Date: Monday, 20 December 2021
“Colluli is a 200-year life of mine project, the rock salt resource represents another potential revenue stream from Colluli and reinforces Colluli’s primary business model. We believe that the new generation of sodium ion battery development is an opportunity that complements other potential end uses for our mined Rock Salt given Colluli’s proximity to regional markets," says chair.
Danakali Ltd (ASX:DNK, LSE:DNK, OTC:SBMSF) is preparing to capitalise on recent gains in the rock salt spot price, moving to leverage the rock salt resource at its Colluli Sulphate of Potash (SOP) Project in Eritrea, which boasts the world’s highest JORC resource of potash with a solid salt SOP reserve of 1.1 billion tonnes and a rock salt resource of 347 million tonnes at 96.9% sodium chloride.
DNK considers Colluli’s rock salt a potentially economic resource due to positive shifts in the rock salt market caused by a new generation of sodium-ion batteries developed by CATL.
These new sodium ion-e cells are capable of charging faster and operating at lower temperatures than lithium-ion batteries, with the added bonus of 30% lower raw material production costs.
Rock salt prices have risen rapidly year-on-year, averaging about 47% growth by that metric with the current average price sitting at US$50-$60/tonne. Rock salt is seen as a potential source of sodium needed for the mass production of sodium-ion batteries.
Other primary applications for rock salt include its use for de-icing, water treatment and in the chemical, aluminium, oil, paper, textile and food industries.
Danakali chair Seamus Cornelius said: “Colluli is a 200-year life of mine project, the rock salt resource represents another potential revenue stream from Colluli and reinforces Colluli’s primary business model.
“We believe that the new generation of sodium-ion battery development is an opportunity that complements other potential end uses for our mined rock salt given Colluli’s proximity to regional markets.”
While the primary focus of the Colluli Project is potash, the project’s mine plan already requires Danakali to mine through the upper rock salt layer atop the project’s SOP mineral resource to access the target salt layers of carnallitite, sylvinitite and kainitite that start at 16 metres below surface.
Colluli has the potential to produce a 96.9% pure rock salt which was previously described as waste from the open-cut mining process.
Potash mining at the project during modules 1 and 2 will produce an estimated 128 million tonnes of rock salt at an annual production rate of 1.8 million tonnes per annum, which will be stockpiled in preparation for export from the proposed Anfile Bay export terminal during the first 60 years.
Danakali Ltd (ASX:DNK, LSE:DNK, OTC:SBMSF) is focused on the development of the Colluli Sulphate of Potash Project in Eritrea, East Africa.
The company is evaluating renewable options of solar, wind and geothermal energy for becoming a zero-carbon company in the production of SOP at its Colluli Project.