In February 2014, a maiden mineral resource estimate of 1.9 billion tonnes containing 356 million tonnes KCl was prepared by K-UTEC AG Salt Technologies (K-UTEC) of Germany, and a scoping study on the Project was released the following month.
In May 2015, K-UTEC completed an updated mineral resource estimate of 4.2 billion tonnes containing 757 million tonnes KCl. Thereafter, in July 2015, a definitive feasibility study (DFS) was completed to the standard of a NI 43-101 Canadian securities code compliant Feasibility Study under the overall supervision of Senet (Pty) Ltd of South Africa (Senet). K-UTEC provided resource definition as well as the design of the well-field and plant. Umvoto Africa (Pty) Ltd. provided water resource modelling and Environmental Resource Management (ERM) conducted the Environmental and Social Impact Assessment (ESIA).
In February 2016, Circum, together with its independent consultants Senet and K-UTEC reviewed the costs in the DFS. Through their analysis, development capital costs were reduced by US$276 million and operating costs were reduced by approximately US$3 per tonne.
Whilst raising financing to start mine development, Circum has undertaken further studies to optimise the project. The development of the processing plants has been modularised, enabling Circum to build the project in phases. This adds exceptional optionality to the project, as Circum can add on more production modules over time, and after the initial construction period, the remaining phases are largely self-funding. As the modules have been designed to be either SOP or MOP focused, Circum could adapt its production to respond to changes in demand and market forces.
In June 2018 Circum completed a DFS on the first phase of the modularised process and is currently targeting production of 1.5 million tonnes per annum of Sulfate of Potash (“SOP”), a premium fertilizer product, followed by 2.0 million tonnes per annum of Muriate of Potash (“MOP”), the most common form of potash fertilizer. Production is anticipated to start in 2021.
Due to the shallow nature of the deposit, the Danakil Potash Project will be amenable to low-cost, low-risk, in-situ leaching. Also, the extremely hot surface temperatures and high regional evaporation rates will allow the use of solar evaporation all year round. As a result, mine gate cash costs are projected to be among the lowest in the potash industry.