16 August 2013 22:58 [Source: ICIS news]
HOUSTON (ICIS)--Elemental Minerals has been awarded its mining license for its Sintoukola potash project in the Republic of Congo, the Australia-based fertilizer producer announced on Friday.
With the license, the company is now awaiting the pending approval of its Environmental and Social Impact Assessment by regulators, so that it can proceed with construction activities and begin production of the crop nutrient by 2016.
Company officials did not reveal when the final decision on the assessment would be made by authorities in Congo.
While the North American and European potash markets have recently experienced turbulence caused by the disbandment of the Russian cartel, other smaller companies like Elemental are still moving forward and are seeking opportunities outside of the traditional markets, such as the US agricultural industry and rural farmers in India.
Elemental officials said the Sintoukola project has the potential to be among the world’s lowest cost producer of potash and has a great advantage due to its strategic location near the coast of central Africa, which will help facilitate transport of the nutrients to key markets in Brazil and Asia. Sintoukola is located in the Kouilou Province, which is in the southwestern corner of Congo.
Company officials have estimated that the project could cost up to $1.85bn (€1.39bn) and that total construction activities, including supporting infrastructure, might take as long as three years to complete. It has said it hopes to ship the first loads of potash by Q3 2016.
Eventually the operations will include mining and processing facilities, roads and rail lines as well as water and natural gas supply infrastructure. It is planned that eventually a barge and jetty system will be established in order to haul finished products to awaiting oversea shipping vessels.
The conventional underground mine has a life cycle of approximately 23 years. Once fully operational it is expected to have a capacity of 2m tonnes of muriate of potash per year. At last calculations Elemental believes it can produce at a cost of $79.71/tonne FOB (free on board), with a majority of that operating cost being generated by the activities of mining and processing.
Elemental officials said the company’s primary object is to become a scalable, near-term, low-cost independent potash producer that can supply the demand for the crop nutrient.
“This timely approval continues to demonstrate the support for the high quality Sintoukola Potash project. The mining license is another positive step in the development of the project and puts Elemental in a strong position to begin construction once our engineering and feasibility work is complete. It also emphasises the seriousness with which the Republic of Congo government is committed to the development of mining assets in the region,” said Iain Macpherson, Elemental's CEO.
($1 = €0.75)
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