Danakali Ltd initiated bidding process for power generation for the Colluli project
By Danakali Ltd,
Danakali Limited (ASX:DNK) is pleased to advise that it has initiated the bidding process for power generation for the Colluli potash project and completed the initial expressions of interest (EOI) phase.
EOI’s have been received from power providers based in the Middle East, Australia, Africa, the United States and the United Kingdom. The shortlisted parties will formally bid in a competitive tendering process based on the technical specifications for power generation determined in the definitive feasibility study. These specifications will be refined following the front end engineering design (FEED) process.
Evaluation of the bids from the shortlisted parties is expected to be completed by April, after which the preferred service provider will be selected and commercial terms finalised.
The definitive feasibility study for the Colluli project contemplated power generation utilising a build own operate transfer (BOOT) model, which formed the basis of the expressions of interest process, and underpins the formal tendering process.
Managing Director, Paul Donaldson said “The high level of interest for providing power generation to the Colluli project is pleasing and is a clear endorsement of both the project and the jurisdiction. We are looking forward to advancing the project throughout the year, and expect to commence work on further refining the mining schedule and tendering for the mining contract in the near future.”
Danakali Limited, in conjunction with the Eritrean National Mining Company (ENAMCO), is developing the world class Colluli Potash Project located in the Danakil region of Eritrea, East Africa. Colluli is the largest and shallowest known evaporite deposit in the world with a solid form ore reserve estimate of over 1.1bn tonnes1.
Colluli has a completed definitive feasibility study, is one of the most advanced greenfield sulphate of potash (SOP) developments in the world and demonstrates outstanding economics including industry leading capital intensity, bottom quartile operating costs, close proximity to coast and key markets and unrivalled product diversification potential.
Globally recognised, and highly reputable engineering and construction firm, Fluor was appointed as the lead for the FEED process for the project. Fluor is a highly reputable, globally recognised engineering and construction firm with extensive experience in potash and Africa.
Approval of the social and environmental impact assessment (SEIA) for the project was given by the Ministry of Land, Water and Environment in December 2016. The award of the Mining Agreement and Mining License for the project is well progressed.