Date: Monday, 23 January 2017
http://www.proactiveinvestors.com.au/companies/news/171974/danakali-makes-more-appointments-at-colluli-potash-project-171974.html Danakali makes more appointments at Colluli potash project 23 Jan 2017 Shares in Danakali are up 65% over the past three months. Danakali (ASX:DNK) has made its final appointments to the front end engineering design (FEED) team at the Colluli Potash Project in Eritrea. The final two appointments include Knight Piésold and Elemental Engineering and the optimisation process has now commenced. They will join globally recognised, multi-national engineering and construction firm, Fluor, who is leading the FEED process, as well as Global Potash Solutions. Paul Donaldson, managing director, commented: “We are excited to be advancing the Colluli project and bringing the project construction closer to reality. “Assembling and aligning a quality team, highly familiar with the project to support the final project definition work has been a priority for the project team, and they have successfully delivered.” The FEED process The FEED process is being led by Fluor, who was appointed in early January. The process has commenced with the FEED team assembling for the first phase of value engineering and optimisation. This phase will identify key capital reduction and optimisation areas, prior to the development of the final equipment lists and procurement packages. The FEED phase will deliver the overall contracting strategy and detailed implementation schedule. Mining contract update As a precursor for the competitive tendering of the mining contract, an expression of interest process is underway. Work is also expected to commence in the near future on breaking the definitive feasibility study mining schedule into further detail to support the mining contract tendering process. 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. 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. Share price on the rise Danakali is trading up 65% over the past three months, currently priced at $0.63. Colluli is one of the most advanced greenfield sulphate of potash (SOP) developments in the world. It demonstrates outstanding economics including bottom quartile operating costs, close proximity to coast and key markets and unrivalled product diversification potential. The completed definitive feasibility study estimated a post-tax net present value (NPV) of US$860 million and an internal rate of return (IRR) of 29%. -- Stock Name: DNK Company Name: DANAKALI LIMITED Date: January 23, 2017 Announcement in PDF format http://www.danakali.com.au/images/stories/axs-announcements/2017/Final_appointments_to_Colluli_FEED_Process.pdf
