Allana Potash has announced positive results from an independent feasibility study of its Danakhil potash solution mining project in Ethiopia. The study considers commercial operations that will produce 1 million mt/y of a standard grade muriate of potash (MOP) product from sylvinite reserves over an initial estimated operating life of 25 years.

Capital expenditures to develop the Danakhil project, including production, port, logistics and contingency, are estimated at $642 million. The estimate includes all infrastructure required to operate a potash solution mine and bring the product to market, including cavern and wellfield installation, three-stage processing plant, product storage facilities, load out, trucking fleet and port storage facilities with all necessary infrastructure.

Solar evaporation of Danakhil’s saturated brine solution is possible due to year-round hot temperatures averaging 34°C daylong, with very little rainfall. Salts harvested from the ponds will be processed by standard flotation to create an MOP product of a grade sufficient for direct application as fertilizer or as feedstock for processed or blended fertilizers.

Allana will have its own storage facility and conveyor system at the new port of Tadjourah in Djibouti. The main portion of the port, primarily the quay, ship loader, and associated infrastructure, is under construction and will be completed by the Djibouti Port Authority.

Danakhil operating costs, including transportation to port and port handling, are estimated at $98.75/mt.

Initial production could begin in 2015 and full production of 1 million mt/y could be achieved by the end of 2017.

The Danakhil feasibility study was prepared by Ercosplan Ingenieurgesellschaft Geotechnik und Bergbau, a specialist potash engineering company headquartered in Erfurt, Germany.