JOHANNESBURG (miningweekly.com) – Circum Minerals expects to
complete the definitive feasibility study (DFS) for its Danakil potash project, in the northern margin of the Danakil depression, in Ethiopia, by mid-year and foresees the production of 2.75-million tonnes a year of saleable potash salts over a minimum of 30 years.
Aim-listed Premier African Minerals CEO George Roach noted on Friday that if the DFS realised Circum’s hopes that the Danakil project was a “potential major, world-class potash project” under development with robust economics, Premier expected a substantial uplift on the value of its interest in Circum.
Premier held two-million shares in Circum, which had received a further $5-million on an exercise of investor warrants which, at the exercise price of $1.25 a Circum share, valued at $116-million on a fully diluted basis.
Premier's interest was currently valued at $2.5-million
“We believe that the completion of the resource estimate by K-Utec Salt Technologies and the proposed DFS should provide an opportunity for Premier to realise its investment at an attractive valuation during the latter part of this year," he added.
Circum had currently completed road construction, drilling and the seismic portion of Danakil’s feasibility study, which was scheduled for completion in 2015. The company also expected to update the project’s resource estimate in the first quarter of this year.
Circum finalised its drilling programme at Danakil on the western area resource at the end of November and the eastern area in December. The seismic survey was also completed in December.
Other elements of the feasibility study to be completed this year included the definition of the Danakil project’s water resources, plant design, operating and capital costs, and the completion of its transportation and port infrastructure plans.