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Brazil-based potash project in development phase

POSITIVE RESULTS Verde Potash published a positive update in March on Cerrado Verde’s measured and indicated resource

Photo by Verde Potash

POTASSIUM SILICATE Cerrado comprises a surface deposit of potassium silicate rock, which is amenable to strip mining, enabling fast construction of a scalable operation

Photo by Verde Potash

MOVING FORWARD Verde Potash received about $105-million in government funding to cover about 90% of the capital expenditure for Phase 1 of the project

Photo by Verde Potash

25th July 2014

By: Jonathan Rodin

  

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Brazil-based fertiliser development company Verde Potash is focusing on securing an environmental licence for its Cerrado Verde potash project, which is currently in the development stage in Brazil’s Minas Gerais province.

Verde Potash CEO Cristiano Veloso tells Mining Weekly that the company also aims to secure a market for the multinutrient fertiliser ThermoPotash and explore additional funding alternatives.

The company announced in February that it had been selected by Brazilian funding programme Inova Agro to receive about $105- million in government funding to cover about 90% of the capital expenditure (capex) for Phase 1 of the project, which involves the construction of a 330 000 t/y ThermoPotash plant at Cerrado Verde.

Verde Potash completed a prefeasibility study in April for the production of ThermoPotash, which included a revised mineral resource estimate, says Veloso.

The company also published a positive update in March on Cerrado Verde’s measured and indicated resource, lifting its flagship resource to more than 295-million tonnes of in situ potassium oxide – an increase of 16.5% on the previously announced 253-million tonnes.

Meanwhile, Veloso notes that the ore at Cerrado comprises a surface deposit of potassium silicate rock, which is amenable to strip mining, enabling fast construction of a scalable operation.

The project is located in the world’s third-largest and fastest-growing fertiliser market, connecting to Brazil’s largest fertiliser distribution districts through existing and high-quality infrastructure.

Verde Potash aims to become a critical supplier to this market using relatively simple processes to convert the potassium silicate rock mined at Cerrado Verde into ThemoPotash during Phase 1 of the project, while Phase 2 will produce potassium chloride on a much larger scale.

About ThermoPotash
ThermoPotash is a controlled-release, nonchloride, multinutrient fertiliser ideally suited to Brazilian soils. Veloso explains that this new product is expected to compete with other premium, multinutrient, nonchloride fertilisers – such as potassium sulphate and potassium nitrate – currently on the Brazilian market.

The company’s research, which began in 2009, builds on studies conducted in 1983 by agronomist Dr Mathew Eichler, who tested several formulations using the potassium silicate rock for agricultural use.

His work determined that thermo-potash- lime, a combination of 50% of the potassium silicate rock and 50% limestone, when heated to 1 100 ºC, is effective on crops.

Veloso adds that ThermoPotash enriches soil with potassium without the negative effects of chlorine, while the limestone content mitigates the high acidity of Brazil’s soils.

Veloso further details that the type of mineral found at Cerrado Verde differs from the type of mineral typically found in a conventional potash deposit, such as the mineral found in Canada’s Saskatchewan province, which is a potassium salt.

In Verde’s case, the mineral is a potassium silicate, which can be used to produce ThermoPotash and potassium chloride.

Veloso explains that the production process for manufacturing ThermoPotash is simple – the potassium silicate and limestone are heated in a rotary kiln, cooled and packaged for distribution.

When producing potassium chloride, the output from the rotary kiln is dissolved, purified, evaporated and recrystallised. Since ThermoPotash does not require this additional step in the process, Phase 1 of the Cerrado plant is straightforward and will require less initial capex.

Industry Challenges
Veloso highlights the validation of ThermoPotash as a legitimate product as one of the primary challenges that the company faced in developing the project.

As a new product, ThermoPotash has not been tested on a commercial scale and there is no current market for the product.

Further, along with the rest of the industry, Verde Potash has faced several challenges from an overall capital- and potash-market perspective. The breakdown of the Russian potash cartel last year and the subsequent decline in global potash prices rocked the industry, prompting the company to alter its strategy, notes Veloso.

To mitigate the challenges of market development and spur demand for ThermoPotash, Verde has initiated discussions and secured partnerships with several large corporate growers to test it as a fertiliser source for crops such as sugar cane, soybeans, tobacco, corn, potato and eucalyptus.

Meanwhile, Veloso notes that Brazil is the world’s third-largest agricultural exporter and that potash is a critical fertiliser for agriculture. However, the country currently has to import about 90% of its potash from distant markets such as Canada and Belarus.

He adds that, in 2013, Brazil was one of the largest global importers of potash, having imported 8.1-million tons of potassium chloride.

Further, Brazil has registered a ten-year compound yearly growth rate of 4.7% in potash consumption, which was much stronger than the 2.3% compound yearly growth rate for global potash consumption.

Veloso says that, given the importance of potash for Brazil’s economy, the country’s government has expressed its intention to become potash independent by 2020.

He adds that ThermoPotash will be part of Verde Potash’s contribution to meet that goal and that the company ultimately intends to produce potassium chloride on a large scale during Phase 2 of the Cerrado Verde project.

 

Edited by Samantha Herbst
Creamer Media Deputy Editor

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