South Boulder Seeks Finance for Colluli

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South Boulder seeking finances to develop world's shallowest evaporite potash deposit in Eritrea
South Boulder seeking finances to develop world’s shallowest evaporite potash deposit in Eritrea

By Africa Intelligence,

Currently setting up the company that will operate the Colluli potash project in Eritrea, South Boulder Mines is looking for ways to actually finance the scheme.

In all, South Boulder needs $700 million, including $454 million to invest in building the mine, plant and export infrastructure, including a port.

The open-cast operation involving 1 million tons per year is programmed to last 17 years and achieve an internal rate of return of 40.6%, or a total of $6.03 billion

The Colluli Mining Share Company which operates the project held its first board meeting last week. It is controlled by South Boulder and by Eritrean National Mining Corp on a 50-50 basis.

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EDITOR’S NOTE: 

The Colluli potash deposit in Eritrea is not only the world’s shallowest but also the only open pit mining in the world. In other words, there are currently no other open pit potash mines in operation and 91% of world production comes from deep underground mines.

The pre-production capital expense of USD 740 million for 1Mt p.a. MOP production presents a highly attractive investment case, and compares very favourably with other proposed or planned potash developments in the industry. For instance, the average pre-production capital expense for Greenfield MOP projects is greater than USD 1 billion per 1 million tonnes of production capacity.

Mineral Resource Estimate for the flagship Colluli Potash Project now stands at 1.08 billion tonnes @ 18% KCl for 194Mt of contained potash.

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