HOT PROSPECT The Bada licence is located in the northern-most part of Danakil depression where temperatures can exceed 50 °C
Resource company Essel Group Middle East (EGME) expects to start Phase 1 of its drilling programme for its Bada potash project, in Eritrea, next month.
EGME CEO Punkaj Gupta says the remainder of its 2016 exploration campaign will primarily be focused on drilling test holes to examine the layers of potash evaporation ponds (evaporates) beneath the overburden. EGME is studying the satellite and radar data of the licence area to determine target areas.
Gupta explains that the 626 km2 Bada licence area – in the northern-most part of the Danakil region, in the Danakil depression – is among the most exciting prospects in EGME’s portfolio.
The company will use conventional drilling technologies and methods to bore between five and ten test holes by early 2017. “We will undertake a rigorous programme of sample testing and analysis across the licence area and hope to have drilled four or five deep test holes by the end of this year.”
Gupta notes: “For this campaign, up to seven drill holes can cover the priority target area.” Once the layers of evaporates have been confirmed, EGME will undertake a detailed ground gravity survey to establish the extent of the potash deposits within the basin.
EGME has deployed a team of nine full-time employees – comprising a project manager, three geologists, two exploration foremen and three coordinating staff – for the exploration phase. The team will be supported by about 40 contract workers.
Gupta says the team will collect surface samples in close proximity to areas that have been targeted for drilling in the past and, in time, extend this process to cover the remaining sections of the licence area.
The company plans to collect 2 400 surface samples, 100 to 150 water and soil samples, and 50 to 100 chip samples, he adds.
EGME has enlisted Australian mining consultant Bureau Veritas to conduct the sample analysis. Gupta comments that, through the early stages of testing, the company will process its samples at a laboratory in Eritrea and coordinate with Bureau Veritas employees in Australia.
Gupta highlights that the Bada potash licence was originally granted to Canadian exploration company NGEx Resources in 2010.
“NGEx drilled six holes at the Bada basin and, according to the lithological data, all the drill holes were completed within the overburden zone. As a result, the layers of evaporates are yet to be tested and that is where we will now focus our attention.”
Gupta notes that, to date, EGME has not encountered any unforeseen challenges but, as with any underdeveloped asset, there have been small setbacks in the early phases. He cites the exploratory work carried out by NGEx, adding: “It was not as thorough as we would have liked, so we have not been able to asses the gravity and core drill tests.”
Moreover, the Bada licence area is in a fairly remote location, which means that it will take time to complete the testing phase. Gupta states: “These are all small issues though and we remain extremely confident about the prospects for the asset. We’re looking forward to starting the drilling process.”
The company expects this current phase of exploration to take nine to ten months to complete, mostly because of the conditions at the Danakil depression, specifically between May and September, when temperatures can exceed 50 °C.
Gupta says it is clear that the area has compelling geological characteristics. EGME estimates that the area comprises reserves of more than one-billion tonnes.
The project also contains one of the shallowest deposits of potash in the world at between 75 m and 125 m beneath the surface; therefore, capital and production costs should be less expensive.
EGME has developed a positive working relationship with local authorities, as the Eritrean government firmly supports its mining industry and its potential for economic growth. “The level of government support is important and we look forward to working closely with the relevant local parties and successfully delivering on the tremendous potential that exists at the Bada mine,” Gupta concludes.