjdG9y> E-mail
http://www.shabait.com/images/stories/shabimages/qa12.gifEritrea's geology
has proven to be quite attractive for investors in the mining sector. What
has been achieved in the mining of gold and base metals would soon be
followed by potash. This will apparently push the development of Eritrea's
mining sector forward. Shabait has, during the Asmara Mining Conference held
last week in Asmara Palace, conducted an interview with Mr. Zeray Leake,
Chief Geologist and Country Manager of South Boulder Mines LTD, as regards
the ongoing developments in Colluli Potash deposit, and the excerpt follows:
Q: What are the developments at Colluli potash deposit since that of last
year's Geo Congress?
After the last year's geo-congress, we recalculated the resource twice.
Based on the resources of October 2011, we completed the engineering scoping
study one which targets production of sylvinites with annual production
capacity of one million tones per year. When we see the engineering scoping
study, the resource in Colluli is quite amazing. After all, the initial
investment is also quite low; it is about 740 million US dollars and this is
very cheap compared with other industries. For instance, to produce one
million tone of potash per year, you need to invest may be one billion US
dollars. So, when compared with other deposits, the investment in Colluli is
it quit cheap. On the top of this, we properly defined deposit of area "B"
and we also extended the resources there. Accordingly, we recalculated the
resources just in last April and now Colluli stands at 1.08 billion tones
with 18% of kcl, which means we have a total content of 194 million tones of
potash.
Q: What could be expected in 2013 and afterwards?
Based on the first engineering scoping study, it is very encouraging to
proceed with the project. So, we have initiated the definite feasibility
study (DFS) and we are expecting to finish this study in July 2013. As the
scoping engineering study was very comprehensive, we didn't do any pre
feasibility study; we were quite confident to jump to the DFS which involves
a number of engineering works, designing and processing activities. We are
working on the infrastructure, all the processing, mining, resources and
social and environmental impact assessment. Besides, we are working with the
jetty, or the port which we call it product export terminal (PET) that will
be located on the Anphile bay. We are just doing a number of things which
are going simultaneously and that way we are intending to speed up
production period.
Q: Is the construction underway?
We will just finish the DFS. In the mean time, we are negotiating with the
Eritrean National Mining Corporation (ENMCO). Sealing the deal with the
ENMCO will speed up the mining license permitting. So, we will put an
application for mining license and 2014 and 2015 will be construction period
and 2016 will be the first production.
Q: Will the South Boulder start mining with area "A" or are you planning to
do it simultaneously with area "B"?
The strategy is to start with area "A". We will start with the sylvinite;
when we see the stratigraphy of the deposit, sylvinite is the top most
layer. Therefore, we will start production from sylvinite with initial
capacity of
one
http://www.shabait.com/images/stories/shabimages/cluil-potsh2.jpg million
tones per year. After five years, we may just look to expand it into 2
million or 3 million tones per year; in that case we may start to mine the
carnallite. However, the first strategy is to completely finish with Area
"A" and to expand it to area "B".
Q: Which market areas are you looking for?
Our target is Asia. Especially, due to the population, the overall
developments and change of diet as well as closeness to Eritrea's coastal
area countries like India, Malaysia, Indonesia and China would be our
market targets. There is, of course, a lot of interest from Chinese and
Indian companies, there are also investors form the Middles East such as
from Qatar and Oman. So, our target will definitely be Asia. The
aforementioned advantage is a good reason to target Asia.
Q: Does the South Boulder encounter any sort of technical challenge; if so
how have you been overcoming it?
Well, we don't have a major problem to date. All the challenges we have been
having are the normal exploration and geological matters. Otherwise, we have
been having a very good support form the Eritrean Government; the local
communities, all government offices and ministries in Asmara and Massawa
have been very supportive and that's why we are at this stage.
Q: Let's talk about the social and environmental impact of the project?
When we see the social and environmental impact of the project, the project
site is in the Danakil Depression, 100 meters below sea level, where there
is no potable water, every thing is quite brackish -- no wild life and no
vegetation and the closest community is more than 35 km form the area and
this makes the project quite interesting. Besides, since we will not
generate any acid like the gold and base metal mines, there will be no
significant impact on the environment. We are designing every thing in very
environmental sound way. We have involved engineers, who have good
experience in designing such kind of projects and environmental consulting
firms, who have good experience with Eritrea and potash. Any mining activity
can have some adverse impact on the environment, but what matters is the
design and involvement of communities. We are seriously working in
addressing this issue through different base lines on vegetation, wild life,
and livelihood including land forms. What is more is that, we have
considered archeological items and heritages, marine life and any thing
associated with the ecosystem. We will be working hand in hand with the
local government and the communities who are a bit far from our mining site.
Since it is going to be a big project, we are intending to involve all the
coastal communities, for it will not be simple to mobilize work force from
Asmara or some where else. So, we are planning to organize some sort of
trainings and thus communities around the area could cope with the
technology and can be part of the project.
Q:
http://www.shabait.com/images/stories/shabimages/colill-potsh.jpgWhat
could we expect from the annual production of potash?
When we say an annual production of one million tones of potash, that is,
taking the current potash price, it would be half billion US dollars and if
the production is expanded into 2 million tones of potash the annual revenue
would definitely be one billion US dollar. With such a development, I can
see its impact in improving the overall livelihood of Eritreans.
Received on Fri Oct 19 2012 - 02:56:04 EDT
