Oslo, 13 February 2015: A feasibility study, carried out on behalf of Yara International confirms significant potential to extract potash in the Danakil depression in northeastern Ethiopia.
The independent study identified an annual production of 600,000 metric tons sulfate of potash (SOP) over 23 years from reserves (Kainite, Carnallite and Sylvinite) at Yara`s Danakil concession. The company, which aims to begin mining activities in 3Q, 2018, is now seeking equity partners to develop the project.
The reserves will be mined using solution mining technology. The brine produced at the mining sites will be evaporated utilizing high solar radiation. The harvested salts will be processed and re-crystalized to SOP. Both standard and compacted SOP will be produced.
The product will be trucked 790km to Tadjoura, Djibouti, where the project includes a product storage and handling terminal at the new port currently under construction by the Djibouti Port Authority.
Capital expenditure of the project is estimated at USD 740 million, while operating expenditure is expected to amount to USD 167/metric ton FOB Djibouti.
The combination of a unique geological structure and an extreme climate in the Danakil depression required adjustments in the production process. Yara developed new technologies to fully utilize the local advantages.
Yara`s Danakil mining project has received the backing of the Ethiopian government, which has committed to providing electric power by building a 130km long power line. The government will also construct a new lowland transportation road to support mining operations. Sustainable water availability has been confirmed through a water exploration campaign, while an environmental and social impact assessment study confirms that the future activities comply with Ethiopian environmental legislation and international guidelines and standards.