TORONTO (miningweekly.com) – Allana Potash, hoping to build a mine in Ethiopia, said this week it will decide whether to go ahead with the Dallol project by the middle of next year.
“We should be finished with the NI 43-101 update in the next couple of weeks and, parallel to that, we’ll start moving into our bankable feasibility study which will last nine to 12 months,” said strategic projects senior VP Jack Scott.
After reaching a production decision, Allana could see its first output in two years, he added.
The International Finance Corp last month bought a $10-million stake in the company.
Scott told a conference in Toronto that the shallowness of the deposit made it potentially amenable to openpit mining, as well as solution mining.
And the fact that the Dallol project lies in one of the hottest places on the planet – with average temperatures of around 40 degrees celcius – meant that Allana could save on power costs by evaporating the potash solution it hopes to mine.
Scott also pointed out that Ethiopia is close to India and China, two main markets for potash, which is used as a fertiliser.
Last month, the Indian government announced a multimillion-dollar deal with its Ethiopian counterpart that would see it develop railway infrastructure in the East African country.
Asked to comment on Allana’s relationship with the Ethiopian government, Scott said it was positive: “The Ethiopian government has looked at us as someone who’s helping to promote the country.”
The company stock was trading 2% lower on Friday, at C$1.79 apiece, valuing Allana at C$263-million.