LONDON (ICIS)--Australian Potash Limited (APC) on Wednesday inked a supply deal with German trader Helm for 30,000 tonnes/year of potash from its Lake Wells project in a 10-year take-or-pay term agreement.
Helm will distribute the potassium sulphate (SOP) across Europe, with the deal meaning APC has agreed offtake arrangements for a combined 130,000 tonnes/year (85% of capacity) from a project due to launch in 2023.
Migao will take 50,000 tonnes/year to China, Mitsui 30,000 tonnes/year to countries in Asia-Pacific (excluding China) and Redox 20,000 tonnes/year for customers in Australia and New Zealand.
APC managing director and CEO, Matt Shackleton, described the agreement with Helm as a "defining moment for Australian Potash and the K-BriteTM brand".
"Our Lake Wells product will be distributed into the lucrative and expanding European fertilizer market through Helm's dominant brand and market leading position," he said.
“Helm’s clear strategic direction is to expand their value in brand across the world’s major fertilizer markets, and the marketing and distributorship of SOP forms an integral piece in their offering.
"It is enormously gratifying that APC’s K-BriteTM brand will be central to that program on the European continent.
“This quarter will be a very active period for the company and we look forward to providing updates presently on the development of the Lake Wells SOP project.”
No financial details of the offtake arrangement with the Hamburg-based fertilizer and chemicals trader were disclosed.
APC holds a 100% interest in the mining project around 500km northeast of Kalgoorlie in Western Australia's Eastern Goldfields.
The company plans to extract 150,000 tonnes/year of the crop nutrient from the mine for at least 30 years.