Allana Potash doubles its Ethiopia land holdings
Tigrai Online, Sept. 19, 2012
Canadan Allana Potash Finds Shallow Potash in a Previously Unexplored Area of Ethiopia
Lest there be any doubt of its confidence in Ethiopia and its Dallol Potash Project, Allana Potash (T.AAA) has dispelled it by doubling the size of its property. On September 4, the company announced a buyout of Nova-Ethio Potash Corp, increasing thereby the size of its holdings in the Danakhil Depression from 154 square kilometres to 312 square kilometres. Richard Kelertas, Senior VP Corporate Development says the potential addition in potash and water resources is a “bargain.”
The agreement stipulates that Allana will pay Nova 12.7 million common shares and a further 35.6 million should Nova contain 29.2 million tonnes of potassium chloride within the sylvinite zone. (At press time, these 48.3 million shares are worth $28.7 million.) Should Nova contain more than 45 million tonnes of potassium chloride within the sylvinite zone, Allana will pay $7.5 million more, with a cap of 25% of Allana common shares.
How much potash does Nova contain? Kelertas responds, “We have a general idea because Nova has already drilled 21 holes, and we’re reviewing the data now. Our geologist has already come to the conclusion that there is quite a bit of potash in the form of sylvinite in the area. It’s contiguous to our own site, so the geology is probably very similar. We’ll go ahead and commence an exploration drill program for another 20 holes, and that will firm up the resource. Our expectation is we’ll probably prove up anywhere from 25 million tonnes to 45 million tonnes of mineable KCl (sylvinite) on that site, but that’s just an estimate for now.”
Background
Back in June 2012, Ethiopia signed a $1.5 billion agreement with state-run China Communications Construction Co. to build a railway to carry potash from mines being developed in the nation’s northeast.
The Republic of Djibtouti's government in Ethiopia has started the pre-qualification process to select contractors for the construction of the new port at Tadjoura, Djibouti.
With financing from the Arab Fund for Economic and Social Development and the Saudi Fund for Development, the Djibouti government-owned Port Authority will build and operate marine civil facilities and common services - to be constructed with an initial 30-hectare yeard and a 435 metre quay, the company said.
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